Top Online Banks in US
This is a writing sample from Scripted writer Ruby Sasha Alosbanos
Gone are the days when you have to personally visit a local bank if you’re going to open an account. Financial institutions are keeping up with the times, and online banks are making waves with offers of lower fees and higher interest rates than mainstream banks. Plus, instead of a personal appearance, you only have to download a mobile app to enjoy the bank’s full services.
Below, we’ve listed 10 of the best online banks in the US. But we also know that the best bank suits all your needs perfectly, so we’ll specify their pros and cons and who will benefit most from its services. All banks in this list are FDIC-insured.
Ally Bank
Ally Bank is one of the forerunners of online banks in the US. It used to be the financial arm of General Motors before it evolved into one of the largest banks in the country by assets. This online bank offers a full range of banking products and services like savings, checking, money market accounts, and certificates of deposits.
Why Do People Like Ally Bank?
- There is no minimum balance and no monthly fees.
- No overdraft fee.
- The attractive annual percentage yield (APY) rate sits at 0.50% on its savings account and 0.10% to 0.25% on its interest checking account as of 11/15/2021.
- The 24/7 phone support makes for an easy banking experience.
- There is no early withdrawal penalty on CDs so you can cash out after six days of funding your account.
- A wide range of online tools exist, including brokerage accounts with a DIY option for investors.
What are its Drawbacks?
- You can’t make cash deposits.
Is Ally Bank the Right Online Bank for You?
- This bank is for you if you like to see your money grow through savings or investing. With the bank’s attractive APY rates and cutting-edge investing or trading tools, it’s easy to diversify your money into various investment vehicles like CDs, stocks, ETFs, bonds, and mutual funds.
Axos Bank
Formerly known as Bank of Internet USA, this full-service online bank changed its name to Axos Bank in 2018. Aside from the usual range of banking products and services for individual depositors, it also offers banking solutions to business entities.
Why Do People Like Axos Bank?
- There is no minimum balance and no monthly fees.
- The bank offers a very attractive APY rate for high-yield savings accounts at 0.61% as of 11/15/2021.
- Small business and commercial banking solutions include merchant services, business checking accounts, commercial lending, and lines of credit.
- A wide range of checking accounts with rewards cater to different demographics. For instance, its cashback checking provides up to 1.0% cashback on debit card purchases, and rewards checking gives up to 1.0% APY rate as of 11/15/2021.
- The bank offers unlimited domestic ATM fee reimbursement for many types of accounts.
- No minimum deposit for CDs.
What are its Drawbacks?
- Its CD APY rates are not something to be excited about at 0.20% APY as of 11/15/2021.
- You need a $250 initial deposit to open a high-yield savings account.
- Cashback checking accounts have an overdraft fee.
Is Axos Bank the Right Online Bank for You?
- Axos is an excellent choice for business owners looking for financial products and solutions for their enterprise.
- People who use ATMs regularly will also benefit from Axos’ ATM fee reimbursement offering.
- Frequent debit card users and those with high account balances will love Axos checking account’s cashback and high APY, respectively.
Discover Bank
The company that introduced Discover It credit cards has a subsidiary offering online banking services. A subsidiary of Discover Financial Services, Discover Bank offers a wide range of financial products, including checking, money market, retirement, savings accounts, and a certificate of deposits.
Why Do People Like Discover?
- There are no minimum balance and monthly fees.
- No insufficient balance and overdraft fees.
- Discover offers 1% cash back on debit card purchases of up to $3,000.
- Competitive rates on savings accounts and CDs at 0.40% APY and 0.50% APY, respectively, as of 11/15/2021.
- Allows you to grow your nest egg for retirement with an IRA certificate of deposits, which offers up to 0.85% APY.
- The bank offers personal, student, and home loans.
- 24/7 customer service.
- Robust mobile banking app with an iOS rating of 4.9/5 and Android rating of 4.6/5 as of 11/15/2021.
What are its Drawbacks?
- Early withdrawal penalty for certificates of deposits.
- A minimum initial deposit of $2,500 on CDs
Is Discover the Right Online Bank For You?
- If you don’t mind earning cashback instead of interest on your checking account, this bank is for you.
- It’s also suitable for people who want to take out a student loan since most online banks in the US don’t offer this.
- This is also for people wishing to have direct access to Discover credit cards with generous cashback and rewards.
Capital One
Best known for its popular credit cards, Capital One also has an online banking division that offers a suite of products and services. From money markets, custodial accounts, and IRAs on deposit accounts to business banking services, this online bank has a product regardless of age group.
Why Do People Like Capital One?
- There is no monthly fee or minimum balance.
- Access to extensive ATM network (over 70,000).
- Brick-and-mortar branches in select locations.
- Competitive rates on savings account at 0.40% APY
- No minimum balance to open a CD account.
- Interest payment plans on CDs are flexible.
- The bank offers various business instruments for sole proprietorships, partnerships, LLCs, corporations, and small organizations.
- Capital One banking app lets you view your credit card rewards and Creditwise credit scores.
What are its Drawbacks?
- There is an overdraft fee of $35 if you fail to pay the overdrawn amount the next day.
- Stiff early penalty withdrawal on CDs, which is equivalent to up to 6 months of interest.
Is Capital One the Right Online Bank For You?
- With its many branches and digital banking offers, Capital One is perfect for people who want the middle ground between online and traditional banks. You’ll always have options between a convenient mobile banking experience or superb customer service at a physical branch.
- Parents who want to get their kids started with personal finance and teach them the value of saving and budgeting will love Capital One’s no-fee joint account for parents with their kids or teens.
- This is also for business owners who want to take advantage of Capital One’s slew of business banking services and credit cards.
Send Money Abroad Using Online Banks in the US
Online banks have made banking easy and convenient. Need to deposit a check? Just snap a picture of it, upload it, and it’s done. Want to make a direct deposit? A few seconds on your smartphone, and you’re good to go.
You can even fund an international transfer using your online bank account. Download an online money transfer app from Google Play Store or Apple App Store. Key in your details to create an account.
To add your online bank account as a payment method, key in the bank’s routing and account numbers. And voila! You can send money to over 100 countries using your online bank account.
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