Online-only financial institutions that provide banking solutions are common today. The first online-only bank, First Internet Bank of Indiana, opened in 1999 and forever changed the way we bank. Whether through a bank, credit union or financial service firm, you can open savings or checking accounts to manage your day-to-day expenses or set up an emergency fund to save for a rainy day all without stepping foot in a brick-and-mortar location.
You might not be as familiar with online bank names, which can feel uncomfortable and unsettling to anyone new to managing their money online, said Rita-Soledad Fernández Paulino, who goes by “Soledad,” a personal finance coach and founder of Wealth Para Todos. But as long as the online bank is insured by the Federal Deposit Insurance Corporation or National Credit Union Administration, your money is protected up to $250,000 per bank, per account type.
You may want to consider online banks because they offer some of the most competitive rates on high-yield savings or certificate of deposit accounts. Some online-only banks offer many helpful features, such as 24/7 live customer service support, that will simplify your banking needs. You can choose an online bank or credit union as your primary bank or open multiple accounts at separate institutions to help you reach your financial goals.
Compare the best online banks
CNET’s list of the best online banks includes some of the most popular financial institutions nationwide.
BankSavings AccountCDsChecking AccountMoney MarketAccepts cash deposits?ATM fee rebatesAlliant Credit UnionYesYesYesNoYesUp to $20/monthAllyYesYesYesYesNoUp to $10/statement cycleBask BankYesYesNoNoNoN/ABread SavingYesYesNoNoNoN/ACIT BankYesYesYesYesYesUp to $30/monthDiscover BankYesYesYesYesNo$0LendingClubYesYesYesNoYesUnlimitedMarcus by Goldman SachsYesYesNoNoNoN/ASoFiYesNoYesNoYes$0SynchronyYesYesNoYesNoUp to $5/statement cycle
Products offered:
Savings: 3.10% APY
Checking: 0.25% APY
1-year certificate (CD): 5.25% APY
Monthly fees: None
Alliant Credit Union offers great savings rates, but you’ll need to be a member to bank with it. Membership is open to current or former employees of Alliant’s US partner businesses. You can also join Foster Care to Success to become eligible for Alliant membership. (It costs $5 to sign up, but Alliant will pay the one-time fee on your behalf.) If you sign up for e-statements, you won’t have to worry about monthly fees, plus you’ll earn competitive APYs on savings and checking accounts. Alliant Credit Union also offers a variety of CD terms from three months to five years.
Alliant currently offers The Ultimate Opportunity Savings Account promotion for new Alliant members who open a savings account by Dec. 31, 2023. Pad your savings with a $100 bonus after depositing $100 every month for 12 consecutive months after opening a savings account. Yes, it will take over a year to reach this bonus, but the process can help you build healthy savings habits along the way.
Read our full Alliant Credit Union review.
Pros and Cons
Pros
Competitive APYs on savings and checking accounts
No monthly maintenance or overdraft fees
Low minimum deposit requirements to open accounts
Up to $20 in ATM rebates per month
Fee-free network of 80,000 ATMs
New savings account bonus
Cons
No support for peer-to-peer payment tools
Products offered:
Savings: 4.25% APY
Spending: 0.10% – 0.25% APY
1-year CD: 4.85% APY
Money Market: 4.40% APY
Monthly fees: None
Ally Bank is an ideal alternative to traditional brick-and-mortar banks. Founded in 2009, Ally is a full-service bank offering consistently competitive rates on all deposit accounts. The highest rates are available for all balances, regardless of tier.
High APYs, minimal fees and 24/7 customer support help to make Ally an attractive banking solution for the 21st century retail banking customer.
Read our full Ally Bank review.
Pros and Cons
Pros
Competitive APYs on deposit accounts
No monthly maintenance or overdraft fee
Fee-free network of 43,000 AllPoint ATMs
No minimum deposit requirements
24/7 customer support
Cons
No cash deposits accepted
Products offered:
Savings: 5% APY
1-year CD: 5.15% APY
Monthly fees: None
Bask Bank offers competitive APYs on savings accounts and CDs. There are no minimum balances required to open or maintain a savings account. With a $25,000 deposit, you can earn American Airlines miles. CD terms range from six months to two years.
Pros and Cons
Pros
High APY on savings and CDs
Low minimum deposit requirements for savings account
Low fees
Variety of CD terms available
Cons
No checking account
High minimum deposit requirement for CDs
Limited number of products available
Products offered:
Savings: 5.00% APY
1-year CD: 5.50% APY
Monthly fees: None
As the online banking arm of Bread Financial, Bread Savings offers competitive rates on savings and CDs and accounts with minimal fees.
Pros and Cons
Pros
High APY on savings and CDs
Low deposit required to open savings account
Low fees
Variety of CD terms available
Cons
No checking account
High minimum deposits to open a CD
Limited number of products available
No cash deposits accepted
Products offered:
Monthly fees: None
BrioDirect is the online arm of Webster Bank. It offers CDs with terms ranging from 30 days to five years. All transactions can be managed via its mobile app.
Pros and Cons
Pros
High promotional APY on select CD terms
Low deposit required to open savings account
CD terms range from 30 days to five years
Cons
No savings or checking account
No cash deposits accepted
Savings: 0.25% – 5.05% APY
Checking: 0.10% – 0.25% APY
1-year CD: 0.30% APY
Money Market: 1.55% APY
Monthly fees: None
CIT Bank is a full-service bank that also offers mortgages and commercial financing options. While the Platinum Savings account offers a competitive APY, the $5,000 minimum balance to earn it might be a steep hill for some people to climb. There’s a low barrier to entry to open deposit accounts, however. CIT’s savings, checking and money market accounts all have a low initial deposit requirement of $100.
A CIT CD — including its no-penalty and bump-up CDs — can be opened with a minimum balance of $1,000. CD terms range from six months to five years. In addition to competitive rates and a variety of accounts, CIT Bank doesn’t charge monthly maintenance or overdraft fees on deposit accounts.
Pros and Cons
Pros
Competitive APYs for its savings account and for several CD terms
No monthly maintenance or overdraft fees
Low minimum deposit requirements to open accounts
Variety of CD types available
Mobile check deposits available through app
Up to $30 per month in ATM rebates
Cons
High minimum deposit requirement to qualify for the highest savings account APY
No ATM access from any savings account
The eChecking account doesn’t provide check-writing privileges
Products offered:
Savings: 4.30% APY
Checking: 0% APY
1-year CD: 4.85% APY
Money Market: 4.20% APY – 4.25% APY
Monthly fees: None
Discover Bank offers deposit accounts, credit cards, personal loans and student loans. It eliminated fees on deposit accounts in June 2019. The Discover Cashback Debit account is a completely free checking account that pays 1% cash back on debit card purchases up to $3,000 per month.
Pros and Cons
Pros
Competitive APYs on savings accounts
No monthly maintenance or overdraft fees
No minimum deposit requirements to open accounts
Fee-free network of 60,000 ATMs
Direct deposits accessible two days early
Cash-back rewards on checking
Cons
High minimum deposit to open a CD
No cash deposits accepted
Products offered:
Savings: 4.50% APY
Checking: Up to 0.15% APY (for balances over $100,000)
1-year CD: 5.50% APY
Monthly fees: None
LendingClub offers a full suite of banking products and services. Unlimited ATM fee rebates give customers unfettered access to a vast network of ATMs. Low fees and competitive APYs make LendingClub’s savings accounts and CDs particularly compelling.
Read our full Lending Club banking review.
Pros and Cons
Pros
High APY on savings and CDs
Low deposits required to open savings account, no minimum balance required
Low fees
Cash-back rewards on debit card-qualified purchases
Unlimited ATM fee rebates
Cons
APY paid on higher checking balances
High deposit required to open CDs
Products offered:
Savings: 4.30% APY
1-year CD: 5.20% APY
Monthly fees: None
Launched in 2016, Marcus is the online-only banking arm of Goldman Sachs, one of the 10 largest banks in the US. The bank’s savings accounts and CDs offer competitive yields and low fees.
See our full review of Marcus by Goldman Sachs for more details.
Pros and Cons
Pros
Competitive APYs on deposit accounts
No monthly maintenance fees
Low minimum deposit requirements
Automated 24/7 customer support
Cons
No cash or mobile check deposits accepted
No checking accounts
No ATM network
Limited types of accounts
Products offered:
Savings: Up to 4.50% APY
Checking: 0.50%
Monthly fees: None
SoFi (short for Social Finance) was the brainchild of Stanford Business School graduates who created an alumni-funded lending source that initially focused on refinancing student loans. Since then, SoFi has expanded into a variety of loan categories and now offers online checking and savings accounts. Some applicants may qualify for a new account bonus.
Read our full SoFi banking review.
Pros and Cons
Pros
Competitive APYs on checking and savings accounts
Low deposits required to open savings and CD account
No monthly maintenance or overdraft fees
Fee-free network of 55,000 Allpoint ATMs
Direct deposits accessible two days early
Cons
Fee charged for depositing cash
Products offered:
Savings: 4.50% APY
1-year CD: 5.10% APY
Money Market: 2.25% APY
Monthly fees: None
Synchrony takes advantage of its limited overhead to offer competitive rates on deposit accounts. In addition to a wide variety of financial products such as IRA CDs and IRA money market accounts, Synchrony offers niche types of CDs, including a bump-up (which automatically adjusts to a higher APY when available) and no-penalty varieties.
Read our full Synchrony Bank review.
Pros and Cons
Pros
Competitive APYs on deposit accounts
No monthly maintenance or overdraft fees
Up to $5 out-of-network rebate per month
No minimum deposit requirements
Cons
Note: APYs shown are as of Oct. 23, 2023. CNET’s editorial team updates this information regularly. APYs may have changed since they were last updated and may vary by region for some products.
What is an online bank?
An online bank, credit union or financial services firm lets you fully manage your money and accounts online via a website, mobile device or app. Most banking services — including transferring funds and depositing checks — can also be handled online.
“More people are leaning toward online banking,” said Bola Sokunbi, founder of Clever Girl Finance. But with technology making everything we do more accessible from a smartphone, that doesn’t mean there aren’t drawbacks to online banks. Online-only banks lack in-person assistance, and some might not offer cash deposits, making it tricky to bank there if you’re often paid in cash.
But if you’re comfortable managing your money online, it can be a convenient, low-cost banking choice. “Just make sure the bank meets your needs and it’s not going to cost you a ton of money to keep your money there,” Sokunbi said.
Online banks typically offer higher interest rates than traditional banks, Sokunbi said. And one major advantage is that some even let you earn interest on your checking account, a feature most big banks don’t offer.
And although online accounts generally have fewer account fees, you can save a lot of money by being aware of any additional fees, Sokunbi said. An online checking account, for example, might charge an ATM withdrawal fee. And an online savings account might charge you an excessive withdrawal fee if you go beyond six transfers or withdrawals per statement cycle, said Shang Saavedra, founder and CEO of Save My Cents.
Transferring money out of an online account can also take time. Make sure you feel comfortable with how you’re able to access your money — including withdrawing or transferring funds and making deposits. If you need assistance, you’ll need to navigate the bank’s customer service line, email support or chat.
How do I deposit and withdraw money from an online bank account?
How you deposit and withdraw money will depend on your bank. And the transfer time may make a big difference in which one you choose.
Bank transfer: A bank transfer is one of the most common and seamless ways to transfer money online from one bank account to another. You can transfer money to or from an existing account using the account and routing numbers through your online account or mobile app. Some banks also let you transfer money through banking platforms like Plaid or Zelle. While some banks may transfer your money instantly or within two business days, some can take as long as seven — which can make a big difference, Sokunbi said.
Mail or wire transfer: Even if the only bank you choose doesn’t have a physical branch you can visit, you may still be able to mail a paper check or wire transfer with the funds to deposit into your account. However, this route will likely take longer for your money to hit your account compared to other options.
Mobile check deposit: If your online bank offers mobile account access, you can deposit a paper check using the mobile app and your smartphone camera. Usually, there’s no fee, and the money is available in one to two business days, depending on the bank.
ATM deposit and withdrawal: Many online banks offer an ATM network for fee-free deposits and withdrawals. And you may be reimbursed for out-of-network ATMs. Some online banks partner with brick-and-mortar financial institutions or offer ATM deposit access if you prefer to make transfers in person. Cash deposits are usually available instantly, but checks may take a few days. Not all online banks allow you to deposit cash at an ATM. And not all online accounts come with ATM access to withdraw your money.
Pros and cons of online banks
Cons
Limited banking services
No in-person physical assistance
May not accept cash deposits
Limited ATM availability without fees
Are online banks safe?
Like traditional banks, money stored at an online bank is safe as long as it is FDIC- or NCUA-insured to protect your deposits up to $250,000 per individual, per bank.
But keeping your financial and personal data secure when banking online is also important. Choose an online bank with robust safety and security features to protect your account. Some essential features to look for include two-factor or biometric authentication, end-to-end encryption and no liability for unauthorized transactions. This can help keep your account more secure and protect it from data breaches and hackers. Before opening an account at an online bank, ask customer service about any safety features and be sure to enable them for your safety.
How to open an account with an online bank
Opening an account with an online bank is usually straightforward. Once you’ve compared different bank options and are ready to open an account, follow these steps:
Go to the bank’s official website.Narrow down which account(s) you want to open and review any requirements and fees.Complete the application with any required personal information and verification.Fund your account using the bank’s approved deposit methods.
From there, you can download the bank’s official mobile app and request a debit card (if available).
How we research banks
CNET reviews online banks based on the latest APY information, fees charged and services offered from issuer websites. We evaluated online banks from among more than 50 banks, credit unions and financial companies. We selected the banks with the highest APY that were insured up to $250,000 by the FDIC or NCUA.
Banks surveyed include: Alliant Credit Union, Ally Bank, America First Credit Union, American Express National Bank, Axos Bank, Bank of America, Bank of the West, Bank5 Connect, Barclays, BMO, Bread Savings, BrioDirect, Capital One, CFG Community Bank, Citizens Access, Colorado Federal Savings Bank, Connexus Credit Union, Consumers Credit Union, Credit One Bank, Discover Bank, First Internet Bank of Indiana, First Tech Federal Credit Union, FNBO Direct, GO2bank, Golden 1 Credit Union, HSBC Bank, Huntington Bank, Lake Michigan Credit Union, LendingClub Bank, Live Oak Bank, M&T Bank, Marcus by Goldman Sachs, Merrick Bank, Nationwide (by Axos), Navy Federal Credit Union, NBKC, OneUnited Bank, Pentagon Federal Credit Union, PNC, Popular Direct, PurePoint Financial, Quontic Bank, Rising Bank, Salem Five Direct, Sallie Mae Bank, Santander Bank, SchoolsFirst Federal Credit Union, Synchrony Bank, TAB Bank, TD Bank, TIAA Bank, Truist Bank, U.S. Bank, UFB Direct, Union Bank, USAA Bank, Vio Bank, and Wells Fargo.
This article includes some material that was previously published on NextAdvisor, a CNET Money sister site that was also owned by Red Ventures and which has merged with CNET Money. It has been edited and updated by CNET Money editors.
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