Online banks may offer you checking account features that aren’t available at your bank down the street.
The best online checking accounts give you some interest, reimburse at least some ATM fees, belong to a large ATM network and give you free checks. They also offer a highly rated mobile app, competitive customer service hours and a website that is easy to navigate.
If these features are offered by brick-and-mortar banks, the financial institutions may require a high minimum balance for you to have access to them. With online checking accounts often not requiring minimum balances, make sure you consider them when looking for a checking account. Here are Bankrate’s picks for the best online checking accounts.
Best Online Checking Overall: Ally Bank
Ally Bank’s Interest Checking Account earns a little bit of interest, doesn’t charge you on some things other banks charge for (such as checks) and has a highly rated app. You’ll get free official bank checks, free standard checks and free incoming wire transfers for this account. This applies to both international and domestic incoming wires. Interest Checking customers have access to more than 40,000 Allpoint ATMs. But for those times when you’re not able to use one of those ATMs, Ally Bank reimburses up to $10 worth of fees charged at out-of-network ATMs per statement cycle. At Ally Bank, you also have the ability to chat with customer service online and access a 24/7 toll-free number.
What to watch: You’ll need at least $15,000 to earn the top-tier APY on this checking account. Savers looking for a higher yield on their money, especially if it’s earmarked for saving, should consider high-yield savings accounts or money market accounts for that money.
Best Online Checking for Beginners: Chime
It’s easy to make a mistake that causes your account to have a negative balance. These mistakes, called overdrafts, can be costly. The average overdraft fee is $33.36, according to Bankrate’s 2019 checking account and ATM fee study. At Chime, some customers can overdraw their account; however, the challenger bank doesn’t charge for the service.
Chime customers also have access to their direct deposit up to two days early. This may help beginning bankers who need some extra stretch to buy gas or groceries before payday hits.
What to watch: Chime isn’t a bank. But its banking services are provided by The Bancorp Bank or Stride Bank, N.A. Both banks are Federal Deposit Insurance Corp. (FDIC) banks.
Best Online Checking for Travel: Charles Schwab
Charles Schwab Bank’s High Yield Investor Checking account gives you unlimited worldwide ATM fee reimbursement. The account doesn’t charge a monthly fee and you don’t have to keep a minimum balance in it. Schwab also doesn’t charge you a foreign transaction fee when making a purchase overseas.
What to watch: As with many banking policies, Schwab Bank can change or discontinue its fee-waiver policy at any time. So, make sure you keep up with your banking disclosures and check the Schwab website once in a while to confirm the policy still exists. Importantly, you also need to open a Schwab One brokerage account when you open the Schwab High Yield Investor Checking account.
Best Online Checking for Teens: Navy Federal Credit Union
Navy Federal Credit Union’s Free Campus Checking account gives members who are full-time students an account they can use through high school and college. Members aged 14-24 don’t have to pay a monthly service fee and they don’t have to keep a certain balance in this account. Up to $10 per month of ATM fees are reimbursed each statement cycle, giving students the ability to access any ATM for free (as long as it doesn’t exceed that amount in fees). The Free Campus Checking account also earns a little bit of interest.
What to watch: You’ll have to qualify for Navy Federal Credit Union membership to get this account. Membership is open to all Department of Defense and Coast Guard Active Duty, civilian, contract personnel, veterans and their families. The account offers interest, but you can still earn a higher yield in a savings account. Even if it’s not called a student savings account, you should be able to find an account that offers a competitive annual percentage yield (APY) and doesn’t have a minimum balance requirement.
Best Online Checking for Cash Back: Radius Bank
Radius Bank’s Rewards checking account helps you earn 1 percent cash back on everyday purchases. You also earn a little bit of interest on money kept in the account. The account also has access to free ATMs around the globe.
What to watch: Earning interest in a checking account is a nice feature. But you can earn a higher annual percentage yield (APY) in a high-yield savings account or a money market account at an online bank.
Best Online Checking for Joint Accounts: Simple
Simple offers a twist on the joint account in its Simple Shared account. This account consists of one shared account and two individual accounts and it is designed for all kinds of partners (including roommates and friends), not just married pairs. Money in a shared goal earns a competitive APY.
What to watch: Simple’s app is only rated 3.4 stars on the Apple App store. Consider a bank’s mobile app rating if you intend to rely on using the mobile app to perform banking transactions.
Best Online Cash Back Checking/Savings Combo: Discover Bank
The Discover Bank Checking Account helps you earn 1 percent cash back on up to $3,000 worth of debit card purchases you make each month. Free standard checks and official bank checks are free features of this account.
On the savings side, a Discover Bank Online Savings Account can earn you a competitive APY. Neither of those accounts have monthly fees.
What to watch: There are savings accounts that allow you to earn a higher APY than the Discover Bank Online Savings Account. Also, some credit cards offer more than 1 percent cash back on certain purchases.
Pros and cons of online checking accounts
Here are the pros of online checking accounts:
- You should be able to access your account anytime.
- Almost all banks will let you mobile deposit checks.
- Some banks give you transaction alerts, including warning you if you’re about to overdraw your account.
- Many online checking accounts let you view your bank statements online. Some accounts let you search your transactions online.
Here are the cons of online checking accounts:
- An online bank without branches won’t be able to help you with in-person banking.
- You won’t be able to sit down with a banker at an online bank.
- You won’t be able to get money from a teller with an online bank.
What to know about online banks
Here is everything you need to know about banking with online banks.
Are online banks trustworthy?
Make sure you’re banking with a Federal Deposit Insurance Corp. (FDIC) bank or a National Credit Union Administration (NCUA) credit union. They are government-backed organizations. An FDIC brick-and-mortar bank and an FDIC-insured online bank both offer customers FDIC insurance.
In some cases, the online bank may be a division of the traditional bank or the funds might be held under the FDIC insurance of the brick-and-mortar bank. Here are some examples:
- Bank5 Connect is a division of BankFive
- BrioDirect is an online brand of Sterling National Bank
- Citizens Access is a division of Citizens Bank
- Investors eAccess is a trade name of Investors Bank
Do online banks offer debit cards?
Online banks usually offer debit cards for their checking accounts. Online banks might not offer debit cards or ATM cards for savings accounts or money market accounts.
You can usually use debit cards to make purchases and withdraw money at an ATM. With a money market account or possibly a savings account, a debit card may only be able to withdraw money from an ATM.
What are some things I should consider when choosing the best online bank?
Like any purchase or decision, you want to research and compare the best options. Some items to consider are:
- How you’ll be able to access your money: Does it come with a debit or ATM card to withdraw money from an ATM?
- Does it come with free checks or is there a fee for checks?
- Does it have branches? Or is it an online-only bank?
- Does the debit card earn rewards or cash back?
- Is the app or website easy to use and reliable?
- How can you transfer money to other accounts or people?
Look out for any fees, too. Monthly service fees can add up. Bankrate’s 2019 checking account and ATM fee study found the monthly service fees for interest-bearing accounts was $15.05 and the monthly fee on non-interest checking accounts was $5.61. Even one fee can be costly. That’s why finding an online bank that doesn’t have a minimum balance requirement or maintenance fee can be a good choice to save money. Brick-and-mortar banks may have direct deposit requirements on some accounts to avoid a monthly maintenance fee.
How do I get cash with an online bank?
Many online banks will have a debit card or ATM card for their checking account. These cards will let you access money from an ATM.
You’ll want to check with your bank to find what ATM network it belongs to, if applicable.
Summary of our top online checking accounts
- Ally Bank: Best online checking overall
- Chime: Best online checking for beginners
- Charles Schwab: Best online checking for travel
- Navy Federal Credit Union: Best online checking for teens
- Radius Bank: Best online checking for cash back
- Simple: Best online checking for joint accounts
- Discover Bank: Best checking/savings combo