Best Online Only Banks of 2018

Eli McCormick ·
Updated
We maintain strict editorial integrity when we evaluate products and services; however, Top Ten Reviews may earn money when you click on links.

We’ve been reviewing online only banks for six years. For this update we spent about 20 hours researching rates and requirements. Online only banks pay higher interest rates than brick and mortar banks. The average savings account of these banks has an interest rate of 0.67% while other bank’s standard savings accounts average 0.06%. They also offer from $5 to unlimited ATM fee reimbursement. Our top choice for online only banks is Ally Bank, which has the highest savings account and long-term CD rates as well as a large ATM network and provides access to many other financial services.  

Best Overall

Ally Bank

Ally Bank has some of the best rates and benefits of any online bank we reviewed. Its savings account and long-term CDs have the highest interest rates. You’ll also get unlimited reimbursements on out-of-network ATM fees.
View on Ally
Best Value

Discover Bank

Discovery Bank has the best rewards program, offering cash back on debit purchases and other transactions. Its savings, money market and long-term CDs all have excellent interest rates.
View on Discover Bank
Best Checking Accounts

Bank of Internet USA

Bank of Internet USA has some of the best checking accounts we saw. Its rewards account has a low opening balance and no minimum balance requirements. Rewards checking also has high interest rates. Though there’s no ATM network, you get unlimited reimbursement on ATM fees.
View on Bank of Internet

Product
Price
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Overall Rating
9.3
8.1
8
7.9
7.7
7.4
6.8
6.7
6.7
6.3
Interest Rates
9.5
7.3
8.3
8.3
10
7
9
5
4.3
6.8
Services
8.8
9.5
7.3
6.5
4.3
8.3
3.8
8.5
10
6
Security & Support
10
8
8.8
10
8
6.8
6.8
8
6.8
5.3
Home Equity
N/A
N/A
N/A
N/A
N/A
Auto Loans
N/A
N/A
N/A
N/A
N/A
N/A
ATM Reimbursement
$10
$10
N/A
Unlimited
$15
N/A
N/A
Unlimited
$10
$5
Fund Availability (Business Days)
1-2
1-5
1-4
1-2
1-3
1-2
1-3
1-2
1-2
1-2
Mortgages
N/A
N/A
N/A
N/A
Number of ATMs in Network
43,000
450,000
60,000+
N/A
5,300
70,000
43,000
301,500
301,500
2,000,000
Rewards Credit Cards
N/A
N/A
N/A
N/A
IRAs
N/A
N/A
Long-Term CD
2.25%
2.22%
2.00%
1.49%
1.50%
1.89%
0.35%
1.00%
2.20%
1.95%
Basic Checking
0.10%
0.00%
$0.10 on up to 100 transactions per month
0.00%
0.76%
0.10%
0.25%
0.01%
0.00%
0.00%
Savings
1.45%
0.60%
1.01%
0.61%
0.90%
0.30%
1.00%
0.05%
0.10%
1.55%
Short-Term CD
1.00%
0.85%
0.35%
0.55%
0.85%
0.25%
0.15%
0.15%
0.00%
0.25%
Money Market
1.00% (Special terms apply)
0.80%
0.85%
0.75%
N/A
0.50%
1.10%
0.05%
0.30%
0.85%
Premium Checking
0.60%
0.55%
$0.10 on up to 100 transactions per month
1.25%
0.76%
0.50%
0.25%
0.9%
0.25%
0.00%
Live Chat
N/A
N/A
N/A
N/A
N/A
Telephone 24/7
N/A
N/A
N/A
N/A
N/A
N/A
N/A
FDIC or NCUA Insured
Email
N/A
Two-Factor Authentication
Best Overall

Ally Bank

An online only bank has some benefits that brick and mortar banks can’t offer. Ally Bank is one of the best online bank options we reviewed.
It’s interest-bearing checking account offers 0.10% interest for any balance amount. This may seem small, but many checking accounts offer no interest at all. The higher your balance, the more interest you’ll earn. Balances of $15,000 or more earn 0.60% interest. Ally’s savings accounts are even better. The basic savings account has an interest rate of 1% and requires no minimum balance or minimum deposit to open. There are no maintenance fees, though you’ll be limited to six transactions a month, with a $10 fee charged for each additional transaction. Money market and CD rates are also among the highest of the banks we reviewed. The minimum deposit for one of these accounts is $2,500. CD terms range from three months to 10 years, with penalties for early withdrawals. To be eligible for 1 percent rate on a CD you need a minimum deposit of $5,000. To earn the 1 percent on a money market account you need a minimum balance of $25,000. Ally Bank is a member of the Allpoint network, which has over 43,000 surcharge-free ATMs in its network. It also has a tool on its website to help you locate the nearest Allpoint ATM. If there’s isn’t one nearby, don’t worry, you can get $10 worth of ATM fees reimbursed each month.
Pros
  • Savings account has high interest rates and no minimum balance
  • $10 monthly reimbursement on out-of-network ATM fees
  • Best rates for long-term CDs
Cons
  • Balance of $15,000 is required to get the best interest rate in the checking account
  • Only has 43,000 ATMs in its network
  • Doesn’t offer home equity loans
Visit SiteAlly
Best Value

Discover Bank

Discover Bank has one of the best rewards program we saw, which can make it a great value, especially if you use your debit card often. With the Cashback Checking account you’ll get $0.10 back on every purchase and transaction you make, on up to 100 transactions a month.
It has the benefit of not requiring any minimum balance, unlike a lot of high interest checking accounts. There’s no minimum deposit or balance or monthly fee for the Cashback Checking account. The savings account has one of the highest interest rates we saw. It has some advantages over similar savings accounts offered by other online banks. For example, you don’t need to maintain a minimum balance or have a minimum deposit to begin earning interest on your savings. Like most online savings accounts, you are subject to transaction limits. Once you reach your limit, you’ll have to pay a $10 fee for every transaction. Rates for money market accounts and long-term CDs are also excellent. You’ll need a minimum deposit of $2,500 and there are penalties for early withdrawals. Discover Bank gives you access to a network of more than 60,000 surcharge-free ATMs. One drawback is that you won’t be reimbursed for out-of-network ATM fees.
Pros
  • Best rewards program, with no minimum qualifications
  • Over 60,000 ATMs in its network
  • Savings account earns a high interest rate with no minimum requirements
Cons
  • No ATM fee reimbursement
  • Doesn’t offer auto loans
  • CDs and money market accounts have a minimum deposit of $2,500
Visit SiteDiscover Bank
Best Checking Accounts

Bank of Internet USA

The best online checking accounts are available through Bank of Internet USA. It has the highest interest rates for checking accounts we saw, at more than double the average rate of 0.50% most other checking accounts offer.
Another advantage of this bank’s checking accounts is that there’s no minimum amount to be eligible. Many other accounts require large balances, as high as $10,000 in some cases, to earn the maximum amount of interest. Bank of Internet USA’s account earns high interest on any amount in the account. The minimum opening deposit is $100 and there’s no monthly fee. Bank of Internet USA’s savings accounts have slightly below average rates. Like the checking accounts, you only need a $100 deposit and there’s no minimum balance to maintain. The checking account is the main draw as its money market and long-term CD rates are also slightly below average. Short-term CDs do have good rates. This online bank doesn’t have a partnership with any ATM network, but it does offer unlimited reimbursement on any surcharges you pay. This effectively gives you access to any ATM. When you make a withdrawal from an ATM, any fees you pay will be deposited into your account by the end of the next business day.
Pros
  • High interest checking account has no minimum balance requirements
  • Unlimited ATM reimbursements
  • Only a $1,000 minimum for CDs and money market accounts
Cons
  • No rewards credit cards
  • Not a member of any ATM network
  • CD rates are lower than average
Visit SiteBank of Internet

Why Trust Us?
We’ve been writing about online only banks for six years. For this recent update, we looked at banks that lack physical branches and offer checking and savings accounts. More and more banks are developing sophisticated online platforms to manage your finances, so the main benefit of an online only bank is the high interest rates they offer, much higher than the average brick and mortar bank. Online only banks also tend to have fewer fees and lower minimums to start earning interest. The banks we looked at are FDIC insured, have two factor authentications and offer mobile banking apps. We also make sure none of the banks we review have had any recent legal action or data breaches.

How We Tested?
Interest rates are the most important and appealing aspects of online only banks, so we focused on them first. One of the main benefits of a checking account through an online bank is that even the basic account earns some interest. It’s small, ranging from 0.10% to 0.76%, but even at the low end it beats what you can get in a brick and mortar bank. For better interest rates, look at your bank’s rewards credit options. Some accounts provide more interest for higher balances, while others provide the same high interest rate regardless of the account’s balance. Some offer cash back rewards instead of earning interest. So no matter how you plan to use your checking account, there’s an option suited to you.

Savings accounts at online banks don’t have any monthly maintenance fees or require any minimum balances. Opening deposits aren’t more than $100. These savings accounts offer excellent interest rates that beat the best offered by physical banks. Money market accounts and CDs follow this trend as well, offering rates that outpace other banks. CD deposit minimums range from $1,000 to $2,500.

Many of the online banks we looked at are members of one or more ATM networks, so you’ll be able to use ATMs surcharge free. You can use tools provided on the bank’s website or app to find the nearest ATMs. If there isn’t one nearby, most offer some reimbursement of the fees. 

Benefits and Drawbacks of Online Only Banks
When deciding to join an online bank or stick with one that has physical branches, there are some things you’ll need to consider before making a choice.

Benefits
Low rates: Because online only banks don’t have the overhead costs of brick and mortar branches, they can offer higher rates on checking, savings and CD accounts.

Low fees
Many traditional banks charge fees on basic checking and savings accounts, either for inactivity or if you fail to maintain a certain balance. Many brick and mortar banks will offer enticing promotions to start an account, but if you look at the fine print you’ll find they charge multiple fees.

Similar services
An online bank offers a lot of the same services you can find at traditional banks. Many of the banks we reviewed offer home and auto loans, as well as rewards credit cards.

Drawbacks
Limited Customer Service: If you value a more personal touch, a traditional bank may be a better choice. Especially if you’re buying a home or getting a loan, working with a loan office at a local bank can make a complicated process easier. Not many online banks have 24/7 customer service, but they can always be reached by email.

ATM fees
Most banks have their own ATM networks that are broad and help you avoid fees. Several online banks partner with ATM networks, but those tend to have fewer locations than the big banks. Many online banks do reimburse you for some of the fees.

Outages
Websites do go down, either for maintenance or unexpected outages. Having a physical location where you can do your banking is one way to avoid any issues with an unreliable website. All the online banks we review are FDIC insured, so if any economic calamities happen your money will be safe.

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