If you’re one of the roughly one-third of Americans who do all their banking online or by phone, it’s time you switched to a financial institution that thinks like you do.
Online banks — those without any physical branches — make up for their lack of in-person convenience by offering higher interest rates on both checking and savings accounts, while often charging you far fewer fees.
All those savings add up, making digital customers feel far more satisfied at direct online banks than at traditional banks, according to research conducted by J.D. Power.
To help you find the best online bank, MONEY reviewed account terms provided by data partner MagnifyMoney.com at more than 50 online banks, focusing on those that offered free ATM access and no monthly service fee, and since it is all about that onscreen experience now, those that also had stellar customer satisfaction scores for their online and mobile banking features.
Best Online Bank: Ally
Why it wins: At Ally — also our 2018 winner — you can earn high interest rates without paying fees or jumping through lots of hoops. Its checking account option doesn’t charge a monthly service fee or fees for incoming wire transfers, cashier’s checks, copies of online statements or ACH transfers. But it does offer 0.10% interest on balances under $15,000. Sock away more and the interest rate automatically jumps to 0.6%.
If you don’t need checks, you can move that money to Ally’s savings account option, which also has no service fees and pays 1.8% interest on any balance size. Its fee-free policy extends to outside ATM usage as well. Ally doesn’t charge you for using an out-of-network ATM, instead it reimburses you up to $10 a month for any fees other ATM owners might charge.
Ally also participates in the Allpoint ATM network, which means you can access 55,000 surcharge-free ATMs in the U.S., Canada, U.K., Puerto Rico, Australia, and Mexico, making it easy to avoid other bank’s ATM surcharges anyway. Ally further outshines its online rivals when it comes to customer happiness, earning higher mobile app ratings than many of its competitors and offering around-the-clock customer service.
Caveat: Other online banks pay slightly higher interest on their checking or savings accounts products and Ally has been steadily lowering the rate for its savings account. In June of this year, it paid 2.2% on all balances.
Key account: Interest Checking Account
Monthly service fee: $0
Interest rate: 0.10% for balances under $15,000. 0.6% for balances over $15,000.
Outside ATM fee: $0, with $10 per month to refund charges by ATM owners.
MONEY partnered with MagnifyMoney.com to produce this year’s Best Banks rankings. MagnifyMoney.com provided account terms 50 popular online banking financial institutions. Our team reviewed account minimums and qualifications, interest rates, monthly service fees, ATM fees, overdraft fees, overdraft protection fees, insufficient funds fees, debit card replacement fees, domestic wire transfer fees, and online banking capabilities.
When selecting finalists, priority was given to checking and savings accounts with no or easily waived monthly fees, free ATMs, and higher interest rates. In naming free accounts, we assumed customers would be okay with receiving e-statements to avoid a monthly fee. MONEY’s edit team independently fact-checked information in September and October.