Not all bank accounts are created equal. While most online-only banks offer the same services and features as a traditional bank — often more — every online bank is different. Look for features of online banking that will save you time and money and give you peace of mind that your money is safe and secure.
1. Safety online banking features
You may be wondering, are online banks safe? The short answer is yes. Online financial institutions come with many safety features to protect you and your money. When considering an online-only bank, look for the security measures it has in place.
Many online banks use tools like multi-factor authentication, encryption, and firewalls. They may also require using secure browsers to protect your data from hackers. Along with looking for features like these, make sure the bank is FDIC-insured, which covers each of your accounts up to $250,000.
2. Mobile banking app
Many online bank accounts come with intuitive mobile banking apps that allow you to easily access your account on your phone. These apps should be able to handle everything from tracking your spending and savings to paying friends on the go.
Look for an app that works on all smartphone devices and allows you to transfer money, check your account balances, deposit a check, and even grow your savings automatically.
See if the app accepts mobile check deposits, offers fee-free mobile payments and money transfers, and includes online bill pay. You should also be able to set up app notifications, like transaction alerts, and get customer support if you run into any issues.
Some other handy features of online banking apps include spending and savings trackers and other budgeting tools.
3. Early direct deposit
It’s usually a wise decision to sign up for direct deposit. Direct deposit minimizes paperwork and hassle and allows you to get your paycheck faster. Many online banks offer direct deposit, but only a handful allow their customers to receive their paychecks early.
Look for an account that has early direct deposit. For example, when you open an account through Chime, we help you Get Paid Early.
4. ATM withdrawals
Despite the move to handle your finances online, you might still need to access cash. Luckily, switching to an online-only bank doesn’t mean you lose out on ATM and debit card services. Several online banks and financial institutions maintain relationships with ATM networks and offer a method of quickly locating ATMs via their banking app.
Many online banks don’t charge in-network ATM fees, or they offer fee reimbursements.
Keep in mind, though, that not all online banks offer a way to deposit cash back into your account.
5. Built-in automatic savings
When switching to an online banking service, look for one with an automatic savings feature. This feature allows you to automatically set up fund transfers from your checking account to your savings account. You can also transfer a portion of your paycheck directly into your savings account.
For example, Chime offers two features to help you save money automatically. Chime’s automatic Round Ups transfer spare change to your savings account every time you use your Chime Visa debit card.1 You can also sign up for Save When You Get Paid to automatically transfer 10% of your direct deposits of $500 or more into your savings account.2
6. Credit-building features
Building credit can take time, but if you look for an online account with built-in credit-building features, you can speed up the process. Look for features that turn your everyday purchases into credit-building opportunities.
A few online banks and financial institutions offer credit-building support. For example, Chime offers the secured Credit Builder Visa® Credit Card that helps you build your credit. Members see an average increase of 30 points.3,4
When you’re on the hunt for credit-building features, look out for things like cash-advance features, automatic balance payments, and credit bureau reporting.
7. Fee-free overdraft
Brick-and-mortar banks have considerable operational expenses that online banks don’t. With an online bank or online financial institution, fees can be kept to a minimum because of the lower overhead costs associated with an online business. You can potentially save on fees that most traditional banks would charge their customers, like overdraft fees.
Consider switching to an online account with fee-free overdraft protection. Some online accounts, like those through Chime, offer their own version of overdraft protection that safeguards members from any payments or withdrawals that would result in a negative balance. Chime’s SpotMe feature allows users overdraft up to $200 on debit card purchases with no fees.5
