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The Best Neobanks of 2023
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Neobanks are steadily growing in popularity among tech-savvy consumers as a banking option. Also known as challenger banks, neobanks are tech firms that offer online-only financial services and transactions through online and mobile banking.
Those who choose to bank with a neobank will receive many of the same financial products and services as traditional banking institutions along with the added benefit of lower fees and higher interest rates due to the lower overhead costs of online banks.
To determine the best available neobanks, GOBankingRates ranked 15 online bank accounts based on a number of factors, including:
- Monthly fee
- Minimum balance
- Checking fee ratio
- Minimum balance needed in account to earn APY
- Savings APY
- Mobile app ratings
GOBankingRates’ Best Neobanks of 2023
Best for online banking
Why we like SoFi
With a full range of services, high interest rates on a combined checking and savings account and a partner network of more than 55,000 fee-free ATMs, SoFi is a solid choice for those looking to do all their banking at one online bank. The bank also entices potential customers with bonuses and rewards.
SoFi hands out a cash bonus of up to $250 to those who open a new checking and savings account, as long as customers sign up for direct deposit.
Pros
- High interest rates on checking and savings
- Rewards for using the app
- No fees or minimums
- All your banking and investing in one place
Cons
- No physical branches
For customers looking for a one-stop shop for all their financial business, and who don’t need to talk to a teller, SoFi is an ideal choice. The annual percentage yields are quite high, you have access to an extensive network of fee-free ATMs and you can earn rewards and discounts by keeping all your accounts in one place.
Best for investing
Why we like Acorns
Acorns offers basic, low-cost deposit accounts that encourage saving and investing. It’s likely to appeal to anyone who is banking for the first time and prefers to manage their accounts online. The account prioritizes micro-investing, which makes Acorns a good choice for first-time investors as well.
Acorns has a non-interest-bearing Emergency Fund that’s separate from your Acorns Checking and Invest accounts.
Pros
- No monthly maintenance fees
- Automated saving
- Solid range of perks
Cons
- Non-interest-bearing accounts
- Subscription fees
Because Acorns is not itself a bank, it provides banking services through Lincoln Savings Bank and NBKC Bank, both of which are FDIC members. Those banking services work with Acorns’ subscription-based investing products to provide a solid solution for managing and investing your money.
Best for no fees
Why we like Betterment
As a pioneer in the robo-advisory world, Betterment has done a great job honing and refining its core products. Its checking and savings account options may be limited, but they are completely fee-free.
The savings account APY is 11x higher than the national average, which makes it an attractive option for maximizing savings.
Pros
- Savings APY above national average
- Lack of fees
- Cash-back rewards options
Cons
- Limited account options
One particularly strong account is Betterment’s Cash Reserve. It is a high-yield savings account that can be opened with as little as $10. This account comes with an APY of and no minimum balance requirements or monthly service fees. Customers can make unlimited withdrawals from the account penalty-free. Individual Cash Reserve accounts are insured up to $1 million or up to $2 million for joint accounts.
Best for digital banking
Why we like Chime
The Chime®* app is working on removing all the objections that hold people back from going fully digital. You can make cash deposits at participating retailers, pay friends and bills without the need for checks and open an account even if you have less than stellar credit.
The Chime Checking Account has no monthly fees, minimum balance requirements or opening deposit requirements to meet.
Pros
- No service fees
- Round up debit card1 transactions to the nearest dollar and the spare change goes to your savings account
- 24/7 customer service via phone or chat
Cons
- Out-of-network ATM fee of $2.502
- Limited account options
Chime’s savings account features an APY of 3 and no monthly fees. You can set up automated savings to grow your balance. The savings account is optional, and a Chime checking account is required to open it.
Best for budgeting tools
Why we like Current
A fintech company with a robust mobile app and a wealth of budgeting tools to help customers stay on top of their savings, Current will certainly appeal to the tech-savvy saver. You can earn outstanding yields on your money, and Current also lets you buy and sell cryptocurrency with no trading fees.
Savings Pods allow you to earn up to APY, while also helping you organize your savings goals.
Pros
- No minimum opening balance or account balance requirement
- Free budgeting tools available in the app
- Can get points redeemable for cash back by using debit card at select merchants
- Savings Pod balances earn high APY
Cons
- Low spending limit on debit card
- No physical locations
For customers who embrace technological advances as well as generous interest rates, Current is an intriguing option. Those willing to take full advantage of Current’s budgeting tools will likely be on their way to more structured savings. Current checking comes with a debit card that earns cash-back rewards, but be aware that there are daily spending limits on withdrawals and purchases.
Best for high APY
Why we like GO2bank
The GO2bank savings account offers APY on balances up to $5,000. With direct deposit, you can avoid monthly maintenance fees, and if you do all your banking electronically, you can avoid fees for cash deposits and withdrawals, among other transactions.
Earn up to 7% cash back when you buy eGift Cards from over 100 merchants in GO2bank’s app.
Pros
- APY on balances up to $5,000
- Easy-to-waive monthly maintenance fees
- Free ATMs nationwide
Cons
- Fees for cash deposits, teller cash withdrawals and transfers from a linked debit card
GO2bank’s APY is 10x the national savings rate. Plus, there’s overdraft protection available for up to $200 if you sign up for direct deposit.
Best for rewards
Why we like LendingClub Bank
LendingClub is an online bank that excels at rewarding its customers. From cash-back debit cards to high-yield savings accounts and CDs, LendingClub is a solid choice for customers who want to put their savings to work.
High-Yield Savings allows you to earn on your entire balance. There are no monthly service fees and just a $100 minimum deposit needed to open an account.
Pros
- Rewards account pays interest
- Free checking and savings accounts
- High rates for savings accounts and CDs
Cons
- Only one physical branch
- Mobile app is not highly rated
LendingClub is ideal for those looking to earn high rates on their savings or rewards on their purchases. You’ll need to get used to working with an app and debit card for withdrawals and payments, but the benefits are worthwhile.
Best for foreign exchange
Why we like Revolut
Revolut is not a bank per se, although it offers banking services, such as savings and checking-type accounts, and credit cards through Metropolitan Commercial Bank and Sutton Bank. It offers investments, including ETFs, stocks and cryptocurrency, as well as foreign exchange and money transfer services.
With Revolut you can hold or send money in over 25 different currencies, including U.S. dollars, British pounds, Canadian dollars, Mexican pesos, euros and more.
Pros
- No-commission stock trades
- Worldwide money transfer services
- Fee-free crypto trades
Cons
- No traditional checking account
- Savings interest is low for an online-only banking option
Revolut offers three different plans: Standard, Premium and Metal. The Standard plan is free and pays APY on savings balances and free crypto trading up to $200,000 per month. The Premium and Metal Plans have monthly fees of $9.99 and $16.99, respectively, but pay APY on savings.
Best for savings APY
Why we like Upgrade
Upgrade is an online-only financial technology company, with checking and savings accounts, credit cards and personal loans. It has no fees for its deposit products and offers higher-than-average interest rates on savings. Its Rewards Checking account pays up to 2% cash back on debit card purchases.
The Upgrade Premier Savings account pays APY interest on balances of $1,000 or more, and there are no monthly fees.
Pros
- Earn cash back on debit card purchases
- Earn APY interest on $1,000 or more in savings
- No monthly fees
- Free same-day transfers offered
Cons
- No physical branches or ATMs
Upgrade offers a Rewards Checking account that gives you cash back on debit card purchases, which is unusual. But what’s even rarer is the amount of cash back you get. You’ll get 2% cash back on purchases you make at convenience and drug stores, gas stations and restaurants.
Best for no fees
Why we like Varo Bank
Varo Bank is a simple-to-use digital bank option that provides some great benefits. It offers FDIC-insured checking and savings accounts with no hidden fees.
Varo offers three basic account types: checking, savings and a credit-builder secured credit card account.
Pros
- No monthly fees or minimum balance requirements
- Highly competitive rates on savings
- Plenty of fee-free ATMs
- Favorable terms with Believe credit-builder card
Cons
- Limits on cash deposits and external transfers
- No physical branches, so you must deposit cash through third parties
Varo Bank provides checking, savings and credit-building opportunities for its members. It charges few fees and offers highly competitive savings interest rates and over 55,000 fee-free ATMs.
What To Know About Neobanks
A neobank is a tech firm that offers online-only financial services through mobile and online banking. Nearly all financial transactions can be performed online with a neobank, including transferring money, paying bills and depositing mobile checks. A neobank does not have a brick-and-mortar presence or physical branches.
What Is a Neobank?
The difference between a traditional bank and a neobank is a neobank does not have a brick-and-mortar presence or any physical branches. Essentially, it is a tech company or fintech firm that provides banking services via a website or mobile app. Neobanks are often also referred to as challenger banks.
How Do Neobanks Work?
Essentially, neobanks are online replicas of traditional banks and credit unions. Convenience is one of the greatest benefits of a neobank, as customers may set up their accounts within minutes and begin financial transactions. Some of the most popular services available from neobanks include mobile money transfers, online check deposit and checking and savings account services.
Are Neobanks Safe?
As most neobanks are FDIC-insured, they are considered to be as safe as traditional banks. This means that all accounts are covered and protected typically up to $250,000. If they are not insured through their own charter they will generally do so by working through a larger bank.
Neobanks vs. Traditional Banks
Neobanks, unlike traditional banks, have no physical branches. Though this can limit the services neobanks can offer, because they save on so much overhead and operational costs allowing them to offer more affordable options and fees for their customer base. Neobanks are online only which gives them a flexible virtual presence and an instant account confirmation process.
Pros and Cons of Neobanks
While neobanks are a bit limited in their services, some pros and cons come with using this form of banking.
Pros
There are several advantages of neobanks to be considered such as the following:
- Ease of Access: You can access your funds easily through a neobank’s mobile app or website.
- Ease To Set Up: Setting up an account with a neobank is much less time-consuming than it is with a traditional bank. Some neobanks, depending on the financial institution, do not conduct credit checks. This gives your account a higher chance of approval and may make it easier to set up your account.
- Competitive Rates: Unlike traditional banks, neobanks do not have branch locations. Due to not having to pay for physical premises, their cost of operations is low. This gives neobanks the chance to offer competitive rates and better interest rates to banking customers.
Cons
There are many disadvantages of neobanks to be considered such as the following:
- No physical branches: Not having a branch or in-person banking option can limit some service options.
- Less regulated: Neobanks may not be chartered or licensed which could cause issues if the bank goes bankrupt.
- Complex transactions: As there is no in-person support, complex banking transactions can be problematic with neobanks.
Are Neobanks the Same as Online Banks?
The simple answer to this question is no. While neobanks do offer online banking services, this does not qualify them to be online banks. Online banks have FDIC insurance. Neobanks do not. If you wish to bank with a neobank, it is recommended you make sure the neobank is recognized by the FDIC or is partnered with an FDIC-insured bank.
Is a Neobank Best For You?
A neobank is best for those who are tech-savvy and comfortable in an online banking environment. If you have many complex banking needs or an influx of cash, neobanks may not be the best fit for you.
Recap of the Best Neobanks
- SoFi: Best for Online Banking
- Acorns: Best for Investing
- Betterment: Best for No Fees
- Chime: Best for Digital Banking
- Current: Best for Budgeting Tools
- GO2bank: Best for High APY
- LendingClub Bank: Best for Rewards
- Revolut: Best for Foreign Exchange
- Upgrade: Best for Savings APY
- Varo Bank: Best for No Fees
Best Banks 2023
Best Checking Accounts of 2023
Best Online Bank and Neobank Savings Accounts of 2023
Research Methodology
To determine the Best Neobanks of 2023, GOBankingRates looked at the following factors:
- Monthly fee
- Minimum balance
- Checking fee ratio
- Minimum balance needed in account to earn APY
- Savings APY
- Average mobile app rating between the Android and Apple stores
All factors were scored and combined. Rates and fees are subject to change.
Banks Monitored by GOBankingRates
SoFi, Capital One, NBKC, Bank of America, Chime, Charles Schwab Bank, Axos Bank, Current, First National Bank of Pennsylvania, Citibank, New York Community Bank, First Internet Bank, TIAA, Ally Bank, Truist Bank, Wells Fargo, JPMorgan Chase Bank, Quontic Bank, LendingClub Bank, One Finance, First-Citizens Bank, BMO Harris Bank, FirstBank, Bank 5 Connect, BankUnited, The Huntington National Bank, iGOBanking.com, Arvest Bank, First Interstate Bank, Manufacturers and Traders Trust Company, TD Bank, Zions Bancorporation, USAA Federal Savings Bank, Citizens Bank, Fifth Third Bank, PNC Bank, Pinnacle Bank, Keybank, IncredibleBank, Simmons Bank, Santander Bank, Southstate Bank, Bank of Hawaii, First National Bank of Omaha, Bank of the West, First Hawaiian Bank, Texas Capital Bank, Salem 5 Direct, Umpqua Bank, Synovus Bank, Fulton Bank, Flagstar Bank, Associated Bank, UMB Bank, Valley National Bank, United Community Bank, Washington Federal Bank, Centennial Bank, Prosperity Bank, Ameris Bank, United Bank, Pacific Premier Bank, BOKF, City National Bank of Florida, Midfirst Bank, Frost Bank, TAB Bank, Eastern Bank, FNBO Direct, Cadence Bank, Webster Bank, Old National Bank, Regions Bank, Wilmington Savings Fund Society, MUFG, Union Bank, Bank OZK, First Horizon Bank, CIBC Bank USA, Glacier Bank, Comerica Bank, East West Bank, First Republic Bank, Columbia State Bank, City National Bank, State Farm Bank, Goldman Sachs Bank USA, Marcus by Goldman Sachs, The Bank of New York Mellon, State Street Bank and Trust Company, Citizens Access, Silicon Valley Bank, U.S. Bank National Association, Morgan Stanley Private Bank, Morgan Stanley Bank, Capital One Bank USA, Charles Schwab Premier Bank, TD Bank USA, BNY Mellon, Bank of America California, HSBC Bank USA, The Northern Trust Company, American Express National Bank, UBS Bank USA, Signature Bank, Discover Bank, VirtualBank, Western Alliance Bank, Bank of China, Raymond James Bank, Deutsche Bank Trust Company Americas, BankDirect Capital, Comenity Bank, EmigrantDirect, My Savings Direct, Amboy Direct, Bask Bank, Synchrony Bank, Pacific Western Bank, Barclays Bank Delaware, Commerce Bank, Salle Mae Bank, Stifel Bank and Trust, Cathay Bank, Customers Bank, Green Dot, VioBank, Hancock Whitney Bank
FAQ
Although the basic idea behind a neobank can be simple to understand, there are still many common questions surrounding them. Here are the answers to some of the most frequently asked questions regarding neobanks.
- What are the biggest neobanks?
- Learn more about the biggest neobanks by reviewing our Best Banks list.
- Is a neobank a fintech?
- Best described as a niche fintech, a neobank helps bridge the gap between traditional banks and customers by offering digital banking alternatives. A neobank may operate solely through digital means, but it can accomplish most financial transactions like that of a physical bank branch.
- What is the best digital bank?
- There are several digital banks that are ranked the best for your financial needs, including those with competitive interest rates, low to no fees, convenience and user-friendly access and customer service. Review our Best Banks list to determine which neobanks are ranked accordingly.
- Are any neobanks profitable?
- While neobanks hold 1 billion accounts around the world, according to a 2022 Forbes report, less than 5% are profitable. Where neobanks face the greatest competition is disruption in their space by big banks with digital offerings, described as “disrupting the disruptors.”
- Which neobank is best for couples?
- Whether thinking about using a neobank for yourself or for you and your partner here are some top neobanks to consider: SoFi, Acorns, Betterment, Chime, CUrrent, GO2bank, LendingClub Bank, Revolut, Upgrade, Varo Bank.
- Is PayPal a neobank?
- No, PayPal is not considered a bank or neobank as it does not offer traditional banking account needs nor is it FDIC-insured. It is considered to be a payment platform.
- What is the highest interest rate for neobank?
- Interest rates do range from bank to bank by the banks discretion and also depending on the current economic climate. In this list, GO2Bank, has the highest APY at info-gbr-rate institution=”go-2-bank” product=”Savings”] for its savings account if you have a balance up to $5,000.
- What is the difference between digital banks and neobanks?
- While neobanks operate solely online, digital banks are essentially just an online alternative to traditional banking.
Research Methodology
To determine the Best Neobanks of 2023, GOBankingRates looked at the following factors:
- Monthly fee
- Minimum balance
- Checking fee ratio
- Minimum balance needed in account to earn APY
- Savings APY
- Average mobile app rating between the Android and Apple stores
All factors were scored and combined. Rates and fees are subject to change.
Banks Monitored by GOBankingRates
SoFi, Capital One, NBKC, Bank of America, Chime, Charles Schwab Bank, Axos Bank, Current, First National Bank of Pennsylvania, Citibank, New York Community Bank, First Internet Bank, TIAA, Ally Bank, Truist Bank, Wells Fargo, JPMorgan Chase Bank, Quontic Bank, LendingClub Bank, One Finance, First-Citizens Bank, BMO Harris Bank, FirstBank, Bank 5 Connect, BankUnited, The Huntington National Bank, iGOBanking.com, Arvest Bank, First Interstate Bank, Manufacturers and Traders Trust Company, TD Bank, Zions Bancorporation, USAA Federal Savings Bank, Citizens Bank, Fifth Third Bank, PNC Bank, Pinnacle Bank, Keybank, IncredibleBank, Simmons Bank, Santander Bank, Southstate Bank, Bank of Hawaii, First National Bank of Omaha, Bank of the West, First Hawaiian Bank, Texas Capital Bank, Salem 5 Direct, Umpqua Bank, Synovus Bank, Fulton Bank, Flagstar Bank, Associated Bank, UMB Bank, Valley National Bank, United Community Bank, Washington Federal Bank, Centennial Bank, Prosperity Bank, Ameris Bank, United Bank, Pacific Premier Bank, BOKF, City National Bank of Florida, Midfirst Bank, Frost Bank, TAB Bank, Eastern Bank, FNBO Direct, Cadence Bank, Webster Bank, Old National Bank, Regions Bank, Wilmington Savings Fund Society, MUFG, Union Bank, Bank OZK, First Horizon Bank, CIBC Bank USA, Glacier Bank, Comerica Bank, East West Bank, First Republic Bank, Columbia State Bank, City National Bank, State Farm Bank, Goldman Sachs Bank USA, Marcus by Goldman Sachs, The Bank of New York Mellon, State Street Bank and Trust Company, Citizens Access, Silicon Valley Bank, U.S. Bank National Association, Morgan Stanley Private Bank, Morgan Stanley Bank, Capital One Bank USA, Charles Schwab Premier Bank, TD Bank USA, BNY Mellon, Bank of America California, HSBC Bank USA, The Northern Trust Company, American Express National Bank, UBS Bank USA, Signature Bank, Discover Bank, VirtualBank, Western Alliance Bank, Bank of China, Raymond James Bank, Deutsche Bank Trust Company Americas, BankDirect Capital, Comenity Bank, EmigrantDirect, My Savings Direct, Amboy Direct, Bask Bank, Synchrony Bank, Pacific Western Bank, Barclays Bank Delaware, Commerce Bank, Salle Mae Bank, Stifel Bank and Trust, Cathay Bank, Customers Bank, Green Dot, VioBank, Hancock Whitney Bank
Rates are subject to change; unless otherwise noted, rates are updated periodically. All other information on accounts is accurate as of Apr. 6, 2023.
*Chime is a financial technology company, not a bank. Banking services provided by, and debit card issued by, The Bancorp Bank, N.A. or Stride Bank, N.A., Members FDIC.
1 Banking services and debit card provided by The Bancorp Bank N.A. or Stride Bank, N.A., Members FDIC, pursuant to a license from Visa U.S.A. Inc. and may be used everywhere Visa debit cards are accepted.
2 Out-of-network ATM withdrawal fees may apply except at MoneyPass ATMs in a 7-Eleven, or any Allpoint or Visa Plus Alliance ATM.
3 The annual percentage yield (APY) for the Chime Savings Account is variable and may change at any time. The disclosed APY is effective as of Nov. 17, 2022. No minimum balance required. Must have $0.01 in savings to earn interest.
