Compare digital banks in the US

Like many other parts of our lives, banking is becoming increasingly digital. The US has a number of new digital banks, also called neobanks, promising to revolutionize the financial industry through the use of world-class technology and digital services. But are they worth the hype?

Learn about some of the new banks on the block and what makes them different.

What is a digital bank?

Like the name suggests, a digital bank operates digitally, usually from an app, rather than from a physical branch or office. A digital bank is a fairly loose term — the correct industry name for these banks is a neobank.

A neobank is a completely digital bank that doesn’t use any existing legacy systems to operate. This means the bank doesn’t use any physical infrastructure or digital operating systems that are already being used by existing financial institutions. The technology used by these fully digital banks is developed from scratch.

Compare digital banks in the US

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Name	Product	APY	ATMs	Fee
Simple		2.02% on balances of $2,000+ 0.01% on balances of $0 to $1,999	40,000 AllPoint ATMs in Simple’s network	$0	Banking and budgeting in one simple app.	More Info	Compare	loading Fetching your data...
Chime Spending account		0.01%	38,000 fee-free ATMs nationwide	$0	No overdraft fees. No monthly maintenance fees. No monthly service fees. No minimum balance fees. No deposit required. No foreign transaction fees. Over 38,000+ fee-free MoneyPass ATMs.	More Info	Compare	loading Fetching your data...
GoBank			42,000 ATMs nationwide	$8.95/month (can be waived)	GoBank provides tools to help you build a budget and stick to it. No overdraft fees. Monthly and other fees apply.	More Info	Compare	loading Fetching your data...
Moven			42,000 ATMs across the country	$0	Moven automatically analyzes your spending and gives you instant receipts and insights so you can spend, save and live smarter.	More Info	Compare	loading Fetching your data...
BankMobile Vibe			Over 55,000 fee-free Allpoint ATMs	$2.99/month (can be waived)	An account designated specifically for students with access to over 55,000 fee-free Allpoint ATMs, money management tools and a one-of-a-kind recognition program.	More Info	Compare	loading Fetching your data...
Varo			55,000 AllPoint ATMs around the world for free	$0	No monthly fees. No foreign transaction fees. No fees at 55,000+ Allpoint ATMs.	More Info	Compare	loading Fetching your data...

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What other digital banks will be launching in the US?

There are a number of digital banks operating overseas that plan to launch in the US in the future, including:

• N26. This German challenger bank lets you divide your money up into Spaces, or subaccounts, to help you budget and save. N26 plans to launch in the US — a date hasn’t been announced yet, but you can sign up on the website to get early access.
• Revolut. This UK-based bank was created with travelers in mind, offering low fees for international purchases, withdrawals and money transfers. Revolut’s US launch date hasn’t been announced yet, but you can sign up for their waitlist online.
• Glint. This UK-based banks brings an old concept into the digital age. Glint lets you store your money as gold so that it’s less vulnerable to the economic factors than can impact a country’s currency. US customers can already use the app to buy gold, but Glint plans to launch a debit card that allows you to spend your gold or exchange it for US currency at an ATM in the near future.

What’s the difference between a digital bank and a traditional bank that’s available online?

Many banks in the US appear to be digital banks — they don’t have branches and customers use mobile banking apps to control their money. However, just because a bank doesn’t have branches and offers a range of digital products and platforms doesn’t mean it’s a digital bank or a neobank. These online-only banks are built on existing infrastructure and closely mimic traditional banks, but true digital banks utilize new technology to create innovative banking solutions.

Online banks aren’t 100% digital banks

Many people refer to American Express and Discover as digital banks because they don’t have any physical branches. However, these banks aren’t neobanks because they rely on existing banking infrastructure and operate like a traditional bank.

Are digital banks safe?

Digital banks need to have the same banking licenses and approvals as existing US banks before they’re able to offer products and services to consumers. These new banks will be regulated by the Federal Deposit Insurance Corporation (FDIC) and the US Securities and Exchange Commission (SEC) in the same way that existing banks are regulated.

Your deposit of up to $250,000 with an FDIC-insured bank is protected by the US government. This means if something were to happen to the bank, your money (up to this amount) would be safe. Note that some of the digital banks mentioned in this guide are not yet considered banks and haven’t yet been licensed or FDIC-insured.

How to get started with a digital bank

If you’re interested in joining one of these new digital banks, you can join their waitlist by visiting their website. When they launch products, those on the waitlist will be the first to know and the first to receive access to these new products.

What is app-based banking?

App-based banking is any sort of financial institution or tool that you control primarily through an app. There are several advantages to app-based banking:

• Banking access in your pocket
• Many companies offer 24/7 access to banking support
• Instant spending notifications
• Many banking apps offer ways to automatically save money

Things to know about app-based banking

Using your phone as your main point of contact with your bank can save you time and give you more control over your finances, but there are a few things to be aware of.

• Some apps require credit checks

  If you’re planning to apply for a new checking account or credit card, your bank may pull your credit file in order to assess how likely you are to overdraw the account.

• Your money may not be protected the same way it is with big banks

  Most banks are insured by the FDIC, which means your deposit of up to $250,000 is backed by the US government. Not all app-based banks have this same protection. You can use the FDIC’s BankFind tool to learn if your bank is FDIC insured.

• App-based banking doesn't always afford the same rewards as traditional banks

  App-based banks aren’t always able to offer the financial rewards, such as signup bonuses, that are common at many big banks.

• If you forget your PIN or lose your card, most app-based banks won't panic

  A benefit of an app-based bank is having full access to your account at all times. Lots of app-based banks allow you to freeze your account if you lose your card, so if you find it again you can just unfreeze the card in the app. If you forget your PIN, you may even be able to answer security questions in the app.

• Some banking apps link to your pre-existing bank accounts and show you ways to spend better

  Not all app-based banks are banks in the traditional sense. Some banking apps work alongside your pre-existing accounts to gather all your spending data in one place, offer you insights into the way you spend your money and suggest ways to improve your finances.

Different types of app-based banking

App-based banking encompasses a lot of different financial products, including:

• Digital banks. Digital banks rely on new, innovative technology and are generally app-based.

• Traditional bank apps. App-based banking doesn’t only apply to neobanks, it’s also becoming increasingly possible to bank on your smartphone with traditional banks such as Chase and Bank of America, both of whom have highly-rated mobile apps where you can control your money.
• Apps that help you save. One of the most common reasons for people heading away from traditional banks and towards app-based banking is how easy app-based banking makes it for people to save money. This includes everything from budgeting apps like Cleo to cashback apps like Ibotta.
• Prepaid card apps. Companies like NetSpend let you control a prepaid debit card from an app so you can track your transactions and see exactly how much money you have left.
• Investment apps. Apps like Robinhood and Acorns let you invest in stocks from your phone so that you have more control over your finances.

Bottom line

Digital banks are getting a lot of hype right now, and for good reason. They often cater to specific niches and groups and they’re known for offering innovative apps. But before you ditch your current bank, take the time to read through all of the fine print to make sure the bank you’re interested in is as good as it sounds.

Frequently asked questions

• How can I tell if a bank is insured by the FDIC?

  Use the FDIC’s searchable database to find out if a bank is FDIC-insured.

• How do I get help if there are no bank branches?

  Digital banks often have multiple ways to contact customer service, including via online chat, email and phone. Check with the bank you’re interested in to find out how they handle customer support before signing up.

• Why does the US version of the bank I'm interested in offer less features?

  Overseas banks that come to the US aren’t always able to offer the same features to US users. In some cases the bank will roll out new features as it expands, but not always. Banking regulations vary from country to country, making it difficult to offer the same features in every country.

Alison Banney

Alison Banney is the senior banking and investments writer at Finder. She has written about finance for over five years with her work featured on sites including Yahoo Finance, Dynamic Business and Koshie's Business Builders. She has previously worked at Westpac, and has written for several other major banks including BCU, Greater Bank and Gateway Credit Union. Alison has a Bachelor of Communications from Newcastle University and a Tier 1 RG146 Generic Knowledge Certification for financial advice.