19 Neobanks and the Benefits They Provide Advertiser disclosure You’re our first priority. Each time. We believe everyone should be able to make financial decisions without hesitation. While our website doesn’t include every business or financial product on the market, we’re proud of the advice we offer, the information we provide and the tools we create are objective, independent easy to use and free. So how do we earn money? Our partners compensate us. This could influence the types of products we review and write about (and the places they are featured on our website) however it doesn’t affect our advice or suggestions that are based on many hours of study. Our partners do not promise us favorable reviews of their products or services. . 19 Neobanks and What They Offer Neobanks differentiate themselves by focusing on specific communities, providing perks and more. By Spencer Tierney Senior Writer | Certificates of Deposit bank accounts, ethical banking, deposits Spencer Tierney is a consumer banking writer for NerdWallet. He has been writing about finances for individuals since the year 2013, with a particular focus on certificates of deposit and other banking-related topics. He has had his work featured in The Washington Post, USA Today, The Associated Press and the Los Angeles Times, among others. He is based in Berkeley, California. Sep 23, 2021 Edited by Yuliya Goldshteyn Assistant Assigning editor Banking Yuliya Goldshteyn is a banking editor with NerdWallet. She was previously an editor, writer , and research analyst in a variety of industries, ranging from healthcare to market research. She graduated with a bachelor’s degree in the field of history from Berkeley at the University of California, Berkeley and a master’s of social science from University of Chicago. You can reach her at
. The majority of items featured here come from our partners who pay us. This affects the products we feature as well as the place and way the product appears on the page. However, this doesn’t affect our opinions. Our opinions are entirely our own. Here is a listing of . The investing information provided on this page is intended for informational purposes only. NerdWallet is not a broker or advisor. or brokerage services and does not recommend or counsel investors to purchase or sell certain stocks, securities or other investments. Navigate to a specific neobank or category: For high yield savings: widest range of accounts: For cheap overdraft: For • For cash-back rewards: | | Investor-friendly: are financial technology — or fintech — businesses which typically provide mobile-friendly accounts that are brimming with attractive features, such as no-cost credit or cash-back rewards. Certain established neobanks provide loans and credit cards, as well as investment products too. They usually have no branches and, since the majority of them do not have banking licenses, they partner with banks to provide security against the Federal Deposit Insurance Corp. Other things include. All neobanks on this list have FDIC-insured accounts. Savings Cash Manager CD Checking Money Market Member FDIC SoFi Checking and Savings APY 3.75 Members of SoFi with direct deposit have the opportunity to receive up 3.75% annual percentage yield (APY) for savings accounts (including vaults) and 2.50% APY on checking balances. The minimum amount of direct deposit required to qualify for the 3.75% APY for savings, and 2.50% APY on checking balances. Direct deposit members will get 1.20% interest on balances of savings and checking (including vaults). Interest rates are variable and can change at any time. These rates are current as of 01/04/2023. Additional information can be found at http://www.sofi.com/legal/banking-rate-sheet Min. balance for APY: $0 Member FDIC Marcus Online Savings by Goldman Sachs Bank with APY 3.50% 3.50% APY (annual percent yield) with a balance of zero to earn the APY stated. Accounts must have a positive balance in order to be open. APY valid as of 02/07/2023. Min. balance for APY The cash accounts provide a range of services and features similar to savings, checking and investment accounts in one product. Cash management accounts are generally offered by non-bank financial establishments. These cash accounts combine features and services that are that are similar to savings, checking and/or investment accounts in one product. Cash management accounts are usually provided by non-bank financial institutions. on the Wealthfront website. Wealthfront Cash Account APY 4.05% min. balance to APY $1 on the Betterment website. Betterment Cash Reserve – Paid non-client promotion APY 4.00 Percent Annual percent return (variable) is at 02/06/2023. Min. balance for APY CDs is $0 (certificates of deposits) are a type of savings account that comes with fixed rates and terms typically, they have higher interest rates than regular savings accounts. CDs (certificates of deposit) are a type of savings account that has a fixed rate and term which usually come with more interest rates than traditional savings accounts. CIT Bank CD Annual Percentage Yield 4.60% 1.5% Term 1.5 Years FDIC Marcus by Goldman Sachs High-Yield CD APY 4.4 FDIC Marcus by Goldman Sachs High-Yield CD APY 4.40 percent 4.40% APR (annual percent yield) at 01/25/2023. Term One year checking accounts are utilized for cash deposits on a regular basis as well as withdrawals. Checking accounts are used to make cash deposits on a regular basis as well as withdrawals. Members FDIC SoFi Checking and Savings APY 2.50% SoFi members with direct deposit have the opportunity to earn up to 3.75% annual percentage yield (APY) on savings balances (including Vaults) and 2.50% APY on checking balances. There is no minimum direct deposit amount required to qualify for the 3.75 percent APY on savings and 2.50 percent APY on checking balances. Customers who do not deposit direct deposits will earn 1.20 percent APR on all balances in checking and savings (including vaults). The rates of interest are subject to fluctuation and are can change at any point. The rates listed are current at 01/04/2023. Additional information can be found at http://www.sofi.com/legal/banking-rate-sheet Monthly fee $0 Upgrade Rewards Checking APY N/A Monthly fee $0 Deposits are FDIC Insured Current Account APY N/A Monthly fee $0 Deposits are FDIC Insured Chime Checking Account APY N/A Monthly fee $0 Member FDIC Axos Bank(r) Rewards Checking APY 1.25% Receive monthly direct deposits totaling $1,500 or more to earn 0.40% APY. Utilize Your Axos Visa(r) Credit Card to make a maximum of 10 transactions per month (min three dollars per purchase) or enroll for Account Aggregation/Personal Financial Manager (PFM) within Online Banking to earn 0.30 percent APR. Keep an average daily balance of $2,500 per month within the Axos Managed Portfolios Invest Account to earn 0.20 percent annual percentage yield. Maintain an average daily amount of $2,500 in an Axos self-directed trading Investment Account to earn 0.20% annual percentage yield. Make use of your Rewards Checking account to make your entire month’s Axos Consumer loan payment to earn 0.15% APR. Monthly fee $0 Money market accounts pay rates that are similar to savings accounts and include some checking features. Money market accounts have rates comparable to savings accounts and have some checking features. Member FDIC UFB’s Best Money Market APR 4.21% Min. balance for APY $0 FDIC Discover Bank Money Market Account APY 3.20% Min. balance for APY $1. Learn more: The amount of fintech companies that could be referred to as neobanks is growing. From 2018 to 2020 Neobanks have exploded between 60 and 256 around the world, according to a report by the business strategy company Exton Consulting. With more players comes more competition. And some previously innovative services are now becoming common in neobanks, like two-day advance access to direct deposits as well as free access to national ATM networks. And some digital wallets, including and, are competing with Neobanks, offering these same features. Neobanks are finding ways to differentiate themselves by appealing to particular categories, such as freelancers or tourists from other countries, as well as providing advantages that you can’t find at traditional banks. This article will provide an overview of how some new and emerging Neobanks are trying to distinguish themselves. >> Learn more for high-yield savings Chime Founded in 2013, Chime is one of the largest neobanks, with more than 12 million customers. With two banks*, it offers savings and checking accounts, both with no charges for monthly usage, as well as secured credit cards that you can use to establish credit. Chime’s savings accounts offer an attractive interest rate of 2.00 per cent annual percentage yield** , with no minimum balancerequirement, no maximum amount for earning interest and no monthly fees. (The Chime Savings Account must be opened to create a savings account, while savings Account is available as an optional.) The account for spending gives access to more than 60,000 ATMs*** across the country, and for customers with direct deposits, there is a no-cost overdraft program covers the amount of $200. Cash deposits are available at big retailers ****, a service not all neobanks provide. The process of signing up can be easier than at traditional banks since there’s no check on credit or bank records from the past however, Chime offers a . Learn more about Chime Chime: “Chime is a financial technology firm, not a bank. Banking services are offered by The Bancorp Bank, N.A. and Stride Bank, N.A., Members FDIC.” *” The Annual Percentage Yield (“APY”) for the Chime Savings Account is variable and may alter at any moment. The disclosed APY is effective from October 25 2022. No minimum balance required. It is required to have $0.01 of savings in order to receive interest. ” ***”Out-of-network ATM withdrawal charges could apply, except for MoneyPass ATMs at 7-Eleven, or any Allpoint and Visa Plus Alliance ATM.” ****”The retailer who takes your cash is accountable for the transfer of the cash for deposit into your Chime Account. Account. There may be fees for cash deposits when you use a different retailer that Walgreens.” Review Chime reviews: Return to Top Varo Bank Varo Bank offers checking, savings and cash advances. Founded in 2015 and originally operating with partnership with banks, the bank became an officially chartered institution in August of 2020. This allowed it to offer the services of its own FDIC insurance. Per Varo the bank had 6 million customers as of mid-year 2022. The checking account is access to a free ATM access and no monthly fees, plus advantages like cash back at specific retailers as well as no international transaction fees. Its savings account has two requirements to earn the highest rate of 5.00% APY on the first $5,000 of savings, which includes a $1,000 minimum in monthly direct deposits, and maintaining an open checking and savings balance at the end of the month. If not, it’s 3.00 percent per annum. Read Varo review Return to top for widest selection of accounts SoFi SoFi is abbreviation in the sense of “Social Finance” began as a student loan refinance business, but has recently received an own charter for a bank. The SoFi Savings and Checking account is its account that can be used to manage the money to spend and save. There are no fees for account usage, for overdrafts, ATM usage, or monthly maintenance (subject to changing at any time). Certain benefits include earning interest, establishing savings accounts as well as, for customers with the right direct deposit, free overdraft coverage that can be up to $50. SoFi also offers many types of loans that are active and automated investing, cryptocurrency trading, credit cards, and retirement accounts. to top for a low-cost overdraft One Owned by Walmart, One’s banking account comes with a low-cost overdraft program, custom-designed budgeting and savings choices. Customers can choose to divide their cash into pocket-sized accounts, also known as subaccounts. The pockets that are dedicated to saving have rates of 1percent for up to $5,000 for every customer and 1% for up to $25,000 for customers who deposit direct. One gives free overdraft coverage up to $200 for customers who deposit direct at least $500 monthly. It’s less expensive than the big banks charge for overdrafts that can range from $35 per transaction. Read Previous page> Learn more about For Credit Building GO2bank (and GoBank) Green Dot Corporation has been offering alternatives to banking since. From prepaid debit cards It expanded to GoBank, its very first bank online GoBank which was launched in 2013, and its second bank brand, GO2bank, in 2021. The majority of Green Dot deposit accounts are federally insured by Green Dot Bank. In contrast to most neobanks which require online registration for customers, you can get GoBank as well as GO2bank cards at retailers like Walmart and then activate them on the internet to use with a mobile app. Between the two brands, GO2bank is the best alternative, as it has a lower monthly cost and more benefits, though less than other neobanks, such as Chime and Varo. GoBank’s $9 per month fee is waived by $500 direct deposits. GO2bank’s $5 monthly fee is waived with direct deposits without a minimum. In addition to the bank account, GO2bank provides a secured credit card that can be used to improve credit scores and also an account for savings that earns an APY of 1% for the amount of up to $5, 000. Contrary to this, GoBank doesn’t offer a credit card and its savings vault does not generate interest. Read GoBank review: Read more about GO2bank. Return to the top Sesame Cash The credit firm Credit Sesame launched a free digital bank account in March 2020 that concentrates on helping those who live pay-to-pay. The account’s benefits include direct-deposited paychecks up to two days earlier, cash and mobile check deposits, a limited cash-back on debit cards, and free access to a nationwide ATM network. The account’s users are able to access Credit Sesame’s free monitoring of credit scores and regular updates to credit scores. • Compare the Top to Back MoCaFi MoCaFi, also known as Mobility Capital Finance is Black-owned digital platform started in 2016 that provides free checking to serve people who are largely unbanked and unbanked, with a focus on closing the wealth gap between racial groups. The platform offers a bill-pay feature that lets customers report rent payments to major credit bureaus to establish credit histories. As a rare perk, MoCaFi collaborates with third-party partners to offer cash-free deposits at a variety of retailers and free mobile check deposits that allow for quick withdrawal of funds. Return to Top Dave Dave started in 2017 as a company that offered a pay advance and grew to include an entire checking account. By mid-2021, the company had more than 10 million customers. You can get a small advance on your next pay without any interest or credit check, and those with at least $1,000 in direct deposits per month can build credit history through rent payments. Dave also provides budgeting services that incorporates upcoming bills as well as the option to search for jobs that are not listed through its mobile app. There are no charges for overdrafts , or using ATMs that are part of the nationwide MoneyPass network, and there are no minimum amount of balance required. Read the Dave review Return to top cash-back rewards Current Current, founded in 2015, provides free and premium options for checking with cash back at some merchants, two-day direct deposit, as well as quick refunds on gas station debit hold on cards. These two benefits are only available for premium accounts, which have an annual fee of $5. Premium accounts that have direct deposits can also have the possibility of having up to $100 worth of overdrafts backed up at no cost. Check out the Current review: Return to the top Upgrade The personal loan company Upgrade was founded in 2017, launched a free checking account for customers in 2021, with cash-back rewards that are more generous than Current’s. The main benefits offered by Upgrade to their checking customers include cash-back of 2% on everyday purchases such as at drugstores and restaurants, and up to 20% rate reductions for personal loans. Customers can also view their credit scores free and summaries of their credit reports through Upgrade’s Credit Health service. Review Upgrade’s reviews:Return to top of the page Bella Bella’s approach to banking is, in the words of its website, “built on love.” This translates into an account reward program for checking accounts that gives a random percent of cash back between 5% and 200 percent, on selected purchases. Launched in 2020, Bella doesn’t charge monthly ATM, overdraft, or ATM charges. Currently, Bella also covers fees for out-of-network ATM operators. Also, there is a free savings account, which offers low interest rates as well as an alternative “karma account,” which can be used to help pay for smaller purchases made by other customers or as a beneficiary of another’s karma account generosity. Check out this list for the Back to top Cheese Started in March 2021, Cheese is able to tailor its digital banking platform to the immigrants and Asian American communities with up to 10% cash back at 10,000 businesses, including restaurants and Asian-owned businesses. Customer support is available in English as well as Chinese as well as other languages soon. Accounts accrue interest and don’t incur monthly fees or ATM charges in the national MoneyPass ATM network. Learn the details regarding Back to top Investor-friendly Acorns The microinvesting app Acorns principal product is an automated investment for those who prefer not to be hands-on The company expanded its banking offerings in the year 2018 with Acorns Checking. The account includes a debit card and limited rewards program and is available in a bundle that includes an investment account that is tax deductible as well as individual retirement accounts at a cost of $3 per month (or the equivalent of $5 per month for a family-friendly version). Customers can opt in to the “round-up” feature where each purchase is rounded by a certain amount and that change is then invested. The rewards program allows customers to receive an amount or a portion back from purchases at over 300 companies. The money can also be invested. Read Acorns review: Back to top Aspiration Aspiration can be described as an online broker company with an account for cash management, called Spend & Save, that functions as the hybrid savings and checking account. There are two types of this account. The standard Spend & Save account has up to 3.00% APR on savings, up to 5% cashback and an optional monthly fee which customers pay as they consider fair starting at the point of zero up to. The higher-end Aspiration Plus plan comes with an almost-$72 annual fee, as high as 10% cash back in addition to 5.00 percent APR. Two accounts are available also, which allows you to invest in companies with sustainable business practices and social causes. As an accredited B Corp company, Aspiration is committed to being a socially responsible and environmentally conscious company and provides customers with individual sustainability scores that are based on which businesses they spend money at. Read Aspiration review: The Aspiration Spend and Save Accounts manage cash account that are available through Aspiration Financial, LLC, registered broker-dealer, member of FINRA/SIPC and a subsidiary that is part of Aspiration Partners, Inc. (“Aspiration”). Aspiration is not a financial institution.” The Aspiration Save Account’s 5.00 percent annual percentage yield (“APY”) that can be up to 83x the national interest rate is variable, subject to change, and only available to customers who are enrolled in Aspiration Plus once the conditions are met. Customers who aren’t enrolled in Aspiration Plus receive 3.00 percent APY once conditions are fulfilled. Then they can go back to the top. Albert Albert started in 2016 as a financial management app and launched a personalized banking service named Albert Cash in August 2021. It currently has more than six million customers. Albert Cash is a banking account that pays cash back and includes the following advantages: no-interest cash advances up to $250 as well as integrated budgeting and savings tools and annual savings bonus that can reach 0.10%. To access Albert’s investing feature and earn an interest rate of 0.25% and use its personal customer service known as Genius, there’s a minimum monthly fee of $4. You need to have an external bank account to establish an account with Albert. Return to top Traveler-friendly Revolut In its first year of operation the UK-based Revolut offers attractive features for travellers from abroad who are looking for competitive exchange rates and an account that allows use more than 150 currencies. Customers can transfer funds abroad together with other Revolut users, withdraw as much as $300 per month from ATMs at no cost and earn the interest from savings. That’s all with the account that is free. For additional benefits, like overseas medical insurance, Revolut offers two accounts with monthly fees of $10 and $17. Read Revolut reviews: Revolut reviews: Wise Revolut U.K.-based money transfer company Wise which was previously known as TransferWise has created a multicurrency account that rolled across to U.S. customers in 2017. There’s an initial $9 fee to use the card as a debit, Wise doesn’t charge monthly charges for account usage and can convert currencies at an affordable exchange rate with a small upfront fee. Converting a balance of $1,000 U.S. dollars to euros, for example, costs approximately $4.20 or 0.42 percent that’s less expensive than institutions’ foreign-transaction costs between 1% and three percent. An account can have multiple balances and hold at least 54 foreign currencies at once and converting could be as quick as a matter of seconds. Check out Wise review: Back to the top of Freelancer-friendly Oxygen Launched in early 2020 the Oxygen digital banking account will help freelancers as well as self-employed employees manage their money flow. Oxygen doesn’t have monthly or ACH or overdraft fees, but there are four pricing tiers that can be used for the account. They range from zero to $200 per year. All levels offer travel benefitslike the loss of luggage as well as hotel theft protection. higher levels come with more benefits that include more savings rates, higher cash back and numbers of virtual cards. One unusual perk is the ability to use the Oxygen application to incorporate, or legally register as a company, and then . Review Oxygen review: Back to top Lili launched in the year 2019. Lili is a mobile banking account specifically designed for freelancers and contractors in mind. With Lili, you can categorize your expenses simply by swiping left to indicate “life,” or personal, and right to indicate “work,” or business. Lili offers tools that help freelancers save to pay taxes and also an emergency fund. Additionally, if you make use of Lili’s account to pay your earnings through online platforms and payment apps you will receive the funds as early as two days before the due date. This last feature is common across a variety of neobanks. Check out Lili review Return to the top Neobanks coming soon Keep an eye out for the emergence of these four Neobanks in the near future. Daylight: Previously known as be Money, Daylight plans to launch a mobile bank account specifically targeting people in the LGBT+ community with features like access to financial coaches and accounts that are based on a person’s chosen nameinstead of its legal title. Greenwood is a Black-owned digital banking firm currently has around half million clients waiting on its list for spending and savings accounts which are geared towards reinvesting their wealth into Black as well as Latinx communities. (See our list of the upcoming and existing .) First Boulevard The Black-owned bank platform focuses on low-cost bank, with cash back at businesses owned by Blacks, as well as brief financial education videos. Its goal is to build generational wealth that is accessible to Black Americans. Purple: Purple plans to offer mobile banking specifically designed for the disability community with an account for checking and a tax-advantaged savings account called ABLE accounts. These accounts allow people with disabilities save money, without losing any government assistance. There will also be a debit card that sends a portion of Purple’s revenue for the Special Olympics. Return to top From credit tracking tools to travel perks modern checking accounts offer more than their predecessors offered. Before getting one, check whether the fintech firm is a bank, or is in partnership with a bank. You can also see which features would best suit your needs in the financial realm. Author bio Spencer Tierney is an expert in certificates of deposit at NerdWallet. Its work was featured by USA Today and the Los Angeles Times. Similar to… Discover a better savings account See NerdWallet’s picks for the best high-yield savings accounts on the internet. Go deeper into Banking Make smarter money decisions – straight to your inbox. Sign-up and we’ll email you Nerdy content on the topics in finance that matter most to you as well as other methods to help you make more from your savings.
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