SUBSCRIBE & SAVE Less than $3 per week View Profile The Explainer Talking Points The Week Recommends Newsletters From the Magazine The Week Junior Food & Drink Personal Finance All Categories Newsletter sign up Personal Finance the explainer The pros and cons of online-only banks You can get your finances in order without getting off your couch Newsletter sign up You do everything else online — why not your banking? (Image credit: d3sign / Getty Images) Becca Stanek, The Week US 14 April 2025 We do just about everything online these days — shopping, staying in touch with friends, syncing up for work meetings and even dating. So it is only natural that banking should follow suit. Online-only banks provide many of the same services as traditional banks, but they lack the option of in-person interactions at branch locations, offering websites and mobile apps instead. While banking online boasts the obvious convenience of getting your finances in order without leaving the comfort of your couch, there are some considerations worth noting before switching banks. What are the upsides of online banking? Let's start with the pros of online banking, as there are a number worth noting: Subscribe to The Week Escape your echo chamber. Get the facts behind the news, plus analysis from multiple perspectives. SUBSCRIBE & SAVE Sign up for The Week's Free Newsletters From our morning news briefing to a weekly Good News Newsletter, get the best of The Week delivered directly to your inbox. From our morning news briefing to a weekly Good News Newsletter, get the best of The Week delivered directly to your inbox. Convenience. Perhaps the most obvious benefit of banking online is convenience. Banking this way "is a big time-saver that lets you avoid trips to the bank and waiting in drive-thru lanes or lobby lines," said Bankrate. Potentially higher interest rates. "At online banks, deposit accounts tend to have higher annual percentage yields," said NerdWallet. For comparison, high-yield savings accounts offered at online banks can offer "APYs around 5%," whereas some of the big brick-and-mortar banks "have savings accounts that earn only 0.01% APY." Often lower (and fewer) fees. Alongside better rates, "you're less likely to be dinged with a wide range of fees at a direct bank including those associated with keeping an account open with a low balance, making direct deposits or paying by check or debit card," said Investopedia. User-friendly websites and apps. While of course user experience can vary widely from bank to bank, in general, "most" online banks "have safe, sophisticated websites that make it easy to open an account, pay bills and track and manage your money from anywhere," said Bankrate. Plus, "online-only banks might have mobile apps with more robust features than traditional banks' apps," said U.S. News & World Report. Are there drawbacks to online-only banks? As mentioned, banking exclusively online can have its downsides. These include: No access to certain services. Not only will you not have the option for a face-to-face interaction if you need banking help, you may not be able to access all the same services with an online bank as with a brick-and-mortar bank. Services that may not be available online can include "getting a cashier's check or renting a safe deposit box," said U.S. News & World Report. Potential difficulties with cash deposits. Since "there are no locations for customers to visit, depositing cash can be challenging," said SmartAsset. Often, you may find that attempting this with an online bank "will cost more time and money than it would with a traditional bank." More limited product lineup. "The number of products tends to be more limited at online banks," said Bankrate, and "some only offer a few types of accounts," such as checking and savings but no certificates of deposit (CDs) or loans. In other words, if you are hoping to do all your banking in one place, you may need to turn to a traditional bank (though there are some online banks that are exceptions). Explore More Personal Finance Sign up for Today's Best Articles in your inbox A free daily email with the biggest news stories of the day – and the best features from TheWeek.com Contact me with news and offers from other Future brandsReceive email from us on behalf of our trusted partners or sponsorsBy submitting your information you agree to the Terms & Conditions and Privacy Policy and are aged 16 or over. Becca Stanek, The Week US Social Links Navigation Becca Stanek has worked as an editor and writer in the personal finance space since 2017. She previously served as a deputy editor and later a managing editor overseeing investing and savings content at LendingTree and as an editor at the financial startup SmartAsset, where she focused on retirement- and financial-adviser-related content. Before that, Becca was a staff writer at The Week, primarily contributing to Speed Reads. Why won't Apple make iPhones in America? Today's Big Question Trump offers a reprieve on tariffs, for now ByJoel Mathis, The Week US Published 14 April 25 Why the GOP is nervous about Ken Paxton's Senate run Today's Big Question A MAGA-establishment battle with John Cornyn will be costly ByJoel Mathis, The Week US Published 14 April 25 'This division is not merely economic; it is also ideological' Instant Opinion Opinion, comment and editorials of the day ByJustin Klawans, The Week US Published 14 April 25 You might also like Considering quitting your job? Here's what to do first. 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