19 Neobanks and What They Offer Advertiser disclosure You’re our first priority. Each time. We believe that everyone should be able to make financial decisions with confidence. And while our site does not include every company or financial product that is available on the market however, we’re confident that the guidance we offer as well as the advice we offer and the tools we develop are independent, objective simple, and free. So how do we make money? Our partners compensate us. This may influence which products we write about (and the places they are featured on the website) However, it doesn’t affect our advice or suggestions that are based on hundreds of hours of study. Our partners do not promise us favorable ratings of their goods or services. . 19 Neobanks and what they offer Neobanks stand out by focusing on certain communities, offering various advantages and benefits. By Spencer Tierney Senior Writer | Certificates of Deposit bank accounts, ethical banking, deposit accounts Spencer Tierney is a consumer banking writer for NerdWallet. He has written about personal finance since 2013 with a particular focus on certificates of deposit as well as other banking-related issues. He has had his work highlighted on The Washington Post, USA Today, The Associated Press and the Los Angeles Times, among other publications. He’s based within Berkeley, California. Sep 23rd, 2021 Edited by Yuliya Goldshteyn, Assistant Assigning Editor — Banking Yuliya Goldshteyn is a bank editor at NerdWallet. She has previously worked as an editor, writer and research analyst in various industries that range from health care to market research. She received a bachelor’s level degree in history at University of California, Berkeley. University of California, Berkeley and a master’s in social sciences from the University of Chicago. She can be reached at
. Many or all of the products we feature are made by our partners, who pay us. This affects the products we write about and the location and manner in which the product appears on a page. But, it doesn’t affect our opinions. Our views are our own. Here is a listing of . The information on investing provided on this page is for educational purposes only. NerdWallet does not provide advisory or brokerage services, nor does it recommend or suggest investors buy or sell certain securities, stocks or other investment options. Jump to a specific neobank or category: For high yield savings: For widest selection of accounts: low-cost overdrafts: for credit building: | | Investor-friendly: Freelancer-friendly: are financial technology (also known as fintech) businesses that usually offer mobile-oriented accounts that have attractive features, such as no-cost cash-back rewards or credit. There are some established Neobanks that offer loans, credit cards or investing products, too. They typically operate without branches and, since the majority of them lack banking licenses, partner with banks to offer protection by the Federal Deposit Insurance Corp., among other things. All neobanks on this list have FDIC-insured accounts. Saves Cash Management CD-checking Money Market Member FDIC SoFi Savings and Checking APY 3.75 Members of SoFi with direct deposit are eligible to get up to 3.75 per cent annual percentage yield (APY) for savings accounts (including vaults) and 2.50 percent APY on their checking balances. The minimum direct deposit amount required to qualify for the 3.75 percent APY on savings and 2.50% APY for checking balances. Direct deposit members will earn 1.20 percent APY on all account balances of savings and checking (including Vaults). Rates of interest are subject to change and may 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 by Goldman Sachs Online Savings Bank with APY 3.50% 3.50% Annual Percentage Yield (annual per cent yield) with a balance of zero to earn the stated APY. Accounts must be in positive balance in order to be open. APY current as of 02/07/2023. Min. balance for APY Cash accounts are $0 and combine services and features similar to savings, checking and investment accounts in one product. The cash management account is generally offered by non-bank financial institutions. These cash accounts combine features and services that are similar to checking, savings and investment accounts in one account. These accounts for managing cash are typically offered by non-bank financial institutions. on the Wealthfront website. Wealthfront Cash account APY 4.05 percent min. Balance for APY $1 on the Betterment website. Betterment Cash Reserve – Paid non-client promotions APY 4.00 percent annually percentage yield (variable) is as of 02/06/2023. Min. balance for APY CDs is $0 (certificates of deposit) are a kind of savings account that has a fixed rate and term typically, they have higher interest rates than regular savings accounts. CDs (certificates of deposit) are a type of savings account that comes with a fixed rate and term which usually come with more interest rates than standard savings accounts. CIT Bank CD APY 4.60% Term 1.5 year Members FDIC Marcus by Goldman Sachs High-Yield CD APY 4.40 percent 4.40% APY (annual percent yield) as of 01/25/2023 . 1-year Checking account are used for day-to-day cash deposits and withdrawals. Checking accounts are used to deposit cash on a daily basis and for withdrawals. Member FDIC SoFi Savings and Checking APY 2.50% SoFi members with direct deposit are eligible to get up to 3.75 per cent annual percentage yield (APY) on savings balances (including Vaults) and 2.50% APY on check balances. No minimum amount for direct deposits that is required to be eligible for 3.75% APY on savings and 2.50 percent APY on checking balances. Customers who do not deposit direct deposits will get 1.20 percent APY on all account balances of savings and checking (including vaults). The rates of interest are subject to fluctuation and are subject to change at any time. These rates 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. Make use of the Axos Visa(r) debit card to make 10 transactions each monthly (min $3 per transaction) or sign up for Account Aggregation/Personal Financial Manager (PFM) through Online Banking to earn 0.30% APR. Maintain an average daily balance of $2,500 on the Axos Managed Portfolios Invest Account in order to receive 0.20 percent annual percentage yield. Keep an average daily balance of $2,500 in an Axos Self Directed Trading Invest Account for 0.20 percent APY. Make use of the Rewards checking account to pay the full each month Axos consumer loan payment to earn 0.15% APR. Monthly fee $0 Money market accounts pay rates that are similar to savings accounts, and come with certain checking features. Market accounts earn rates similar to savings accounts and have some checking features. Members FDIC UFB’s Best Money Market APR 4.21 Percentage Min. balance for APY 0 Member FDIC Discover Bank Money Market Account APY 3.20 0.20 % Min. balance for APY $1. Read more: The amount of fintech firms that can be referred to as neobanks is growing. From 2018 to 2020, Neobanks grew by 60-256 around the world according to a study by the business-focused strategy firm Exton Consulting. With more players comes more competition. And some previously innovative services are now becoming common for neobanks. These include two-day advance access to direct deposits and free access to nationwide ATM networks. Digital wallets, including and , are competing with neobanks by offering some of these same features. Neobanks are finding ways to distinguish themselves by appealing to particular people, like freelancers and international travelers, or by offering benefits that aren’t available at traditional banks. This article will provide an overview of the ways that some of the upcoming and current Neobanks are trying to distinguish themselves. >> Learn more for high-yield savings Chime was established in 2013 Chime is one of the largest neobanks, with more than twelve million clients. It is partnered with two banks*, it provides checking and savings accounts, both without charges for monthly usage, as well as a secured credit card you can use to establish credit. Chime’s savings account has a competitive interest rate of 2.00 per cent annual percentage yield** , with zero minimum balances, no maximum amount for earning interest, and no monthly costs. (The Chime Checking Account will be required in order to create a savings account, while The Savings Account is optional.) The account for spending gives free access to more than 60,000 ATMs across the country as well as for customers who have direct deposits, they can benefit from a cost-free overdraft program that covers the amount of $200. Cash deposits are available at large retailers ****, and is not a feature that all neobanks provide. Sign-up procedures are more straightforward than with traditional banks because there is no check on credit or bank records from the past However, Chime is an . Learn more about Chime Chime: “Chime is a financial technology company, not a banking institution. Services for banking are provided by The Bancorp Bank, N.A. as well as Stride Bank, N.A. Member FDIC.” *” The Annual Percentage Yield (“APY”) for the Chime Savings Account is variable and may change at any time. The APY disclosed is in effect as of October 25 2022. No minimum balance required. It is required to be in possession of $0.01 of savings in order to receive interest. ” ***”Out-of-network ATM withdrawal charges are applicable, except for MoneyPass ATMs at 7-Eleven store, or at any Allpoint or Visa Plus Alliance ATM.” ****”The retailer that receives your cash will be accountable for the transfer of funds to deposit into your Chime Checking Account. Cash deposit fees may apply when you use a different retailer that Walgreens.” Check out Chime reviews: To the page Varo Bank Varo Bank offers savings, checking, and cash advances. Established in 2015, and initially operating with banking partnerships. It became an officially chartered bank in the month of August, 2020, which allowed it to provide its very own FDIC insurance. According to Varo its website, it had a total of 6 million customers by mid-year 2022. The checking account comes with no cost ATM access, as well as no monthly fees, in addition to advantages like cash back at specific retailers with no transaction charges. The savings account comes with a couple requirements to earn the highest rate of 5.00 percent APY for the first $5,000 of savings, which includes a $1,000 minimum in monthly direct deposits as well as an open checking and savings balance at the end of the month. If not, it’s 3.00 percent per annum. Read Varo review: Back to top For widest range of account types SoFi SoFi — which stands in the sense of “Social Finance” — started out as an student loan refinance business, but has recently gained an own charter for a bank. SoFi checking and savings is its account that can be used to manage funds for saving and spending. It has no account fees for overdrafts, ATM usage, or monthly maintenance (subject to changes at any point). There are perks like earning interest, opening savings accounts as well as, for customers with the right direct deposit, free overdraft protection that can be up to $50. SoFi also offers a range of loans, active and automated investing as well as cryptocurrency trading, credit cards, and retirement accounts. Review SoFi: — Back to top for a low-cost overdraft One is owned by Walmart, One’s banking account offers a low overdraft program, customized savings and budgeting options. It offers customers the ability to arrange their funds into pockets, which are subaccounts that can be referred to as Pockets. The Pockets dedicated to saving offer rates of 1percent for up to $5,000 per customer and 1% for up to $25,000 for those who deposit direct. One provides fee-free overdraft coverage as high as $200 for customers who deposit direct at least $500 per month. That’s cheaper than big banks charge for overdrafts which range from around $33 per transactions. Read One reviews: Previous pageMore information about credit building GO2bank (and GoBank) Green Dot Corporation has been offering alternatives to banking since. Starting with prepaid debit cards It expanded to the first online bank in GoBank, in 2013 and its second bank brand, GO2bank, in 2021. The majority of Green Dot deposit accounts are federally insured by Green Dot Bank. Contrary to many neobanks that require an online sign-up for customers, you can get GoBank and GO2bank debit cards from retailers like Walmart and sign them up on the internet to use with a mobile app. The two brands are comparable, but GO2bank is easily the better choice, with a lower monthly cost and more benefits, though less than other neobanks such as Chime and Varo. GoBank’s almost $9 monthly fee is waived by $500 direct deposits, whereas the GO2bank’s fee of $5 per month is waived with direct deposits without a specified minimum. Alongside its bank account GO2bank offers a secured credit card that can be used to improve credit scores and also a savings vault that earns an APY of 1% for up to $5,000. Contrary to this, GoBank doesn’t offer a credit card and its savings vault doesn’t earn interest. Check out the GoBank review: Learn more about GO2bank. Return to the top Sesame Cash The credit firm Credit Sesame launched a free digital bank account in March of 2020. It is geared towards helping people live pay-to-pay. The account’s benefits include direct-deposited paychecks that can be made up to two days early as well as mobile and cash deposits, a limited cash-back on debit cards, and free access to a nationwide ATM network. Through the account, users have access to Credit Sesame’s free monitoring of credit scores and regular updates to credit scores. >> Compare the Back to top MoCaFi MoCaFi, or Mobility Capital Finance. It’s a Black-owned digital platform that was launched in 2016 and offers free checking to serve the majority of communities that are unbanked or underbanked and focuses on closing the racial wealth gap. The platform offers a bill-pay feature that lets customers submit rent payments to major credit bureaus to establish credit histories. As a rare perk, MoCaFi works with its third-party partners to give cash-free deposits at a variety of merchants and also free mobile check deposits with fast withdrawal of funds. Back to top Dave Dave started in 2017 as a company that offered a pay advance and grew to include an entire checking account. By the middle of 2021, it had around 10 million customers. You can receive a small cash advance from your next salary without any interest or credit check, and those who have at least $1,000 in direct deposits per month are able to build credit history by making rent payments. Dave also provides budgeting services that includes upcoming expenses and the capability to look for side-jobs in its mobile app. There are no charges for overdrafts , or using ATMs that are part of the nationwide MoneyPass network, and there aren’t any minimum balance requirements. Read the Dave review Return to top for cash-back rewards Current Current, founded in 2015, provides free and premium checking options that include cash back at some merchants, two-day direct deposit, and fast refunds on gas station hold on cards. These two benefits are only available on premium accounts, which have the cost of $5 per month. Premium accounts that make direct deposits can also have the possibility of having up to $100 worth of overdrafts backed up completely free of charge. Read Current review: Revert to top Upgrade Personal loan company Upgrade was founded in 2017, launched a free checking account in 2021 that offers cash-back rewards that are more generous than Current’s. The primary benefits of Upgrade’s customers with a checking account are cash-back of 2% for everyday purchases, like at drugstores and restaurants and the possibility of 20% discount on the company’s personal loans. Customers can also view their credit scores no cost and a summary of their credit report through their Credit Health service. Read Upgrade reviews: Bella Bella’s bank approach is, as it says, “built on love.” This translates into the rewards program for checking accounts which offers a variable percentage of cash back, in the range of 5% to 200 percent, on selected purchases. Launched in 2020, Bella does not charge monthly ATM, overdraft, or ATM charges. In the moment, Bella also covers fees that are charged by non-network ATM operators. Additionally, they offer a fee-free savings account, but it offers low interest rates and an optional “karma account,” which can be used to pay for the small purchases of other customers or to be a recipient of another’s karma account generosity. >> See this list for the Back to top Cheese Started in March 2021, Cheese customizes its online banking platform to the immigrants as well as Asian American communities with up 10% cashback for 10,000 businesses, which includes Asian-owned restaurants and businesses. Support is provided in English as well as Chinese and will be available in more languages soon. Accounts earn interest and don’t have monthly fees or ATM charges in the national MoneyPass ATM network. Learn more on Back to top Investor-friendly Acorns The microinvesting app Acorns main product is automated investing for those who prefer not to be hands-on, it expanded into banking in the year 2018 with Acorns Checking. The account includes the debit card as well as a limited rewards program and is available in a bundle that includes a taxable investment account and individual retirement accounts, all for $3 per month (or five dollars for the family version). Customers can choose to participate in the “round-up” option where every purchase is rounded to an amount, and the amount is invested. The rewards program involves receiving some percentage or amount back from purchases at over 300 companies, and that can also be invested. Read Acorns review: Back to the top Aspiration Aspiration can be described as an online broker company with an account for cash management, named Spend & Save, that works like the hybrid savings and checking account. There are two different versions of this account. The standard Spend & Save account has the possibility of 3.00 percent interest on savings, and up to 5% cash back and a monthly charge that can be negotiated — customers pay what they believe is fair from the point of zero up to. The higher-end Aspiration Plus plan comes with an annual cost of just over $72 and with up to 10 percent cash back and up to 5.00% annual percentage yield. There are two accounts available too, meaning you can invest in businesses that are sustainable businesses and social causes. As an accredited B Corp company, Aspiration is committed to being an environmentally and socially conscious company and provides customers with customized sustainability scores based on which businesses they make their purchases at. Check out the Aspiration review: Aspiration Spend and Save accounts are cash-management account that are available by Aspiration Financial, LLC, a registered broker-dealer, Member of FINRA/SIPC. It is also a subsidiary of Aspiration Partners, Inc. (“Aspiration”). Aspiration Financial is not a bank.” Aspiration is not a bank. Aspiration Save Account’s up to 5.00% Annual Percentage Yield (“APY”) and up to 83x of the national interest rate is variable, subject to change, and only available to customers who are members of Aspiration Plus when the conditions are satisfied. Customers who aren’t enrolled in Aspiration Plus receive 3.00% APY after the conditions are fulfilled. Then they can go back to the top. Albert Albert started in 2016 as a financial management app and then launched a personal banking service named Albert Cash in August 2021. It currently has more than 6 million customers. Albert Cash is a banking account that pays cash back and includes the following advantages: no-interest cash advances up to $250, integrated budgeting and savings tools as well as annual savings bonuses up to 0.10 percent. To access Albert’s investing feature you can get the savings rate to 0.25 percent and avail its personalized customer support, called Genius There is an annual minimum fee of $4. It is required to have an external bank account to open an account with Albert. Return to top Traveler-friendly Revolut In its first year of operation, the United Kingdom-based Revolut offers attractive features for international travelers looking for affordable exchange rates and an account that allows spend in over 150 currencies. Customers can make international transfers with other Revolut customers, make withdrawals of up to $300 per month from ATMs at no cost and earn an interest rate on their savings. That’s all with the account for free. To get more benefits, such as overseas medical insurance, Revolut offers two accounts with monthly fees of $10 and $17. Read Revolut reviews: Back to top Wise The U.K.-based money transfer firm Wise, formerly known as TransferWise established an account with multicurrencies that was rolled across to U.S. customers in 2017. Although there’s an initial $9 fee for the debit card, Wise isn’t affianced of monthly charges and also converts currencies at an affordable exchange rate for a minimal initial fee. Converting a balance of $1,000 U.S. dollars to euros is, for instance, about $4.20, or 0.42 percent, which is cheaper than bank foreign transactions costs between 1% and three percent. The account can contain multiple balances, holding up to 54 currencies at a time and converting could be as quick as a matter of minutes. Read Wise review: Return to top of the list Freelancer-friendly Oxygen launched in the early part of 2020 the Oxygen digital banking account will help freelancers as well as self-employed people manage their money flow. Oxygen doesn’t have monthly or ACH or overdraft fees however, there are four pricing tiers for the account, which range from zero to $200 per year. All levels provide travel benefitslike lost luggage and hotel theft protection. higher levels come with more benefits that include greater savings rates, cash back, and a variety of virtual cards. A unique perk is the option to use the Oxygen application to incorporate or legally register as a company, and then . Check out the Oxygen review: Back to top Lili launched in the year 2019. Lili is a no-cost mobile bank account designed specifically with freelancers and independent contractors in mind. With Lili you can classify your expenses by simply swiping left for “life,” or personal or personal expenses, and then right for “work,” or business. Lili offers tools that aid freelancers in saving to pay taxes and also an emergency account. In addition, if you use Lili’s account to pay your earnings through online platforms and payment apps You can get your funds for up to 2 days earlier. This feature is standard among many neobanks. Check out Lili review The top Neobanks soon on your watch for the emergence of these four Neobanks in the near future: Daylight: Formerly called Be Money, Daylight plans to create a mobile bank account focusing on the LGBT+ community with features such as access to financial advisors and accounts that are based on a person’s chosen nameinstead of their legal name. Greenwood: The Black-owned digital banking company currently has around half million clients on its waitlist for savings and spending accounts which focus on reinvesting money in Black as well as Latinx communities. (See the list below of forthcoming and ongoing .) First Boulevard is a Black-owned banking 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 generations of wealth to Black Americans. Purple: Purple plans to provide mobile banking specifically for those with disabilities. It will include an account for checking and an account that is tax-advantaged, a savings account known as ABLE accounts. These accounts allow disabled people save money without the loss of any government benefits. Also, there will be an account that can be used to donate some of the money earned by Purple for the Special Olympics. Return to top From credit monitoring tools to travel perks Modern checking accounts provide more features than their predecessors did. Before you sign up, make sure to check whether the fintech business is a bank or partners with a bank. You can also see which features would most benefit your financial needs. About the author: Spencer Tierney is an expert in the field of certificates of deposit on NerdWallet. The work of Spencer Tierney has been featured on USA Today and the Los Angeles Times. On a similar note… Get an alternative savings account NerdWallet’s picks for the best high yield savings accounts online. Dive even deeper in Banking Find more money-saving strategies delivered straight to your inbox. Sign up and we’ll send you Nerdy articles on the topics in finance that are important to you along with other ways to help you make more from your money.
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