Online bank accounts for free can be a good fit for people that prefer digital banking and who don’t need to visit a physical bank branch.
Digital banking offers customer-friendly access to finance and money management tools and is probably why 82 percent of Millennials, ages 18 to 24, use mobile-only banking according to a PWC Survey.
People tend to like free online bank accounts not only for no-fee checking accounts but also for higher savings rates than traditional brick-and-mortar banks.
The money saved by not having to operate branch locations is passed onto the customer which means banks can offer online free checking along with savings accounts.
Our Favorite Online Bank Accounts For Free
SoFi Bank – Welcome Bonus up to $325
The Checking Account at SoFi offers no overdraft and no monthly fees. Plus, account holders have access to 55,000+ fee-free ATMs within the Allpoint® Network. Members with direct deposit can earn 1.25% APY with direct deposit and 0.70% APY without direct deposit. Plus, pay with your SoFi debit card to get up to 15% cash back at local establishments.
$25 Welcome Bonus. Earn a $25 Welcome Bonus when you open your account with at least $10 from an existing Visa or Mastercard Debit Card.
Additional Bonus up to $300. Earn an additional bonus up to $300 for setting up a qualifying direct deposit from an employer, payroll, retirement pension, or benefits provider like state unemployment via ACH deposit.
Here’s how to earn the additional bonus (A member may only qualify for one bonus tier):
- To earn the $50 bonus tier you must set up a qualifying direct deposit of $1000 – $1,999
- To earn the $100 bonus tier you must set up a qualifying direct deposit of $ 2,000 – $4,999
- To earn the $300 bonus tier you must set up a qualifying direct deposit of $5,000 or more
SoFi Checking Account Features
- No monthly maintenance fee.
- Minimum opening deposit of $10.
- Earn 1.25% APY on all your cash with a monthly direct deposit. Without direct deposit, you will earn 0.70% APY.
- 55,000+ fee-free ATMs.
- Get paid up to 2 days early with direct deposit.
- No-fee Overdraft Coverage with qualifying monthly direct deposit.
- Deposit checks, get real-time alerts, freeze or unfreeze your card, change your pin, and more—all from your phone.
- FDIC insured.
Upgrade Banking – Unlimited Cash Back on Debit Charges
The Upgrade Rewards Checking Account offers up to 2% cash back on common everyday expenses.
How to earn 2% cash back
- Convenience, grocery, and drug stores – Merchant examples: CVS, Walgreens, Rite Aid.
- Gas stations – Merchant examples: Shell, Chevron, ExxonMobile, Speedway.
- Monthly subscriptions – Merchant examples: Netflix, SiriusXM, Spotify, DisneyPlus.
- Restaurants – Merchant examples: McDonalds, UberEats, Chipotle, Starbucks.
- Utilities, phone – Merchant examples: AT&T, Tmobile, VerizonWireless, Cricket Wireless.
Unlimited 1% cash back on all other debit card charges
More Upgrade Rewards Checking Features
- No ATM fee.
- Zero Monthly Fees.
- Zero Overdraft/Insufficient Fees.
- 2% cash back on common everyday expenses and recurring payments and unlimited 1% cash back on every other debit card charge.
- Use your Rewards Checking card wherever Visa® is accepted.
- FDIC-insured up to $250,000.
Rewards Checking is offered by Upgrade Inc, a nonbank financial services provider founded in 2016 and based in San Francisco, CA. It is made possible by a bank partnership with Cross River Bank, Member FDIC. Upgrade VISA ® Debit Cards issued by Cross River Bank, Member FDIC, pursuant to a license from Visa U.S.A. Inc. Rewards Checking is available in 50 states (and Washington, DC).
Axos Rewards Checking – $150 Welcome Bonus
With the Axos Rewards Checking account, you can earn up to 1.25% APY* while enjoying a suite of digital tools for smarter money management. You don’t have to worry about overdraft or non-sufficient fees with this account plus get mobile banking and nationwide ATM access with no maintenance fees.
To earn the welcome bonus you must have qualifying direct deposit(s) that total at least $1,500 and use promotional code “MAY150″ when applying. You’ll find more financial products in the Axos Bank review that you may find beneficial to growing your finances.
Axos Rewards Checking Account Features
- Up to 1.25% APY
- Zero monthly maintenance fees
- Zero overdraft or NSF fees
- Zero minimum monthly balance
- Unlimited domestic ATM fee reimbursements
- Online debit card management
- Zero Minimum Balance Requirement
- Only $50 to open an account
CIT Bank – eChecking Account
The CIT e-Checking Account lets you earn interest with no monthly fees. Earn 0.25% APY with $25,000 minimum balance or 0.10% APY on balances under $25,000. Minimum of $100 to open your account. You can transfer funds with electronic transfer, mail-in check, or wire.
e-Checking Account Features
- CIT Bank does not charge ATM fees.
- Get up to $30 in other bank’s ATM fees reimbursed per month.
- Transfer, pay and purchase via mobile with Zelle®, Bill Pay, Samsung Pay and Apple Pay.
- Deposit checks and make unlimited withdrawal and disbursements with the CIT Bank mobile app.
- 24/7 account access online and mobile, plus an automated telephone system.
Current – Banking for modern life
Current Account does not use ChexSytems or a credit report to open accounts. One unique feature Current offers are no-holds on debit card gas purchases. Some gas stations may apply a hold of up to $100 when you use a debit card. These holds lock the amount being held, making it unavailable for spending. The Current debit card will immediately refund the hold so that you don’t have available funds locked for days.
Current Account Features
- $10 minimum opening deposit.
- Savings feature that pays 4.00% APY on balances up to $6,000.
- No overdraft fees when you overdraw by up to $200 with Overdrive™.
- Get your paycheck up to 2 days early with direct deposit.
- Earn points for unlimited cashback at participating retailers.
- Gas station holds immediately credited to your account.
- Send money instantly for free.
- 24/7 member support.
The Sable account is a no credit check, no fee account that earns unlimited 1% cash back on everyday purchases. Get a debit card in your digital wallet and start using it instantly.
Sable Account Features
- Open your account with as little as $25.00
- Get a dollar-for-dollar match on all cash back at the end of your first year with Sable’s Double Cash Bonus.
- Earn 1% cash back on everyday purchases at Amazon, Uber, Uber Eats, Whole Foods, Netflix, Spotify, and more!
- No credit check or US credit history required and no SSN required for non US citizens.
- Open a restricted account before you step foot in the U.S or have a U.S address.
- Zero hidden fees—no annual fees, no additional ATM fees, no overdraft fees, no card replacement fees, and no minimum deposit.
- Premium benefits like extended warranty where Sable will double the warranty for eligible items purchased with your Sable card, and satisfaction guarantee where Sable will cover most purchases if you become dissatisfied with a new product within 60 days of purchase, and much more!
Why Banks Charge a Monthly Service Fee
Despite free checking being wildly popular, the reason most banks charge a monthly fee is simple ⏤ Banks are for-profit businesses with the goal of making money. Monthly services fees at major banks can range from $5 to $25.
But to be fair, profit is not the sole reason for monthly services fees.
It may seem problematic that you may have to pay in order to use your own money, but banks need to cover operating expenses such as personnel costs and utilities.
Online-only banks don’t have to worry about costs associated with running local bank branches, but there are still operating costs involved.
Banks may offer customers ways to avoid monthly services fees like:
- Combining a checking and savings account like at CIT Bank where not only free checking is offered but a Combo Checking/Savings earns customers 0.50% APY.
- Maintaining a minimum balance in your account.
- Setting up a monthly direct deposit to waive the monthly fee.
- Discount on a monthly service fee to switch to online statements instead of getting monthly paper statements.
- If you have other qualifying products, services, or accounts from the same bank, such as a home mortgage, personal loan, or even a credit card.
Free checking can save you money
The money that you save on not paying a monthly service fee can add up to a nice chunk of change. Take a look at the monthly service fee at five major banks.
|Checking Account Fees at 5 Major Banks||Monthly Fee|
|Chase Total Checking®||$12|
|Citibank Basic Banking Account||$12|
|Bank of America Advantage Plus||$12|
|Wells Fargo Everyday Checking||$10|
|U.S. Bank Easy Checking||$8.95|
Once you’ve opened a free checking account, it’s important to manage it in the best way possible by avoiding unnecessary costs like overdraft fees. This ensures you’re getting the most out of what free checking has to offer. Overdraft fees can knock out a checking account balance unless you have some type of overdraft protection or a feature like Current Banking that will cover overdrafts up to $200 free of charge as long as you have direct deposit set up.