19 Neobanks and the Benefits They Provide Advertiser disclosure You’re our first priority. Every every time. We believe that everyone should be able to make financial decisions with confidence. And while our site doesn’t feature every company or financial product available on the market however, we’re confident of the advice we offer as well as the advice we offer as well as the tools we design are objective, independent easy to use and cost-free. How do we earn money? Our partners pay us. This could influence the types of products we review and write about (and the way they appear on our website), but it doesn’t affect our advice or suggestions that are based on thousands of hours of study. Our partners cannot be paid to ensure positive review of their services or products. . 19 Neobanks and the Benefits They Provide Neobanks distinguish themselves by focusing on certain communities, and offering a variety of benefits and more. Written by Spencer Tierney Senior Writer | Certificates of Deposit and ethical banking, as well as banking deposit accounts Spencer Tierney is a consumer banker at NerdWallet. He has been writing about personal finance since 2013, with a particular focus on certificates of deposit, as well as other banking subjects. He has had his work featured on The Washington Post, USA Today, The Associated Press and the Los Angeles Times, among other publications. He is based within Berkeley, California. Sep 23rd, 2021 Edited by Yuliya Goldshteyn, Assistant Assigning Editor Banking Yuliya Goldshteyn is a bank editor with NerdWallet. She has previously worked as an editor, writer , and research analyst in industries ranging from health care as well as market research. She graduated with a bachelor’s degree in history from Berkeley at the University of California, Berkeley as well as a master’s degree in social sciences from the University of Chicago. She can be reached by email at
. The majority of items featured here come from our partners, who pay us. This affects the products we feature and the location and manner in which the product appears on a page. However, this does not affect our assessments. Our opinions are entirely our own. Here is a list of and . The information on investing provided on this page is for informational purposes only. NerdWallet is not a broker or advisor. or brokerage services or advice or advise investors to buy or sell particular securities, stocks or other investment options. You can jump to a specific Neobank or category for high-yielding savings: For widest variety of accounts: inexpensive overdrafts for | | Investor-friendly: Neobanks are financial technology — also known as fintech firms that usually offer mobile-oriented banking accounts with eye-catching features such as low-cost cash-back rewards or credit. Some established neobanks offer loans and credit cards, as well as investing productsas well. They generally operate without branches and, as a majority of neobanks lack banking licenses, partner with banks in order to secure security against the Federal Deposit Insurance Corp., among other things. The majority of the neobanks in this list are insured by FDIC. Saves Cash Management CD Checking Money Market Member FDIC SoFi Savings and Checking APY 3.75% SoFi members with direct deposit have the opportunity to earn up to 3.75 percent per year in annual percentage return (APY) in savings account balances (including vaults) and 2.50 percent APY on checking balances. No minimum direct deposit amount needed to be eligible for 3.75 percent APY on savings, and 2.50% APY for checking balances. Customers who do not deposit direct deposits will earn 1.20% interest on balances of savings and checking (including Vaults). Interest rates are variable and can change at any time. The rates listed 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 Goldman Sachs Online Savings Account APY 3.50% 3.50% APY (annual percentage yield) with a balance of zero to earn the stated APY. Accounts must be in positive balance in order to be open. APY valid as of 02/07/2023. Min. balance for APY Cash accounts are $0 and offer a variety of services and features comparable to checking, savings and/or investment accounts in one product. The cash management account is generally offered by non-bank financial establishments. They combine the services and features that are similar to savings, checking and investment accounts in one account. These accounts for managing cash are generally offered by non-bank financial institutions. on Wealthfront’s website Wealthfront Cash Account APY 4.05 percent min. amount of APY $1 on Betterment’s website Betterment Cash Reserve, Paid Non-Client Promotion APY 4.00% Annual percent return (variable) is as of 02/06/2023. Min. balance for APY $0 CDs (certificates of deposits) are a kind of savings account with fixed rates and terms generally, they come with higher rates of interest than standard savings accounts. CDs (certificates of deposit) are a kind of savings account that comes with a fixed rate and term, and usually have higher rates of interest than traditional savings accounts. CIT Bank CD APY 4.60% 1.5 years Term 1.5 Years Member FDIC Marcus by Goldman Sachs High-Yield CD APY 4.40 percent 4.40% APY (annual percentage yield) at 01/25/2023. Term 1 year Checking accounts are utilized to deposit cash on a daily basis and for withdrawals. Checking accounts are utilized to make cash deposits on a regular basis as well as withdrawals. Member FDIC SoFi Savings and Checking APY 2.50% SoFi members with direct deposit can earn up to 3.75 percent per year in annual percentage returns (APY) for savings accounts (including Vaults) and 2.50 percent APY on their checking balances. No minimum amount for direct deposits needed to earn the 3.75% APY on savings, or the 2.50 percent APY on checking balances. Direct deposit members will get 1.20% APR on all balances in checking and savings (including Vaults). The rates of interest are subject to fluctuation and are can change at any time. These rates are current at the time of 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 the Axos Visa(r) Debit Card for a total 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 in the Axos Managed Portfolios Invest Account in order to receive 0.20 percent annual percentage yield. Maintain a daily average balance of $2,500 per month in An Axos Self-Directed Trading Invest Account to earn 0.20 percent APY. Use Your Rewards Checking Account for the full each month Axos customer loan payment to earn 0.15 percent APY. Monthly fee $0 Money market accounts pay rates that are similar to savings accounts and include certain checking features. Money market accounts have rates similar to savings accounts and have certain features for checking. Members FDIC UFB’s best Money Market Rate APY 4.21% Min. balance for APY $0 Member FDIC Discover Bank Money Market Account APY 3.20 0.20 % Min. amount for APY $1. Learn more: The amount of fintech firms that can be referred to as neobanks is growing. From 2018 to 2020 Neobanks have exploded from 60 to 256 around the world according to a study by the business strategy firm Exton Consulting. With increased competition comes greater competition. Some once-innovative services are now becoming common among neobanks, such as two-day early access to direct deposit as well as free access to national ATM networks. Digital wallets, such as and, are competing with neobanks by offering some of these features. Neobanks are looking for ways to differentiate themselves by appealing to certain categories, such as freelancers or tourists from other countries, as well as by offering perks you might not find at traditional banks. Here’s a look at the ways that some of the upcoming and current Neobanks attempt to distinguish themselves. >> Learn more for high-yield savings Chime was founded in 2013. Chime is one of the biggest neobanks with over 12 million customers. It is partnered with two banks, it offers savings and checking accounts that are both free of charges for monthly usage, as well as a secured credit card you can utilize to build credit. Chime’s savings account has an interest rate that is competitive at 2.00 percent annual percentage yield** with no minimum balancerequirement, no maximum amount for earning interest, and no monthly costs. (The Chime Savings Account must be opened to create a savings account, while the Savings Account is an option.) The spending account offers free access to more than 60,000 ATMs*** throughout the nation and, for customers who make direct deposits, there is a no-cost overdraft program that covers the amount of $200. Cash deposits are offered at big retailers ****, and is not a feature that all neobanks provide. The process of signing up can be easier than at traditional banks as there’s no verification of credit or previous banking records however, Chime offers an . See more information from Chime *Chime states: “Chime is a financial technology company, not a bank. Services for banking are provided by The Bancorp Bank, N.A. and Stride Bank, N.A. Member FDIC.” “**” **”The annual Percentage Yield (“APY”) for the Chime Savings Account is variable and may alter at any moment. The APY disclosed is in effect on October 25, 2022. No minimum balance required. Must be in possession of $0.01 of savings in order to receive interest. ” ***”Out-of-network ATM withdrawal fees are applicable, except for MoneyPass ATMs located in 7-Eleven or an Allpoint as well as Visa Plus Alliance ATM.” ****”The retailer who takes your cash is accountable for the transfer of the cash to deposit into your Chime Account. Account. Cash deposit fees may apply if using a retailer other from Walgreens.” Check out Chime reviews: Back to Top Varo Bank Varo Bank offers savings, checking and cash advances. Established in 2015, and initially operating with bank partnerships, it was made an officially chartered bank in the month of August, 2020, which allowed it to provide their very own FDIC insurance. According to Varo, it had 6 million customers as of the middle of 2022. The checking account has no cost ATM access, and there are no monthly fees, in addition to benefits like cash-back at certain stores with no transaction charges. The savings account is subject to two requirements to earn an interest rate of 5.00% APY on the first $5,000 of savings, which includes a $1,000 minimum in monthly direct deposits and keeping a positive savings and checking balance at the end of each month. In other cases, the rate is 3.00% APR. Read Varo review: Back to top For the most extensive variety of options SoFi SoFi is short in the sense of “Social Finance” began as an student loan refinance firm, but it has since obtained an own charter for a bank. The SoFi Savings and Checking account is a combination account that can handle the money to spend and save. There are no charges for accounts for overdrafts, ATM usage, or monthly maintenance (subject to changing at any time). There are perks like earning interest, creating subaccounts to save as well as those who make the right direct deposit, free overdraft coverage that can be up to $50. SoFi also offers a range of loans including automatic and active investing as well as cryptocurrency trading credit cards, as well as retirement accounts. Check out SoFi reviews: to top One Owned by Walmart, One’s banking account has a cheap overdraft program, custom-designed budgeting and savings options. It offers customers the ability to arrange their funds into pocket-sized accounts, also known as subaccounts. Pockets that are devoted to saving have rates of 1.1% of up to $5,500 for every customer and 1% on up to $25,000 for customers with direct deposit. One offers free overdraft protection up to $200 for customers with direct deposits of at least $500 monthly. It’s less expensive than the big banks with overdraft charges that can range from $33 per transactions. Read reviews on One:Previous pageFind out more about the credit-building GO2bank (and GoBank) Green Dot Corporation has offered alternative banking products since 1999. From prepaid debit cards It expanded to the first online bank in GoBank which was launched in 2013, and its second bank brand, GO2bank, in 2021. Every one of the Green Dot deposit accounts are federally insured by Green Dot Bank. Contrary to many neobanks which require online signup, you can pick up GoBank and GO2bank debit cards at retailers like Walmart and then activate them online to use with the mobile application. Between the two brands, GO2bank is the best alternative, as it has a lower monthly cost and more benefits however not as numerous as other neobanks such as Chime and Varo. GoBank’s monthly fee of $9 is waived by $500 direct deposits, while GO2bank’s $5 monthly fee is waived when you deposit direct without a minimum. Alongside the bank account, GO2bank provides a secured credit card to build credit and has an account for savings that earns 1% APY for as much as $5,000. However, GoBank doesn’t offer a credit card, and its savings vault doesn’t earn interest. Read GoBank review: Read more about GO2bank: Return to top Sesame Cash The credit firm Credit Sesame launched a free digital bank account in March 2020 . The account concentrates on helping those who live pay-to-pay. The account’s features include access to direct-deposited paychecks up to two days in advance, cash and mobile check deposits and a limited cash-back on debit cards, and free access to a national ATM network. Through the account, users have access to Credit Sesame’s free credit monitoring and daily updates to credit scores. >> Compare the top to the back MoCaFi MoCaFi, or Mobility Capital Finance is Black-owned digital platform launched in the year 2016 that offers free checking to serve largely unbanked and underbanked communities with a primary focus on closing the gap in wealth between the races. It provides a bill pay feature that allows users to submit rent payments to the major credit bureaus in order to establish credit histories. As a rare perk, MoCaFi collaborates with third-party partners to give cash-free deposits at a variety of stores and mobile check deposits with fast withdrawal of funds. Return to top Dave Dave started in 2017 as a company that offered a pay advance and later expanded to provide an all-inclusive checking account. By mid-2021, it had about 1 million clients. You can get a small cash advance from your next salary without interest or a credit check. Customers who have at least $1,000 in direct deposit each month are able to build credit history by making rent payments. Dave also provides budgeting that factors in upcoming bills and the option to search for jobs that are not listed in its mobile app. There are no charges for overdrafts , or using ATMs that are part of the nationwide MoneyPass network and no minimum amount of balance required. Read the Dave review Return to top reward cash back Current Current, founded in 2015, provides free and premium options for checking with cash back on certain merchants, two-day direct deposit, and fast refunds on gas station debit hold on cards. The latter two perks are only available for premium accounts, which charge an annual fee of $5. Premium accounts with direct deposit can also have the possibility of having up to $100 worth of overdrafts backed up at no cost. Check out the Current review: Back to top Upgrade A personal loan company Upgrade was founded in 2017, introduced 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 customers who have a checking account include cash-back of 2% on purchases made every day, such as in the restaurants and pharmacies as well as up to 20% rate discounts on the company’s personal loans. Customers can also see their credit scores for no cost and a summary of their credit report through their Credit Health service. Return to top of the page Bella Bella’s approach to banking is, as it says, “built on love.” It’s a checking account rewards program which offers a variable amount of cash back, anywhere from 5% to 200 percent, on selected purchases. It was launched in 2020. Bella does not charge monthly, overdraft or ATM fees. Currently, Bella also covers fees for out-of-network ATM operators. There is also a no-fee savings account, which has minimal interest rates, and an additional “karma account,” which can be used to pay for the small purchases of other customers or as a beneficiary of a karma account’s generosity. Check out our complete list below of Back to top Cheese Started in March 2021. Cheese is able to tailor its digital banking platform for the immigrant as well as Asian American communities, offering up to 10% cash back on 10,000 businesses, including Asian-owned restaurants and businesses. Customer support is available in English and Chinese as well as other languages soon. Accounts earn interest and don’t have monthly charges or ATM fees for the nationwide MoneyPass ATM network. Learn the details about Back to top Investor-friendly Acorns While the microinvesting app Acorns principal product is an automated investment for investors who don’t have hands, it expanded into banking in the year 2018 with Acorns Checking. The account includes a debit card and limited rewards program, and is available only as a package 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 version). Customers can choose to participate in a “round-up” feature in which each purchase is rounded up by an amount, and the change is then invested. The rewards program involves receiving a small 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 is an online brokerage company that has an account for cash management, named Spend & Save, that works like an hybrid savings and checking account. There are two types that the accounts are available. The standard Spend & Save account has up to 3.00% APR on savings, up to 5% cashback and a monthly fee that is optional which customers pay as they consider fair starting at the point of zero up to. The higher-end Aspiration Plus plan has an annual cost of just over $72 and with up to 10 percent cashback and up to 5.00% APR. There are two accounts available as well, which means you can invest in businesses that are sustainable business practices and social causes. As an official B Corp company, Aspiration is committed to being an environmentally responsible and socially conscious firm and offers customers personalized sustainability scores depending on the companies they spend money at. Read Aspiration review: The Aspiration Spend & Save Accounts are cash management account that are available by Aspiration Financial, LLC, a registered broker-dealer, Member of FINRA/SIPC. It is also an affiliate of Aspiration Partners, Inc. (“Aspiration”). Aspiration is not a financial institution.” Its Aspiration Save Account’s up to 5.00% annual percentage yield (“APY”) and up to 83x the average national interest rate is variableand subject to change, and only accessible to customers who are who are enrolled in Aspiration Plus when conditions are satisfied. Customers not enrolled in Aspiration Plus receive 3.00% APY after the conditions are met. Back to top Albert Albert started in 2016 as a money management app and launched a personalized banking service known as Albert Cash in August 2021. The company has more than six million customers. Albert Cash is a banking account that offers cash-back and offers the following advantages including cash advances with no interest up to $250, integrated budgeting and savings tools, and annual savings bonuses of up to 0.10 percent. To access Albert’s investing feature, get the savings rate to 0.25 percent and avail the personalized support for customers known as Genius and there is a minimum monthly fee of $4. You need to have an external bank account to open an account with Albert. Back to top Traveler-friendly Revolut was launched in the year 2015 The United Kingdom-based Revolut provides attractive features to travellers from abroad who are looking for affordable exchange rates and the ability to use more than 150 currencies. Customers can transfer funds abroad with other Revolut users, and withdraw up to $300 monthly from ATMs at no cost and earn an interest rate on their savings. This is all included in the account that is free. For additional benefits, like overseas medical insurance, Revolut offers two accounts with monthly charges of $10 and $17. Read Revolut reviews: Back to top Wise Review: U.K.-based money transfer firm Wise, formerly known as TransferWise, created a multicurrency account that rolled across to U.S. customers in 2017. There’s an initial $9 fee on the credit card Wise does not charge monthly charges for account usage and can convert currencies at an affordable exchange rate with a small upfront cost. The conversion of a balance of $1000 U.S. dollars to euros as an example, will cost around $4.20 which is 0.42% that’s less expensive than many bank foreign transactions fees that range from 1% to 3percent. An account can have multiple balances and hold up to 54 currencies simultaneously and the conversion process could take just a few seconds. Read Wise review: Back to top of the list Freelancer-friendly Oxygen launched in the early part of 2020, Oxygen’s digital banking account will help freelancers as well as self-employed people manage their money flow. Oxygen doesn’t cost monthly fees, ACH as well as overdraft costs There are however four pricing tiers for the account, ranging from free to $200 annually. Each level offers advantages for travel, including loss of luggage and hotel theft protection. higher levels have more perks that include higher savings rates, cash back and more virtual cards. One unusual perk is the possibility to use the Oxygen app to incorporate, or legally establish a business, and after that . Check out the Oxygen review: Return to the top Lili It was launched in 2019. Lili is a mobile bank account that was designed for freelancers as well as independent contractors in mind. With Lili, you can categorize your expenses by simply tapping left for “life,” or personal or personal expenses, and then right for “work,” or business. Lili also includes tools that aid freelancers in saving for taxes, as well as an emergency savings account. In addition, if you use Lili’s account to transfer your earnings through websites and payment apps, you can receive the funds for up to 2 days prior. This is a common feature among many neobanks. Read Lili review The top Neobanks to come soon Keep an eye on these four new neobanks’ launches in the near future. Daylight: Previously known as Be Money, Daylight plans to create a mobile bank account specifically targeting members of the LGBT+ community with features like access to financial advisors and accounts that are based on a person’s chosen nameinstead of its legal title. Greenwood: A Black-owned digital banking company currently has around half million people on its waitlist for savings and credit cards which focus on reinvesting money in Black and Latinx communities. (See the list below of the upcoming and current .) First Boulevard The Black-owned bank platform is focused on low-cost banking that offers cash back to businesses owned by Blacks, as well as short financial education videos. Its goal is to build the wealth of generations that is accessible to Black Americans. Purple: Purple plans to provide mobile banking specifically for people with disabilities, including an account for checking and an account that is tax-advantaged, a savings account known as ABLE accounts. These accounts let people with disabilities save money, without the loss of any government assistance. Additionally, there will be an account that can be used to donate part of the profits towards the Special Olympics. Back to top From credit monitoring tools to travel benefits, modern checking accounts offer more than their predecessors offered. Before you sign up, make sure to check whether the fintech firm is a bank or partners with a bank. You can also see which features would best suit your needs in the financial realm. About the author: Spencer Tierney is an expert in the field of certificates of deposit at NerdWallet. Its work was featured in USA Today and the Los Angeles Times. On a similar note… Discover a better savings account See NerdWallet’s recommendations for the top high-yield savings accounts on the internet. Go deeper into Banking Make smarter money decisions right to your inbox. Sign up and we’ll email you Nerdy content on money-related topics that are important to you and other strategies to help you get more value from your savings.
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