How to Find the Best Online Checking Account [10 Factors to Consider]

Jan 30, 2023

Online checking accounts are fast and easy to set up. You can apply for one in the comfort of your own home, and start enjoying the convenience of a debit card and checks without much delay. Yet as you start looking for the best online checking account, you'll quickly discover that they have many different features. How can you choose the right one? Here are 10 features to look at that will help you find the best checking accounts.

1. FDIC/NCUA Insured Deposits

Make sure the bank carries insurance for your checking account deposits. Banks purchase insurance with the Federal Deposit Insurance Corp (FDIC) and credit unions purchase insurance through the National Credit Union Association (NCUA). You will find some non-insured online banks, so avoid these. The best online checking account for your needs will protect your deposits well.

2. Minimum Balance Requirements

Some checking accounts, especially those that offer interest on purchases, will require a minimum balance to be maintained to avoid fees. If you want the benefit of earning interest, then this isn't necessarily a bad feature, but make sure you know what the minimum is and are able to maintain it. Otherwise, the checking account could become expensive quite quickly.

3. Fees

Some checking accounts are free. Others charge fees. Sometimes the best online checking account for your needs won't be free, but you need to know what the fees are and why you pay them. You may need to pay fees for your account if you find yourself in need of a second chance checking account. If you don't want to pay any fees, look for a free checking account. These typically have no balance requirements but they also might not pay any interest. They simply hold your money until you need to use it. There are however some checking accounts without a monthly fee that also offer rewards like cash back, high dividends and ATM fee refunds. This is why it’s important to do your research.

4. APY

Some checking accounts pay interest. If you're considering a checking account with APY, make sure you read the details carefully. You may need to meet certain requirements or be willing to pay a fee to make use of the interest-earning feature on the account.

5. Mobile App with Remote Deposit Capture

Accessing your money on the go is always beneficial. A mobile app is a nice benefit to have with your online checking account. Not all apps are created equal, though. Many will allow you to deposit checks through the app using remote deposit capture, but many go beyond this as well. For instance, some will send alerts if you're close to an overdraft. An app full of features will help you make the most out of your online checking account.

6. Rewards

Online checking accounts are highly competitive. They want your business, and they're going to offer perks to woo you. Look for an account that offers fun rewards, like cash back on purchases or ATM fee refunds.


7. Usage Requirements

In addition to potential minimum balance requirements, some checking accounts have usage requirements or other restrictions. You may be required to limit the number of deposits or transactions each month, use your debit card for a specified number of purchases, etc. Make sure you know these requirements before signing up for the account.

8. Overdraft Protection

Everyone makes mistakes, and you don't want to be faced with stiff penalties and fines if you have a check that bounces. Overdraft privilege means the bank will cover the difference if you spend a little more than what's in your account. There is a fee for this, which averages to be $33.36 per transaction, but overdraft costs, also known as NSF fees, can vary amongst different institutions.

9. ATM Options

If you need cash quickly, you'll want access to an ATM. ATMs often charge a fee for this service. The best checking accounts offer no-fee ATM services or no fees for ATMs that are within their network. If you travel frequently, then you will want a checking account that allows you to use a large network of ATMs.

10. Automatic Deposits and Bill Pay Features

Do you want to have your paycheck deposited automatically? Make sure your bank is set up for this. Direct deposit allows your employer to send your paycheck right to your checking account. Most banks and credit unions offer this feature. However, you may also want automatic payment options. With these options, you can send payment directly to your billers through your checking account without having to think about it.

Finding the best checking accounts doesn't have to be hard. You need to know what to look for, but with this information in hand, you can find an account that fits your needs well. Take the time to research each of these 10 features, and soon you'll find the perfect account.

Have you ever had a checking account closed due to a financial mishap in the past? Check out our Second Chance Checking Account and other second chance products.

For more details on how the best online checking account to improve your credit may be a second chance checking, review our "Roadmap to Building Credit: Second Chance Checking and Specific Steps to Rebuilding Credit"