Questions you need to ask before opening an online checking bank account
Do you find it tedious and tiresome to visit a bank branch to access your checking or savings account? Most of the citizens across the country prefer accessing their bank accounts from the comfort of their homes. Online checking and savings bank accounts facilitate this very requirement of the customers and offer transaction facilities in just a few clicks. At the same time, there are some factors you need to consider before opening a checking account online The following queries and their answers will help you choose the best bank account that you can access hassle-free.
How to select the best online checking bank account?
Following factors will help you choose the best online checking or savings bank account:
- Interest and rewards– It is ideal to look for banks that offer some of the highest interest rates and rewards against every transaction. This is because online banks don’t have to pay to operate physical branch locations.
- Potential fees– The best online bank accounts will incur minimum or no fees for operating an account, overdraft fees, and ATM or other wire transfer fees.
- FDIC insurance– Select only those online banks that insured by the Federal Deposit Insurance Corporation(FDIC). This insurance helps in keeping your money safe in case the financial institution goes bankrupt.
- Easy deposits– Many banks offer a plethora of features for wire transfers and attract customers with minimum transaction fees. While you are choosing an online bank account, make sure that you look for those banks that offer you easy deposits. Many of these banks will have an app that will help you deposit checks without having to visit the branch physically.
Which are the best online checking bank accounts of 2018?
Following are the banks you should consider to open a new online checking bank account:
- Ally Bank– This bank offers competitive interest rates and a great mobile and online experience. It is one of the best online banks for an easy online transfer option. The bank also offers ATM fee rebates of up to $10 per month, if you are using ATMs that are out of the bank’s network.
- Discover Bank– Best known for its credit cards, this bank offers cash back on every online purchase and debit card swipe. Customers also earn 1% cash back on standard purchases of $3000 per month. This leads to $360 worth of rewards per year.
- Capital One 360– Deemed as one of the best banks to open an online checking account, it does not levy monthly recurring charges on your account. It also does not incur maintenance fees allowing you to open a bank with no or minimum balance. The bank has 39000 fee-free ATMs across the country.
What are the challenges of opening checking accounts online?
Some common reasons that might require the users to visit the nearest branch and provide additional documentation include:
- Age– Users under the age of 18 cannot open an online checking account on their own. Although there are provisions, if you are under 18, you might need an adult (preferably your parent) to accompany you to the nearest branch to open an account.
- Credit issues– Every bank verifies their user’s credit history before facilitating them with an account. If you are young, it is most probable that you might not have borrowed money. Hence, you will not a credit history. As a result, you will have to visit the nearest branch with a government-issued proof of identity to open an account.
- Citizenship- Permanent residents would be required to visit the bank and verify all the documents personally, as permanent residents have a documented process for their identification. This factor does not hold true if you are a citizen of this country.
- Entity accounts– If you have opened a checking bank account online and are planning to open a new checking account online for a business, trust, etc. you might require heading to the nearest branch.
What are the drawbacks of opening checking account online?
Opening an online checking account comes with its set of drawbacks. Some of them are mentioned below:
- Security issues– Sometimes you might find it uncomfortable to trust a bank’s online services if large sums of money are involved. Risks such as identity theft or server breach can give someone unauthorized access to your account, jeopardizing it.
- Technology constraints– As ironic as it may seem, banks offering online services for their checking and savings accounts might face technical issues in case of downtime or bandwidth limitation. This can be very frustrating if you want to access your account from your home for an urgent transaction
- Depositing money is inconvenient– It becomes counterintuitive for a bank if they make it hard for their customers to deposit money in their account, as their purpose is to attract more assets. Although many banks provide an app for check deposit, others require you to visit the nearest branch personally to do the same.