Best Digital Banking Apps

As the number of people who use the internet grows, more and more of them will appreciate the convenience of being able to do things like going to meetings or making purchases without leaving their homes. 

The majority of financial institutions now provide more convenient services. Just picture yourself making weekly visits to the bank to withdraw £300 just to get by. And you may expect to wait an hour or two each time you visit the bank. 

The advent of digital banking applications has meant that it is no longer necessary to physically visit a bank in order to conduct financial transactions — in this guide, we review the top digital banking apps on the UK market.

At a Glance, Pros and Cons

So, let’s take a quick look at the benefits and disadvantages of the UK’s best digital banking apps, first:

Pros

✅ You can log in from any computer or mobile device.

✅ Quickly complete your banking needs and be on your way.

✅ No need to queue up at the bank.

✅ Improved pricing structure.

✅ Constant availability.

✅ Fast and simple to use. 

✅ Avoid the hassle of visiting a bank or ATM.

Cons

❌ Concerns about safety.

❌ Potential technical problems.

❌ The convenience of having money on hand might lead to wasteful spending through ‘gamification’ habits.

Top Digital Banking Apps — Reviews

Where should we begin to define “digital banking” as a whole or “digital banking apps”?

Traditional banking is combined with online features to create digital banking. It's a bank, but you can do all your banking online or with your phone.

Years ago, conventional banks began to embrace the Internet, ushering in a new era of financial literacy. Internet access is essential for digital banking transactions such as opening an account, moving cash, setting up direct debits, making remote payments, sending remittances, and more.

App-based banks, a by-product of digital banking, provide convenient ways to manage your money and track your spending and savings in one convenient place.

There is a lot of room for manoeuvrability and control over one's finances in the realm of digital banking.

In order to take use of a digital banking app when and when it's most convenient for you, you'll need a fairly recent smartphone running iOS or Android. 

Below, we share some of our favourite banking apps 👇:

Comparison Table

1. Starling Bank — Best Overall Features

• Free account opening: Yes
• Spending notifications: Yes
• Round up feature: Yes
• ATM withdrawal fee: Free

Visit Starling Bank

Starling Bank is one of a new breed of “challenger banks” that are employing cutting-edge tools and techniques to bring banking into the 21st century and make it more accessible to the average person.

Starling is a personal banking service that is available only online and accepts both British pounds and Euros. They also provide a fantastic app that's packed with useful extras.

Extremely user-friendly, it enables you to manage all elements of a checking account, such as budgeting, spending, depositing checks electronically, and creating savings targets.

With the app's helpful spending alerts, you'll always know when your debit card has been used. The updates shed light on your spending patterns and encourage you to be more deliberate about your financial objectives. 

When it comes to international travel, Starling is hard to beat. Payments made using a foreign credit card are not assessed a fee, and neither are withdrawals from an ATM. In addition, you may get up to £300 every day in foreign currency withdrawals.

The 'round-up feature’ function automatically adds a pound to each purchase, which may add up to significant savings. The surplus is automatically deposited into a separate account earning 5% interest. Money management is simplified with the ability to add up to 20 more accounts and a monthly expenditure summary.

Pros

✔️ In the United Kingdom, opening a current account takes no more than 20 minutes — you can expect to get the card within the week.

✔️ The software lets you create joint and company accounts.

✔️ Interest rate of 0.05% AER on balances up to £85,000 on a personal current account.

✔️ The “settle up” function of Starling Bank makes it simple to divide group payments.

✔️ No hidden costs for international purchases or ATM withdrawals.

✔️ The “Marketplace” on Starling provides access to competitive pensions, mortgages, and insurance products from other rapidly expanding fintech businesses.

✔️ Overdraft (not everyone will be guaranteed an overdraft, the application is subject to a hard credit score search) charges are transparent and among the lowest in the industry.

✔️ The FCA and the PRA have issued full licences, keeping things safe and secure.

Cons

❌ The bank itself does not provide mortgages or other complicated financial services; although, the Starling Bank Marketplace does provide access to goods from other providers.

❌ There are no physical bank locations, but customers can make deposits and withdrawals at any Post Office. 

2. Monzo — Solid Option for Savings

• Free account opening: Yes
• Spending notifications: Yes
• Round up feature: Yes
• ATM withdrawal fee: Free

Visit Monzo

Monzo is similar to Starling in that it provides real-time alerts about your spending and detailed reports on your financial activity. Their savings account incentives and partnerships with other banks are well-known. 

The bright and entertaining mobile app makes managing your free account a breeze (so long as you can stand the programme's loud, judging sound after every purchase).

As a result of Monzo's collaborations with other financial institutions, savers may earn an annualised return (AER) of more than 3%. For this reason, we recommend Monzo as a long-term savings account.

It's also serviceable for usage abroad, albeit not ideal, especially for making significant cash withdrawals. If you withdraw more than £200 from an ATM abroad in a single month, you will be charged a cost of £4.

For amounts more than that, a 3% surcharge will be added. However, up to £250 every 30 days is still free of charge in the UK, EU, Iceland, Liechtenstein, and Norway.

Pros

✔️ You can apply in minutes using the app, and your residence or credit history won't matter until you want an overdraft.

✔️ Open a savings account with one of Monzo's supported banks.

✔️ Do everything through the app.

✔️ Spending budgets and analytics with updates and alerts. 

✔️ You can add funds to your PayPoint account at any retailer that displays the logo.

Cons

❌ Customers who want in-person assistance may be disappointed by the absence of physical bank locations.

❌ Withdrawals exceeding £250 are subject to a 3% fee from ATMs.

❌ You can only make one free international withdrawal of £200 per 30 days.

❌ You can only get it in the US or UK.

❌ It is not possible to add funds using a debit or credit card.

3. Lloyds Bank — Free Everyday Online Banking

• Free account opening: Yes
• Spending notifications: Yes
• Round up feature: Yes
• ATM withdrawal fee:  Free up to £500

Visit Lloyds Bank

Lloyds does not compete only with challenger banks in the mobile banking app market.

Instead, they are working on adapting the standard banking experience for use with mobile devices. They've done an outstanding job, indeed.

The Lloyds app is a model of minimalism. You may do things like see your account history and balance, make adjustments to your profile, or even put a temporary hold on your card. On the other hand, it offers some rather neat features (for a traditional bank).

For instance, there are regular promotions that provide you access to perks like cash-back bonuses. They also provide the option to save the spare change from purchases by depositing it into a separate savings account.

You may see and stop future automatic payments using their app's built-in upcoming payments function. Useful if you have trouble keeping track of the many memberships you've signed up for.

Mortgages, loans, credit cards, and pretty much everything else you may want in terms of financial services are all on the table. If you'd want to keep all your banking with a single financial organisation, Lloyds is a good option because of the variety of services they provide.

Pros

✔️  Lloyds has a lot of resources and products available.

✔️  Visit physical stores on the high street where you may talk to a customer service agent in person.

✔️  The app can handle the vast majority of your banking requirements.

✔️  Information and alerts sent instantly.

✔️ All of your account balances, across all of your banks, are available for viewing.

Cons

❌ The app does not allow account creation.

4. Monese — Good for Travellers

• Free account opening: Yes
• Spending notifications: Yes
• Round up feature: Yes
• ATM withdrawal fee: £100 free monthly

Visit Monese

More than two million people throughout most of Europe have checking accounts with Monese, another app-only challenger bank.

We recommend Monese to anybody moving to the UK from the European Economic Area (EEA) since, unlike many other banks, it doesn't need you to confirm your domicile to fulfil creditworthiness criteria in order to establish an account with multiple currencies.

There are three distinct subscription tiers available: the free “Simple” plan, the £5.95/month “Classic,” and the £14.95/month “Premium” plan.

In addition to its speedy account creation, Monese also shines with its insurance offerings, credit-building tools, and support for joint accounts. You'll also be provided with our GBP and EUR bank account information.

All Monese account holders have access to a credit builder tool, which may be used to establish a credit history and raise the user's credit score. It entails committing to a certain monthly payment inside the app (starting at £2.50).

The payments are reported to credit bureaus by Monese, which helps you establish a positive credit history. Account holders get their funds after 12 months. 

In addition, both the Classic and Premium accounts include free payment protection insurance as well as free accident, sickness, and unemployment (ASU) insurance cover (hospital payment benefit solely for self-employed employees), subject to specified payout limitations and other restrictions and conditions.

The high fees associated with making international purchases and using ATMs are Monese's Achilles' heel. Using the ‘Starter' plan from Monese, for instance, you'll pay £1.50 for each cash withdrawal, 2% for any foreign currency transactions outside of SEK, EUR, GBP, and RON, and an extra 1% on weekends.

Pros

✔️ Minimum documentation required. 

✔️ Sending money to more than 30 different countries.

✔️ Credit-building service available; pre-approval not necessary.

✔️ Virtual cards and joint accounts are supported in the UK.

✔️ Keep money in Euros and British Pounds.

Cons

❌ Overdraft, interest, and loans are not provided.

❌  Costs do not often decrease when a plan is upgraded.

❌  Withdrawals from a beginning account cost £1.50 plus 2% for any foreign currency transactions outside of SEK, EUR, GBP, and RON, plus 1% on weekends.

❌  Spending in currencies other than those mentioned above incur hefty costs.

❌  Additional fees for exchanging currencies over the weekends.

5. Chase — For Cashback Rewards

• Free account opening: Yes
• Spending notifications: Yes
• Round up feature: Yes
• ATM withdrawal fee: Free up to £500 a day

Visit Chase

Chase, a JP Morgan subsidiary, launched as a digital bank in the United Kingdom in 2021 and has since become one of the country's most popular banking applications. However, it must be stressed that Chase is a separate entity from JP Morgan. 

One of its most appealing features is a 1% cash rebate on everyday debit card spending for the first 12 months (new customer only).

You may get a competitive cashback rate on most purchases (up to £15 a month, cashback exceptions apply) with the Chase checking account, which is accessible only via the Chase mobile app. After the first year, a monthly payment of £500 or more is necessary to maintain the cashback bonus.

There are no costs associated with creating or maintaining this account. No foreign transaction fees will be assessed when you use your Chase card to make purchases or withdraw cash from ATMs in a foreign country. At long last, the Chase app allows you to set up and manage direct debits from your Chase account.

The 'round-up' function may be set up to automatically add 5% to your savings whenever your purchase total exceeds £1.

Pros

✔️ An entirely no-cost online checking account.

✔️ No foreign transaction or ATM withdrawal fees.

✔️ Interest rates on checking accounts of 1% per month.

✔️ Up to £15 monthly rewards on purchases made across several different categories at 1%.

✔️ Earn 4.1% AER (4.02% gross) variable interest, paid monthly on all connected Chase Savings Account balances.

✔️ In-app assistance available at any time.

✔️ Securely disable cards in the event they go missing.

✔️ Extra budgeting and savings options.

Cons

❌ A 12-month period of round-ups will only earn you 5% interest.

❌  The option of visiting a branch in person is unavailable.

❌  You are unable to fund your account with physical currency.

❌  Overdrafts are currently unavailable.

Britain’s Top Digital Banking Apps — Buying Guide

Let’s take a closer look at digital banking apps as a topic.

Why are people turning to mobile banking apps?

Of all people in the UK, 64% have used a mobile banking app. Why, though? In any case, they get a great deal of benefit. Just a few examples are:

Ease

Remote cheque deposits are only one feature offered by many mobile banking apps. You can do things like check your balance, transfer money and get an overdraft alert without ever having to step foot in a bank. It helps you save a lot of time.

Features

While instantaneous peer-to-peer payments may not be your top priority, many banks now provide this convenient option via their mobile banking apps. You may use a digital banking app to find the nearest ATM, make cash withdrawals without using your card, and keep tabs on your finances all in one convenient place.

Security

Biometric login is supported by many modern digital banking applications. For instance, the Lloyds Bank app supports biometric authentication methods including fingerprint and face recognition. Let your app automatically check for potential threats.

Management

When compared to traditional banking locations, mobile banking applications and websites often do not impose any limitations on the time of day you may do transactions like depositing a cheque or transferring funds between accounts. In addition, regular financial dealings are becoming less complicated.

How do mobile banking apps work?

It's the same bank you've always used, but now you can do everything from your smartphone.

In order to better serve their clients, banks are increasingly turning to digital versions of formerly paper-based procedures and services. The overarching goal is to provide each client with a one-of-a-kind banking experience.

These typically consist of the following actions and procedures (all the standard banking services that can be accessed anytime, anywhere through mobile phones, laptops, and compatible smart devices, without the consumer ever having to set foot in a bank branch).

In order to offer banks and their clients with optimal levels of cost effectiveness, security, and adaptability, digital banking applications depend on high-level process automation, web-based services, and APIs. Streamlined core analytics and data generation from integrated modern banking technologies like Xero accounting  allow for a completely digital client experience.

How secure are mobile banking apps?

Most mobile banking applications don't save your financial information locally on your device, but instead get it from a remote server in a secure data centre. 

If your mobile app is hacked, your bank may give you a reimbursement. If you've exercised reasonable caution and haven't abused the service, a UK bank will reimburse you for any unauthorised transactions that resulted in a loss. According to the Financial Conduct Authority website: 

The bank must provide the compensation as quickly as possible. Unless the bank has cause to suspect fraud, this should be done before the end of the next business day.

However, most financial institutions do not publicise their policies on protections against fraud while using a mobile device to access online banking. You should call your bank and double-check your account status before going online if you have any concerns.

If the protection offered by your bank is inadequate or nonexistent, you may want to look elsewhere for a checking account. 

When you access your bank account online or via your mobile device, you can be certain that no unauthorised parties will be able to access your funds. Still, caution is warranted; never give anybody access to your online or mobile banking credentials.

Download the official version from the app store and keep the app updated so you can take advantage of any new security features before using any of the mobile applications mentioned in this tutorial. Screen locks (passwords, PINs, patterns, fingerprints) are another important layer of security for your mobile device.

Leading Digital Banking Apps: The Verdict 

Mobile banking applications aren't going away any time soon. Banks are becoming more concerned with cost-effectiveness and the need to deliver a distinctive client experience, both of which point to a continued trend towards a more digitised financial system. 

Nearly half of the world's population is projected to utilise digital banking by next year. New clients will be attracted to digital-only banks since they can create accounts in a matter of minutes. 

You should check that the bank is properly regulated by the Financial Conduct Authority and covered by the Financial Services Compensation Scheme before using any digital banking applications.

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• Best International Banks for Expats & Digital Nomads