Thinking of switching to a digital bank? Here are the best online-only banks and apps to choose from.
Which are the best digital banks out there? It’s a tough question and one that’s not easy to answer. Digital banking has grown massively over the last few years. Many challenger brands have jumped at the chance to impress customers, with many attracting praise along the way. As such, it can be difficult to separate out which banks offer what, and who they’re best suited for. Luckily for you, we’ve taken a close look and picked out the top 10 best digital banks for a wide variety of users. As well as creating a comparison, we’ve also taken a more detailed look at which might be best suited for you.
The best digital banks at a glance
Below, you can find our quick comparison table. As well as some of the main pros and cons of each, we’ve also highlighted who each one is best for:
Competitive fees on international transfers.Access to multicurrency Mastercard.
No cash or cheque options.For larger transfers, specialist providers are often cheaper.
Rates are given in real-time. Basic account is free and full of features.
Optional features cost extra. No cash or cheque options.
Innovative and ethically conscious bank.International transfers available.
Monthly cost for holding an account. Many additional fees.
Accounts in GBP and EUR. Open account without credit check.
Limits on cash transactions. Not part of FSCS scheme.
Different pots for budgeting. Instant spending notifications.
App only – no browser option.Fees for paying in cash and cheques.
Established P2P lender.Range of investment options.
High minimum deposit rate. Returns can be relatively low.
Business and personal accounts. Low fees, free trial.
No credit or overdraft features. Fees for foreign currency transactions.
Interest on current account balance. Overdrafts and loans available.
Cash and cheque payments are inconvenient. Replacement card is costly.
Mortgages and savings
Good range of saving options. Competitive AER interest rates.
App isn’t the best. Product range is still fairly limited.
Teaching financial responsibility
Full parental control, including spending limits. Reward system teaches about finances.
Fees for many of the best features. Only one free top-up to child account per month.
A closer look at the best digital banks
Now it’s time to turn our attention to a more detailed look at each. We explore what makes each one a suitable choice for consumers, and include relevant links and information:
Best for multicurrency transfers – TransferWise
With the TransferWise borderless account, you get low-cost money transfers that are, according to the company, up to eight times cheaper than regular banks. You can also hold your funds in over 40 different currencies. So, if you’re the type of person who tends to make a lot of transfers overseas, this could be the account for you.
Similarly, you can receive payment in GBP, USD, EUR, and AUD without paying any fees. You can also get account details for each of these currencies. Of course, it’s not a flawless system. For those who make regular large payments, you could be better off using a speciality service. Similarly, if you make a lot of cash payments into your account, you should look elsewhere.
Best for international payments – Revolut
Revolut is one of the fastest-growing digital banks in the UK, and for good reason. The feature-laden account gives you access to all kinds of benefits. Perhaps most notable is the fact you can top up your card in several currencies. So, if you’re travelling overseas a lot, you can reduce your fees overall. What’s more, with the premium features, you can get free travel insurance. You can also hold your cryptocurrency balance in your Revolut account.
As with TransferWise, there are no options for paying cash into your account. And, if you want access to the best features, you’re going to have to pay a monthly fee. So, depending on how much you use it, there are no guarantees you’ll be better off.
Best for ethical banking – bunq
As a relative newcomer to the digital banking space, bunq are trying to do things a little differently. The firm is actually partnered with TransferWise, meaning that you get the same great rates on international transfers. You’ll also get access to instant payments and can make up to 10 free ATM withdrawals per month.
Ethical banking is at the heart of what bunq do. They have a variety of environmentally conscious incentives for their customers. However, there is no free version of the service, and it’s only currently available in Euros. What’s more, many of the best features incur extra charges, which can soon rack up.
Best for overseas students – Monese
Whether you’re a student from overseas studying in the UK or a local student heading abroad, Monese is a good choice of bank. Students get access to a free Classic account for 12 months, and you won’t need proof of address of a credit history check to open an address. Once you have the app, you’ll get real-time notifications and a balance graph of your spending.
Unlike many of the accounts on here, you can deposit cash directly into your account using the Post Office of PayPoint, and can hold both a UK and Eurozone account. However, once your free 12 months is up, you’ll have to pay a monthly fee. Similarly, there are costs for withdrawals over a certain threshold, as well as foreign currency exchanges.
Best for effective budgeting – Monzo
Monzo is practically an established name in the digital bank world these days. The company has spent time developing a broad range of features to help you manage your money better. You can set budgets, create savings pots, and keep money aside for bills. If you’re looking to save money, this is the bank for you. You’ll also get access to things like free overseas cash withdrawals (up to £200 per month) as well as no transaction fees on overseas spending.
Monzo has gradually added other features such as overdrafts, loans, and joint accounts, making it a viable choice as a main account. However, there are some limits and fees associated with the account. You can only deposit a maximum of £1000 cash every six months, and it costs £1 per deposit using PayPoint.
Best for savings accounts – Zopa Bank
Zopa started life as a peer-to-peer lending company but has since gained a full banking licence. The newly formed Zopa Bank offers savings accounts and credit cards to customers. You get five savings options to choose from, with investments ranging from one to five years. It’s quick and easy to get started with, and you’ll get an interest rate ranging from 1.05% to 1.30% AER depending on which account you choose.
Because of its banking licence, your funds are protected by the Financial Services Compensation Scheme. However, you’ll have to deposit at least £1,000 to get started. What’s more, the rates on offer aren’t as competitive as some as the other long-term savings options.
Best for business banking – ANNA
ANNA gives you an online business current account with a range of features to help you manage your finances. The account is aimed at SME owners and gives you access to a Mastercard debit card. Features include automatic invoicing and invoice management, 1% cashback on your business spend and access to a range of additional employee cards.
If you’re relatively new to the world of business banking, ANNA can help keep you on track with your finances. However, you don’t get access to many of the essentials you might need from a fully-fledged business account, such as overdrafts and a line of credit.
Best for everyday accounts – Starling
When it comes to all-rounders, they don’t come much better than Starling Bank. The challenger brand gives users access to a full UK current account that you can manage directly from the app. It takes only a matter of minutes to get started, and there are plenty of features for just about everyone. Unlike the majority of the other best digital banks, you get interest paid on your balance, as well as access to an overdraft.
If you’re looking for an account you can use as your main current account, you can’t go far wrong with Starling. However, some of the more advanced features, such as mortgages and more complex forms of lending, aren’t available yet.
Best for mortgages and savings – Atom
Atom is another brand that offers a range of long-term savings options, as well as mortgage features. You can get set up with an account in just a few minutes, and you’ll get a clear view of your funds and interest rates through the app. If you’re trying to build your savings, Atom will actively encourage you to do so, as well as show you how much your possible returns are.
The rates with Atom are competitive, ranging from 0.75% AER to 1.5% AER, depending on whether you opt for a 3-month or 5-year fixed saver. However, you don’t get a bank card with Atom, and you’ll miss out on many of the features a full bank account gives you.
Best for teaching financial responsibility – goHenry
goHenry is a financial tool that’s designed for children from the age of 6 to 18. The app-based account gives parents access to the account, allowing them to view and control their children’s’ spending habits. For the child themselves, they can see their balance and use a prepaid Visa card to make purchases and withdraw money. Every time the child uses the card, you’ll get a notification on your own app. You can also set up a reward system, where funds are sent to their account when they complete certain tasks. The tool aims to help children learn about managing their money while giving parents the control they need to oversee this. However, there is a monthly fee associated with the account, and it costs to use the card overseas. The account only benefits from one free top-up per month, with fees associated after that.
Honourable mention – Virgin Money
Last on our list is Virgin Money, with an honourable mention. The free, app-based account has some great features, making it a good all-rounder. With the current account, you get 2.02% AER (2.00% gross per annum variable) on up to £1,000, with interest paid monthly. You also get a free savings account offering 0.50% AER (0.50% gross per annum variable) on your savings, with interest paid quarterly. It’s free for everyone and takes just a few minutes to set up.