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Bethany Garner,Jo Thornhill
Editor,Editor
Published: Feb 5, 2024, 5:45pm
Reviewed By
Laura Howard
Editor
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Important Disclosure: The content provided does not consider your particular circ*mstances and does not constitute personal advice. Some of the products promoted are from our affiliate partners from whom we receive compensation.
If you require any personal advice, please seek such advice from an independently qualified financial advisor. While we aim to feature some of the best products available, this does not include all available products from across the market. Although the information provided is believed to be accurate at the date of publication, you should always check with the product provider to ensure that information provided is the most up to date.
Do you tend to carry out life admin — including managing money — from your phone? If the answer’s yes, you may benefit from an online-only or ‘digital’ current account. These are offered by banks that operate without any branch network, often referred to as challenger banks.
Digital bank accounts are operated by an app on your phone that offers real-time management tools that are designed to streamline the way you interact with your money.
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- Featured Partner - Switching Offers
- What are the best digital bank accounts?
- Starling Bank Personal Current Account
- Chase Current Account
- Kroo Current Account
- Revolut Business
- Monzo Current Account
- Revolut
- Cashplus Freedom
- Monese Premium
- What’s our methodology?
- What are online bank accounts?
- Is an online bank account right for me?
- Featured Partner - Switching Offers
- Frequently Asked Questions
- Next Up in Banking
Guides To Banking
- Best Current Accounts
- Best Bank Account Switching Offers
- Best Joint Bank Accounts
- Best Online Bank Accounts
- Best Student Bank Accounts
- Best Basic Bank Accounts
- Best Free Budgeting Apps
1
Kroo
Earn 4.35% AER on credit balances
Fee-free spending abroad
1
Kroo
On Kroo’s Website
Featured Partner
2
Starling Bank
24/7 UK-based customer support
Smart budgeting tools, Earn 3.25% AER on balances up to £5,000
2
Starling Bank
On Starling Bank’s Website
Featured Partner
What are the best digital bank accounts?
But not all digital accounts are the same — some will suit your needs better than others. So we’ve carried out research (March2024) and identified five of what we consider to be the top deals to suit a range of purposes. However, always carry out a fresh search and compare deals when you are ready to apply.
FEATURED PARTNER OFFER
BEST ALL-ROUNDER
Starling Bank Personal Current Account
5.0
Our ratings take into account a product's rewards, fees, rates and other category-specific attributes. All ratings are determined solely by our editorial team.
Monthly Fee
£0
Overdraft
Up to £5,000
Key Perk
Connect app with accounts from other providers
Representative example for overdraft
The representative APR example gives you an estimate of how much it might cost if you borrowed a certain amount of money. This helps you compare products and provides a guide on how much carrying a balance could cost. Your personal offer may vary from the representative APR example.
If you use an arranged overdraft of £1,200, you’ll be charged the Equivalent Annual Rate of up to 35% (variable). Representative APR 35% (variable). Subject to financial status.
On Starling Bank's Website
Monthly Fee
£0
Overdraft
Up to £5,000
Key Perk
Connect app with accounts from other providers
Representative example for overdraft
The representative APR example gives you an estimate of how much it might cost if you borrowed a certain amount of money. This helps you compare products and provides a guide on how much carrying a balance could cost. Your personal offer may vary from the representative APR example.
If you use an arranged overdraft of £1,200, you’ll be charged the Equivalent Annual Rate of up to 35% (variable). Representative APR 35% (variable). Subject to financial status.
Why We Picked It
Starling is one of the few banking providers that pays credit interest on balances: 3.25% AER (variable) on balances up to £5,000. You’ll earn the same rate when you set money aside automatically in its ‘spaces’ or virtual piggy banks.
Other in-app features include generating a personal payment link, so you can get paid without giving out bank details, and app cheque imaging, which means you can scan and pay in a paper cheque, digitally.
Through Starling’s ‘marketplace’ you can open and manage some third-party products, such as savings accounts and mortgages, without leaving the app.
If you’re eligible, the account comes with an overdraft facility at a representative APR of 15% (variable) which compares to a more typical 39.9% with other major banks. Although you could be offered 25% APR or 35% APR.
Pros & Cons
- No monthly fee
- In-credit interest
- Competitive overdraft rates
- Fee-free card spending and cash withdrawals overseas
- App cheque imaging
- Soft credit check on application
- Overdraft rates up to 35% APR (variable)
FEATURED PARTNER OFFER
BEST FOR CASHBACK
Chase Current Account
5.0
Our ratings take into account a product's rewards, fees, rates and other category-specific attributes. All ratings are determined solely by our editorial team.
Monthly Fee
£0
Overdraft
No
Key Perk
1% cashback on everyday debit card purchases
For your first 12 months (exceptions and limits apply)
Monthly Fee
£0
Overdraft
No
Key Perk
1% cashback on everyday debit card purchases
For your first 12 months (exceptions and limits apply)
Why We Picked It
This current account from Chase pays 1% cashback on day-to-day debit card spending for your first 12 months for new customers, capped at £15 per month.
Cashback is paid into your ‘rewards balance’ where it can be transferred into a Chase current or saver account you hold.
There are some exclusions, however. You can’t earn cashback on certain types of purchase, such as cars, antiques, insurance, and gambling transactions.
Chase does not charge any transaction fees when customers use their debit card abroad, and customers also earn interest of1% AER (1% gross) variable on their balance.
There’s also a linked ‘round-up account’, paying 5% AER (4.89% gross) variable. With this account open, customers can automatically round up their transactions to the nearest £1, and deposit the spare change.
Elsewhere, the Chase easy access account pays 4.1% AER (4.02% gross) variable (you must have a Chase current account to open one). You can also open an investing account with Nutmeg, which offers a selection of ready-made portfolios, through the Chase app. Note that management fees apply.
This account must be opened and managed exclusively via the Chase banking app and it does not offer an overdraft facility.
Pros & Cons
- 1% cashback on everyday debit card purchases for your first 12 months (exceptions and limits apply)
- Chase doesn’t charge overseas transaction fees
- Earn 1% AER on current account balance
- No monthly fee
- No overdraft facility
- Time-limited cashback offer
FEATURED PARTNER OFFER
BEST FOR CREDIT INTEREST
Kroo Current Account
5.0
Our ratings take into account a product's rewards, fees, rates and other category-specific attributes. All ratings are determined solely by our editorial team.
Monthly fee
£0
Overdraft
Up to £3,000
Key Perk
4.35% AER (variable) on balances
Representative Example
The representative APR example gives you an estimate of how much it might cost if you borrowed a certain amount of money. This helps you compare products and provides a guide on how much carrying a balance could cost. Your personal offer may vary from the representative APR example.
If you use an arranged overdraft of £1,200, you’ll be charged the Equivalent Annual Rate of 24.9% (variable). Representative APR 24.9% (variable). Subject to financial status.
On Kroo's Website
Monthly fee
£0
Overdraft
Up to £3,000
Key Perk
4.35% AER (variable) on balances
Representative Example
The representative APR example gives you an estimate of how much it might cost if you borrowed a certain amount of money. This helps you compare products and provides a guide on how much carrying a balance could cost. Your personal offer may vary from the representative APR example.
If you use an arranged overdraft of £1,200, you’ll be charged the Equivalent Annual Rate of 24.9% (variable). Representative APR 24.9% (variable). Subject to financial status.
Why We Picked It
If earning interest on your balance is a key priority, this app-only current account from Kroo could be worth considering.
Account holders can earn 4.35% AER (4.27% gross) on balances up to £500,000 — outpacing many top-paying easy access savings accounts.
You’ll also benefit from fee-free spending abroad, and app functionalities including a shared expenses tracker and budgeting tools.
If you regularly deposit cash or cheques, Kroo may not be the right fit since the bank does not currently support cash or cheque deposits.
While Kroo does provide overdrafts, they’re offered on an invite-only basis and eligibility criteria apply. If you are accepted for an overdraft, you’ll pay a single rate of 24.9% APR.
Kroo is a fully-licensed UK, and your money is protected up to the value of £85,000 under the Financial Services Compensation Scheme (FSCS).
Pros & Cons
- Earn interest on your balance
- No foreign transaction/ cash withdrawal fees
- No monthly fee to operate account
- Overdraft available by invitation only
- No cashback or rewards
- Cash and cheque deposits not accepted
- No joint account option
FEATURED PARTNER OFFER
BEST FOR BUSINESS
Revolut Business
5.0
Our ratings take into account a product's rewards, fees, rates and other category-specific attributes. All ratings are determined solely by our editorial team.
Monthly fee
£0
Overdraft
N/A
Key perk
Hold and spend multiple currencies
Monthly fee
£0
Overdraft
N/A
Key perk
Hold and spend multiple currencies
Why We Picked It
Revolut’s Free Business Bank account comes with no monthly fees, and account holders can make up to five UK bank transfers each month free of charge. When this limit is exceeded, each transfer costs 20p. Transfers to another Revolut account are free.
International payments are also charged on a pay-as-you-go basis, costing £5 each.
The account could be a good option for companies that regularly do business abroad, since customers can hold and spend multiple currencies.
The app provides a detailed breakdown of cash flow, can be used to generate invoices and is compatible with accounting software including Xero and QuickBooks.
Revolut also offers fee-charging accounts that provide extra free transactions each month. All accounts can be opened and managed through the Revolut app.
It’s worth noting that Revolut is not a bank but an e-money institution. This means that money held in a Revolut account is not covered by the Financial Services Compensation Scheme (FSCS). Instead, money is ‘safeguarded’ — placed in a trusted bank, invested in low risk assets, or protected by an insurance policy. This ensures that if Revolut fails, the company has sufficient funds to return all its former customers’ money. You will need to be at least 18 years old to qualify for this account.
Pros & Cons
- No monthly fee
- 5 free bank transfers per month
- Create invoices in app
- Compatible with accounting software
- Hold multiple currencies
- No overdraft facility
- Fees for international payments
FEATURED PARTNER OFFER
BEST FOR OVERSEAS SPENDING | BEST FOR BUDGETING
Monzo Current Account
Our ratings take into account a product's rewards, fees, rates and other category-specific attributes. All ratings are determined solely by our editorial team.
Monthly Fee
£0
Overdraft
Up to £2,000
Key Perk
No fees on card spending abroad or ATM withdrawals up to £200
Representative example for overdraft
The representative APR example gives you an estimate of how much it might cost if you borrowed a certain amount of money. This helps you compare products and provides a guide on how much carrying a balance could cost. Your personal offer may vary from the representative APR example.
If you use an arranged overdraft of £1,200, you’ll be charged the Equivalent Annual Rate of 39% (variable). Representative APR 39% (variable). Subject to financial status.
Monthly Fee
£0
Overdraft
Up to £2,000
Key Perk
No fees on card spending abroad or ATM withdrawals up to £200
Representative example for overdraft
The representative APR example gives you an estimate of how much it might cost if you borrowed a certain amount of money. This helps you compare products and provides a guide on how much carrying a balance could cost. Your personal offer may vary from the representative APR example.
If you use an arranged overdraft of £1,200, you’ll be charged the Equivalent Annual Rate of 39% (variable). Representative APR 39% (variable). Subject to financial status.
Why We Picked It
Monzo charges no foreign transaction fees for using your debit card abroad, while you can make free unlimited withdrawals in the European Economic Area (EEA), and free withdrawals up to £200 per month everywhere else.
Through the Monzo current account app, you can manage standing orders and direct debits, split bills, view a categorised breakdown of your spending, and receive notifications about past and upcoming transactions.
Another handy tool is the automated savings which either rounds up every transaction to the nearest £1 and sets aside the change in a pot, or automatically puts money aside every time you spend. There’s also the option to invest money via the app, though you’ll only have three funds to choose from (management fees apply).
You can also arrange to pay your bills from a designated ‘savings pot’. By setting aside money for your regular payments, it’s easier to create a budget from what’s left.
If you’re eligible, you could get an overdraft of up to £2,000 at Monzo. The interest rate you’re charged will be 39% EAR (variable) depending on your credit score and circ*mstances.
Any UK resident aged 16 or over can open a Monzo current account.
Pros & Cons
- No monthly fee
- Fee-free card spending and cash withdrawals overseas
- Handy in-app tools
- Invest in-app
- No in-credit interest
- Limits to fee-free cash withdrawals outside Europe
FEATURED PARTNER OFFER
BEST FOR DIGITAL
Revolut
4.5
Our ratings take into account a product's rewards, fees, rates and other category-specific attributes. All ratings are determined solely by our editorial team.
Monthly Fee
£0
Overdraft
No
Key Perk
Digital experience
Monthly Fee
£0
Overdraft
No
Key Perk
Digital experience
Why We Picked It
Although it’s technically an e-money institution rather than a bank, Revolut is a top contender if you want to open a digital current account.
Digital-savvy features include requesting money through a link or QR code, bill splitting, and setting aside cash in a savings account called a Saving Vault. This one pays in-credit interest of 2.29% AER (variable). You can also set up automatic savings that round up transactions to the nearest £1 and set aside the change.
Another Revolut digital perk is the opportunity to earn rewards when you spend. Through the app, you can browse for deals with brands to earn cashback and other discounts. Customers can also book activities directly through Revolut ‘Experiences’ –an in-app marketplace for tours, activities and attractions – on which you could also earn cashback.
Revolut could also be a particularly strong choice for international payments, too. Through the app you can send and receive money in 29 different currencies without paying any fees. You can also use your card abroad as normal
However, with a Revolut Standard account you can only make five ATM withdrawals per month, or £200. After this, you’ll be charged a 2% fee on all withdrawals, and a minimum of £1 per withdrawal.
Bear in mind that your money won’t be covered by the Financial Services Compensation Scheme (FSCS) in Revolut. Instead, funds are protected through ‘safeguarding’ laws.
To open an account with Revolut, you must be at least 18 years old.
Pros & Cons
- No monthly fee
- Good digital user experience
- Cashback on spending
- Free international payments
- No overdraft
- Low limit on ATM withdrawals
- Not FSCS protected
FEATURED PARTNER OFFER
BEST FOR POOR CREDIT | BEST FOR MULTICURRENCY TRANSFERS
Cashplus Freedom
4.0
Our ratings take into account a product's rewards, fees, rates and other category-specific attributes. All ratings are determined solely by our editorial team.
Monthly Fee
£0
Overdraft
Up to £500
Key Perk
Open without a credit check
If you use an arranged overdraft of £500, you’ll be charged the Equivalent Annual Rate of 57.07% (variable). Representative APR 69.9% (variable). Subject to financial status.
Monthly Fee
£0
Overdraft
Up to £500
Key Perk
Open without a credit check
If you use an arranged overdraft of £500, you’ll be charged the Equivalent Annual Rate of 57.07% (variable). Representative APR 69.9% (variable). Subject to financial status.
Why We Picked It
If you have a poor credit score, the Freedom account by Cashplus could be a good option for your day-to-day banking needs.
The account can be opened online or via the app, and Cashplus won’t carry out a credit check.
Cashplus accounts are designed to be managed entirely through the app, although you can make cash deposits at any Post Office. Watch out for the 0.5% transaction fee here though.
You can only make nine electronic payments each month — including standing orders — free of charge, after which it’s 99p per transaction.
The app comes with some useful tools including payment notifications and spending insights.
It could also be useful for international travel as through the app, you can order a free additional card that lets you pay in Euros or Dollars which bypasses foreign exchange fees.
If eligible, you can also take out an overdraft with Cashplus.
The first £5 of your overdraft is interest free, but, as an account for poorer credit scores, the representative APR (variable) is 69.90%.
Pros & Cons
- No monthly fee
- Overdraft facility
- No credit check
- Add Euro or USD card at no extra cost
- Fees for cash deposits
- Limited number of electronic payments
- High overdraft rates
FEATURED PARTNER OFFER
BEST FOR EASY OPENING | BEST FOR OVERSEAS STUDENTS
Monese Premium
On Monese's Website
Monthly Fee
£14.95
Overdraft
No
Key Perk
No permanent UK address required
Why We Picked It
While this is the only digital account with a monthly fee, the fee-free alternative charges account holders 2% of their withdrawal value each time they withdraw cash, and a 3.5% fee to top up the account with cash.
However, in return for the £14.95 a month, this account will benefit either regular travellers or newcomers to the UK. That’s because you can open it without a credit check and do not require a permanent UK address. Instead, Monese will ask for an email address, phone number, and ID such as a passport.
With the premium account, you can make international payments and ATM withdrawals (up to £1,500 a month) fee-free. You can top up the account with up to £1,000 per month fee-free.
The Premium account also offers free insurance benefits: £2,100 worth of accident, sickness and involuntary unemployment protection, purchase protection of £10,000 a year, and hospital stay cover of £60 a day up to 30 days.
Monese does not offer overdrafts.
Pros & Cons
- No permanent address requirement
- No credit check
- Integrate Avios and Paypal
- Free international payments
- Add fee-free prepaid travel card
- Monthly fee
- No overdraft
- Not FSCS protected
What’s our methodology?
To rank these digital accounts, we’ve looked at app features from automatic saving to the ability to integrate other accounts from different providers.
We’ve also looked at more traditional features such as overdrafts and their cost and how cost-effective it is for spending abroad.
We’ve taken the best parts of each of these top accounts and suggested the kind of account holder they could be best suited to.
Unless stated otherwise, individuals must be a UK resident aged 18 or over to be eligible for these accounts.
All account details are correct at time of publication.
What are online bank accounts?
Online (or digital) bank accounts are a type of current account that can be opened and managed entirely online or through a smartphone app. You won’t be able to visit a branch, because the institutions that provide them exist entirely online.
When you open a current account with a digital bank, you’ll be able to access all the same services you would from a highstreet bank account – just from your phone in your own time.
These accounts can also make money management tools more accessible to people with a history of poor credit, since digital banks are less likely to carry out a full credit check when you apply for an account. Or, they will do a soft credit check which is not visible to other lenders.
Digital banks are not the right option for everyone, however. It’s important to carefully consider whether you’re happy to forgo in-person customer service and navigate a smartphone app.
Is an online bank account right for me?
If you want to open and manage your current account with a smartphone app, an online bank account could be a good fit for your needs.
As long as you’re confident using the app, it can be considerably more convenient than visiting a physical branch with limited opening hours. A growing number of individuals are turning to this service, as the graph below shows.
However, these accounts may not be the best solution if you prefer to do your banking in person, don’t have reliable access to a smartphone, or regularly make cash deposits.
Some providers, including Monese and Cashplus, allow you to make cash deposits through your local Post Office. Meanwhile, Monzo offers ‘pay points’ at local shops throughout the UK where you can deposit cash in your account.
However there are limits on how much you can deposit, and some providers charge fees for this service.
1
Kroo
Earn 4.35% AER on credit balances
Fee-free spending abroad
1
Kroo
On Kroo’s Website
Featured Partner
2
Starling Bank
24/7 UK-based customer support
Smart budgeting tools, Earn 3.25% AER on balances up to £5,000
2
Starling Bank
On Starling Bank’s Website
Featured Partner
Frequently Asked Questions
Will my money be safe in an online bank account?
If your digital bank is FCA authorised in the UK, any funds in your account will be protected by the Financial Services Compensation Scheme (FSCS).
This means if the bank fails, you are guaranteed to get your money back up to the value of £85,000.
That said, certain online account providers, including Revolut, are classed as e-money institutions rather than banks. If you open one of these accounts your money will not be covered by FSCS protection.
Instead, safeguarding laws require the provider to protect your funds by placing them in a dedicated ‘safeguarding’ bank account, investing them in low-risk assets approved by the FCA, or insuring them.
If the e-money institution fails, there should be enough cash set aside to pay out your final account balance.
Banking apps also make use of encryption and secure login practices to keep your account safe from unauthorised activity. You should always follow the security steps recommended by your account provider to minimise cybersecurity risks.
What can I do through the online banking app?
You can carry out all the day-to-day banking tasks you’d expect from a current account through the online bank’s app, including:
- Setting up and managing direct debits or standing orders
- Sending and receiving money
- Updating personal details
- Opening and managing an overdraft
Many of the apps offered by digital banks also come with added tools and functionalities that could make it easier to manage your money, such as in-app saving ‘pots,’ budgeting tools, and personal payment links that allow you to get paid without giving out bank details.
All the providers mentioned here offer customer support lines you can contact if you have questions or need help with your account.
Do online bank accounts come with an overdraft?
Some will offer this facility. But as with all borrowing, whether you’re eligible to use this facility will depend on your credit history.
Typically, you will need to apply for an overdraft separately once you have opened the bank account.
Who is eligible for an online bank account?
Different online banks have different eligibility criteria, but typically you’ll need to:
- Be aged 16 or over
- Live permanently in the UK
- Have a form of identification such as a passport or driving licence
- Have access to a smartphone
Some online bank accounts have less strict eligibility criteria. For instance, you don’t need a permanent UK address in order to open a Monese account.
How do I open an online bank account?
Opening an online bank account is usually very quick. Depending on the account, you can open it online, or by downloading the provider’s app from the App or Google Play store.
You’ll be prompted to enter the same personal details you would when opening a traditional current account. These details include your full name, date of birth, address, contact number, and employment status.
You must also have a valid form of photo ID — such as a passport or driving licence — to hand so the account provider can verify your identity.
Next, you will be asked to take a photo of your ID. You can usually do this directly through the provider’s smartphone app, but if you’re applying online with a browser, you may need to manually upload the photo.
Some providers, including Starling Bank, verify your identity by asking you to take a short selfie-style video to check you match your ID.
Once you’ve completed the application, you should find out instantly whether your application has been successful.
Your debit card and welcome pack will follow in the post within a few days, but you may be able to start using your account before the card arrives.
Can I open a joint digital bank account?
Yes — some online banks allow you to open an account jointly. The second account holder will need to provide their own personal details and ID during the application.
Some providers, including Monzo, require you both to hold an individual Monzo account before you can open a joint account.
Can I switch online bank accounts?
Yes — you can switch to a different online bank account whenever you want. Like their traditional counterparts, the majority of online bank accounts are covered by the Current Account Switch Service.
The service automatically moves your incoming and outgoing payments over to the new account and closes the old one.
Regularly changing your account provider helps ensure you’re always getting the best deal.
How does a digital bank account differ from traditional banks’ apps?
A digital bank account means the entire of your banking is carried out through an app, while many of the app-only banks offer extra features such as help with budgeting and saving. There might also be attractive deals and rates on overseas transactions and investing, for example.
In contrast, the traditional high street banking providers all offer app-based banking, but this is alongside more traditional banking methods, such as in branches, over the phone and online – so customers have a choice about how they do their banking.
But this usually also means higher charges on overdrafts, for example, or poor rates on credit balances and savings, compared to the challenger providers.
Another important difference is around the security of your money. While the traditional banks are all fully regulated and authorised by the Financial Conduct Authority (FCA), giving customers protection under the Financial Services Compensation Scheme (FSCS), this might not be true of all challenger and digital banking providers.
Always check what protection is available for customer deposits before you apply for a new account
Next Up in Banking
- Best Current Account Switching Offers
- Best Current Accounts
- Best Basic Bank Accounts
- Monese Review 2023
- HSBC Advance Account Review
- Best Banks For Expats In UK 2023
Guides To Banking
- Best Current Accounts
- Best Bank Account Switching Offers
- Best Joint Bank Accounts
- Best Online Bank Accounts
- Best Student Bank Accounts
- Best Basic Bank Accounts
- Best Free Budgeting Apps
Information provided on Forbes Advisor is for educational purposes only. Your financial situation is unique and the products and services we review may not be right for your circ*mstances. We do not offer financial advice, advisory or brokerage services, nor do we recommend or advise individuals or to buy or sell particular stocks or securities. Performance information may have changed since the time of publication. Past performance is not indicative of future results.
Forbes adheres to strict editorial integrity standards. To the best of our knowledge, all content is accurate as of the date posted, though offers contained herein may no longer be available. The opinions expressed are the author’s alone and have not been provided, approved, or otherwise endorsed by ourpartners.
Bethany GarnerEditor
I’ve been writing for a broad array of online publications for four years, always aiming to make important insights accessible. It’s my goal to ensure that as many people as possible can make informed decisions about their money, and get the most out of their finances with the least amount of stress.
Jo ThornhillEditor
I am passionate about personal finance issues and helping consumers navigate the world of insurance, credit, savings and pensions. I have been a money journalist for almost two decades, including ten years on the award-winning personal finance desk at the Mail on Sunday.