Online Bank Accounts - Which bank is the best for you?

In recent years, the UK has seen an increase in the number of entirely online banks emerging. With big-name brands such as Monzo and Starling shunning the high-street and going online; instead, online banking services have become ever more popular, accessible and exciting in 2020 than ever before.

A few years ago back in 2018, it was estimated that around 69% of the UK were using digital banking - fast forward to 2020 and it’s increased to 76% with approximately 12 million UK adults having entirely switched to digital, by opening a digital-only bank account.

With the online banking industry only appearing to grow, many customers are asking what it is about online banks that’s causing so many of the UK public to make the digital switch. And with this being said, could they also benefit from opening an account?

What is an online bank account?

Online banking or an online bank account, whether it be a savings or current account, refers to the ability to be able to access your account and any transaction via the internet, using smartphone, tablets or computers.

Online banking provides users with the ability to manage their accounts online whenever and wherever they need to - eliminating the need for a physical high-street branch or even monthly statements as everything can be accessed digitally or via customer support.

Can I open a UK bank account online?

Opening an online bank account in the UK has vastly become one of the easiest ways for customers to open a personal account without having to make appointments or provide an abundance of paperwork.

Instead, to apply all you’ll need to do is visit an online banking provider’s website or download their app. You’ll then need to fill in an application form for your account with your personal details, including your name, date of birth and UK living address.

In most cases, you will also be required to provide photo identification and/or proof of living address, which you will need to take a photo of.

Once your application has been processed and your details confirmed (this can take as little as a few minutes to up to 24 hours) - you’ll be able to debit your funds into your account straight away and should receive your card in the post within 3 to 5 working days.

What are the advantages of online banking?

With so many UK customers making the switch to digital banking we’ve taken a look at just a few of the most common reasons as to why customers are now shunning brick-and-mortar banks in favour of trendy online banks.

• Greater accessibility
• Quicker and more efficient
• Competitive rates and introductory offers
• Better money management
• Easier money transfer
• Advantages of additional features

Greater accessibility

For many, online banking is far more convenient for users with everything they need being in the same place. All online banks have mobile banking options that allow users to control everything on their accounts from the touch of a button. From paying bills and standing orders to savings accounts and even applying for personal finance - customers can have access to everything they need without having to download multiple apps or visit their local branch.

Quicker and more efficient

It can be a hassle to have to leave your home and venture to your nearest card machine to read your balance or visit your bank to deposit or transfer some money. With online banking account balances, transfers, and management can all be done from the app. As well as this, many online banks provide the option to top-up in a variety of different ways, such as at your local post office or convenience store.

Competitive rates and introductory offers

As there is so much competition in both the online and high-street banking world, many online banks offer more competitive rates of interest for savings accounts and personal loans - as well as introductory to entice customers to sign up.

And seeing as the pandemic has affected the BoE base rate that many traditional banks use, many savers have been switching their savings accounts for better rates.

Better money management

Having a smartphone app for your banking has many benefits, aside from simply being able to access your account at home or on the go. As well as this, many online banks offer real-time spending notifications, as well as budgeting and spending limits for more efficient money management if you’re trying to watch what you spend.

Easier money transfers

Whether you’re transferring money from your other accounts or to friends and family, money transfers can be done quickly and simply from your online banking app. Online banks can also have the advantage of no additional fees for transferring money to friends and family abroad.

What are the best online bank accounts?

The best online banking accounts differ vastly from customer to customer, dependent on individual needs and requirements. However, if you’re looking to compare different accounts and their benefits, we’ve compiled a few of the most popular online accounts to compare the advantages.

Breakdown:

Monese

Who are Monese?

Monese are the online mobile money account that can help you to start spending, saving and even sending money within minutes—partnered with other giants such as the Post Office, PayPoint, Avias, PayPal and Paysafe: Cash.

What features does Monese have?

Asides from making it super easy to sign up securely for a Monese account, they also provide additional noteworthy features including the ability to send, request and receive money across the UK and event abroad for free with other Monese accounts.

Monese also provides budgeting tools in their app to help you stay on track with your spending each month. With their Overview tool, you can set your own monthly and even weekly budgets - getting instant notifications on your spending and whether you’re going over budget.

Customers also have the option to pay for their subscriptions monthly or annually, receiving a 30% discount if they pay for their yearly subscription upfront.

What’s included in each subscription?

Simple

• Free contactless debit card
• Free ATM and cash top-ups of up to £200
• Free currency card spending of up to £2,000
• Free and instant foreign currency transfers to other monese accounts

Classic

• Free contactless debit card
• Free ATM and cash top-ups of up to £900
• Free currency card spending of up to £9,000
• Free and instant foreign currency transfers to other monese accounts

Premium

• Free contactless debit card
• Free ATM and cash top-ups
• Free currency card spending
• Free and instant foreign currency transfers to other monese accounts

Revolut

Who is Revolut?

Revolut are the online bank that is helping customers to get more from their money, by not only offering a variety of different subscriptions, but also the ability to invest your money in things such as cryptocurrency, stocks and even gold.

What features does Revolut have?

Revolut has a high amount of different features; however, just a few of them include things such as:

• Budgeting and spending analytics
• Junior accounts for children
• Investing opportunities for crypto, gold, stocks, commodities and vaults
• Rewards
• Travel and device insurance
• Safety features for your money and account

What’s included in each subscription?

Standard

• Free UK account
• Free Euro IBAN account
• No fee withdrawals on up to £200 per month
• Free card (excluding delivery)
• Instant access to 5 cryptocurrencies
• Revolut junior account for one child
• One free cross border transfer per month

Premium

• Free UK account
• Free Euro IBAN account
• No fee withdrawals on up to £400 per month
• Free card (excluding delivery)
• Instant access to 5 cryptocurrencies
• Revolut junior accounts for up to two children
• Unlimited cross border transfer per month
• Overseas medical insurance
• Delayed baggage and flight insurance

Metal

• Free UK account
• Free Euro IBAN account
• No fee withdrawals on up to £200 per month
• Free card (excluding delivery)
• Instant access to 5 cryptocurrencies
• Revolut junior accounts for up to five children
• Unlimited cross border transfer per month
• Overseas medical insurance
• Delayed baggage and flight insurance
• 0.1% cashback within EU and 1% outside the EU
• Discounts with Perks Plus

Starling Bank

Who is Starling Bank?

Starling Bank is changing the way that both consumers and businesses bank for the better. They’ve been recognised as Best British Bank by the British Bank Awards for three years running from 2018 to 2020.

What features does Starling Bank have?

Starling provides a range of accounts and services, which include current accounts, business banking, personal and business loans, overdrafts and international money transfers.

In addition to this, in light of the recent pandemic, Starling is also offering Coronavirus Support and guidance in the event that your circumstances change and you are struggling to repay any overdrafts or personal loans.

What’s included in the subscription?

Current account

• No monthly fees
• Earn 0.05% AER on balances of up to £85,000
• Support for those affected by coronavirus
• Saving goals
• Ability to provide a trusted person with a card to your account to buy things on your behalf should they need to
• Protection for your money by the Financial Services Compensation Scheme (FSCS) eligible deposits of up to £85,000
• Deposit cheques of up to £500 from your phone in the app
• Real-time spending notifications to help you keep within budget
• ‘Round up’ feature to help you boost your savings
• ‘Settle up’ feature to help you split and pay for bills easier
• Nearby payment options allowing you to pay other Starling bank members from your mobile without any bank details

Are you considering making the online switch?

As the internet banking industry continues to boom, it becomes increasingly likely that more banking customers in the UK will open their accounts - with some moving away from traditional bank accounts altogether. If you’re interested in dipping your toe into the world of digital banking - you can compare your options with Fablious.