The days of having to visit a bank branch to open a new checking account are over. Online banks have made it easier than ever to find a decent checking account that offers tons of value. But to take advantage, you need to know how to open a checking account online.
You'll find many of the same benefits with an online checking account as an account at your local bank. They also feature attractive terms -- some even pay interest. And others pay cash bonuses just for opening an account. Some people are intimidated by the idea of opening a checking account via the internet. Online banks have done a good job of streamlining, so it's an easy process for everyone.
Follow the step-by-step checklist below to understand how to open a checking account online.
Step 1: Pick the checking account you want
To open an online checking account, first you need to find a bank or credit union. There are dozens of banking institutions that do business almost exclusively over the internet. Others have extensive physical branch networks but still let customers open checking accounts online. Do some comparison shopping to find the best checking account for you.
As you look, keep the following things in mind:
- Most checking accounts are very similar. But you may find better terms with an online checking account. Some will pay interest on your money so keep your eyes on interest rates and checking account fees. Find out whether there's a monthly maintenance fee or any overdraft fees. Look for the best combination of maximum income and minimum fees.
- Check for any bank requirements. You may need to meet a minimum opening deposit. Some banks also charge a monthly fee if your balance falls below a certain minimum amount. If you expect to drop below that minimum balance regularly, you're better off with a bank that has low minimums -- or none at all.
- Pay attention to a bank's customer service options. Some customers like banks that have both online and branch operations, so they can still access in-person service. These days, online banks offer various customer support options. Also, make sure the ATM network works for you. Some online checking accounts will reimburse ATM fees; others have large fee-free ATM networks.
Some banks offer cash incentives to entice new customers to open an online checking account. You'll need to meet specific account requirements to qualify for bonuses. However, some offers pay out hundreds of dollars. As such, it's worth considering if you're planning to open an online checking account anyway.
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Step 2: Find and complete the online checking account application
Opening a checking account used to be a complicated process. You had to make sure you brought all the right documents, including identification, to a physical bank branch. Sometimes, several trips were necessary. These days, new online applications have made it a lot easier to open your online checking account.
Now you just need to have your personal information on hand, including your:
- Full name
- Physical address
- Date of birth
- Social Security number or tax identification number
- Driver's license
If you already have another account with that bank, it's often much simpler to open a checking account. The bank already has most of the necessary information, so it can usually use it on the new checking account application. You'll just need to verify that nothing's changed since your last account opening.
Banks are usually able to accept and approve applications for online checking accounts within minutes. Once the bank approves your application, there's just one step left before you can start using your new online checking account.
Step 3: Put money into your checking account
The last step in opening a new online checking account is funding it. The easiest way to get money into your new account is through an electronic funds transfer from an existing bank account. Some banks include the funding process into the initial application process. Then, once your account is approved, your new bank will immediately start the process of moving money from the funding source.
If you don't have a bank account somewhere else, there are other alternatives. Most online checking accounts will allow you to make a mobile deposit through online banking. You may be able to send a physical check to your new bank by mail. You can also use a faster method, such as a wire transfer, to get money into your account.
Banks might put a hold on initial deposits before you're able to withdraw your cash, either through ATM withdrawals or by writing checks. However, those holds are generally relatively short. Your bank should inform you of any such requirements during the application process.
Step 4: Decide how you're going to use your online checking account
Once your account is open, you'll need to decide how you're going to use it. One question to consider is whether you'll need physical paper checks. Many people find features like online bill pay are enough for routine transactions.
Paper checks used to be the primary reason to open a checking account as opposed to a savings account. Now, a lot of people don't write physical checks. Instead, they take advantage of various online banking features. For example, they use a debit card to make purchases or withdraw cash at an ATM. Between debit purchases, ATM withdrawals, and automatic payment features, it's possible to have a checking account and never write a check. Many online accounts don't even offer an option for paper checks. An online checking account usually includes a direct deposit option, too.
The thought of banking online scares some people. But once you know how to open a checking account online, you realize it's not that difficult. As long as you follow these easy steps, you'll have an online checking account up and ready before you know it.
The best checking accounts for beginners
If you're thinking about opening your first checking account, take extra time to determine what you want from a new bank account. Pay close attention to fees, customer service offerings, and ATM access when choosing a checking account. With more banking being done on the go, you may want to consider banks offering modern digital banking features. Below are some checking account options to consider.
Chime Checking Account
Chime Checking Account is a basic online checking account with few fees and access to around 60,000 fee-free ATMs nationwide. Account holders also enjoy features like early direct deposit (up to two days early) and mobile check deposit.
Ally Interest Checking
Another online checking account to consider is Ally Interest Checking. The checking account comes with no monthly maintenance fees or minimum balance requirements, and earns interest on all balances. Customers who also have an Ally Online Savings account can boost savings through round-ups on debit card purchases. Ally customers have access to around 43,000 fee-free ATMs nationwide.
Capital One 360 Checking
The Capital One 360 Checking has a ton to offer banking customers. The account carries very few fees, has no minimum balance requirement, and offers access to around 70,000 fee-free ATMs. Capital One customers can also receive direct deposits up to two days early. One of the most unusual features of Capital One accounts is access to Eno, its virtual banking assistant. Eno is available through the mobile app, smart watch, text, and email to answer questions and fulfill other banking needs.
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Don't get caught paying nuisance checking account fees. Check out The Ascent's top checking account picks to open a fee-free checking account that earns a high interest rate.
About the Author
Kevin Payne is a personal finance writer specializing in credit cards, banking and student loans. He is a regular contributor to Forbes, Student Loan Planner, and FinanceBuzz. Kevin is the budget and family travel expert behind FamilyMoneyAdventure.com. He lives in Cleveland, Ohio with his wife and four kids.
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