This article was subjected to a comprehensive fact-checking process. Our professional fact-checkers verify article information against primary sources, reputable publishers, and experts in the field.
Fintech (financial technology) has been changing how financial services are provided and used for many years now. But did you know that fintech "banks" exist as well? These fintech companies, or neobanks, are attempting to change the banking industry by making banking more convenient and accessible.
But is a neobank right for you? Here's everything you need to know about neobanks, including their benefits and drawbacks, as well as a few popular examples you may have heard of.
FinanceBuzz writers and editors score products and companies on a number of objective features as well as our expert editorial assessment.
Our partners do not influence our ratings.
Up to $300New and existing Checking and Savings members who have not previously enrolled in Direct Deposit with SoFi are eligible to earn a cash bonus of either $50 (with at least $1,000 total Eligible Direct Deposits received during the Direct Deposit Bonus Period) OR $300 (with at least $5,000 total Eligible Direct Deposits received during the Direct Deposit Bonus Period). Cash bonus will be based on the total amount of Eligible Direct Deposit. If you have satisfied the Eligible Direct Deposit requirements but have not received a cash bonus in your Checking account, please contact us at 855-456-7634 with the details of your Eligible Direct Deposit. Direct Deposit Promotion begins on 12/7/2023 and will be available through 1/31/2026. Full terms at sofi.com/banking. SoFi Checking and Savings is offered through SoFi Bank, N.A., Member FDIC.SoFi members with Eligible Direct Deposit can earn 3.60% annual percentage yield (APY) on savings balances (including Vaults) and 0.50% APY on checking balances. There is no minimum Eligible Direct Deposit amount required to qualify for the 3.60% APY for savings (including Vaults). Members without Eligible Direct Deposit will earn 1.00% APY on savings balances (including Vaults) and 0.50% APY on checking balances. Interest rates are variable and subject to change at any time. These rates are current as of 11/12/25. There is no minimum balance requirement. Fees may reduce earnings. Additional information can be found athttp://www.sofi.com/legal/banking-rate-sheet.
Minimum Opening Balance
$0
Monthly Fee
$0
Why We Like It
Earn a $50 or $300 bonus and up to 4.30% APY1 <p>New and existing Checking and Savings members who have not previously enrolled in Direct Deposit with SoFi are eligible to earn a cash bonus of either $50 (with at least $1,000 total Eligible Direct Deposits received during the Direct Deposit Bonus Period) OR $300 (with at least $5,000 total Eligible Direct Deposits received during the Direct Deposit Bonus Period). Cash bonus will be based on the total amount of Eligible Direct Deposit. If you have satisfied the Eligible Direct Deposit requirements but have not received a cash bonus in your Checking account, please contact us at 855-456-7634 with the details of your Eligible Direct Deposit. Direct Deposit Promotion begins on 12/7/2023 and will be available through 1/31/2026. Full terms at sofi.com/banking. SoFi Checking and Savings is offered through SoFi Bank, N.A., Member FDIC.</p><p>SoFi members with Eligible Direct Deposit can earn 3.60% annual percentage yield (APY) on savings balances (including Vaults) and 0.50% APY on checking balances. There is no minimum Eligible Direct Deposit amount required to qualify for the 3.60% APY for savings (including Vaults). Members without Eligible Direct Deposit will earn 1.00% APY on savings balances (including Vaults) and 0.50% APY on checking balances. Interest rates are variable and subject to change at any time. These rates are current as of 11/12/25. There is no minimum balance requirement. Fees may reduce earnings. Additional information can be found at<a href="http://www.sofi.com/legal/banking-rate-sheet" >http://www.sofi.com/legal/banking-rate-sheet</a>.</p> on your money with eligible direct deposit
Limited-Time Offer: +0.70% Boost on Savings APY for 6 months on new accounts with eligible Direct Deposit. Terms Apply.2 <p>Earn up to 4.30% Annual Percentage Yield (APY) on SoFi Savings with a 0.70% APY Boost (added to the 3.60% APY as of 11/12/25) for up to 6 months. Open a new SoFi Checking and Savings account and pay the $10 SoFi Plus subscription every 30 days OR receive eligible direct deposits OR qualifying deposits of $5,000 every 31 days by 1/31/26. Rates variable, subject to change. Terms apply at <a href="https://www.sofi.com/banking/#2">sofi.com/banking#2</a>. SoFi Bank, N.A. Member FDIC.</p>
No account, overdraft, or monthly fees3 <p>We do not charge any account, service or maintenance fees for SoFi Checking and Savings. We do charge a transaction fee to process each outgoing wire transfer. SoFi does not charge a fee for incoming wire transfers, however the sending bank may charge a fee. Our fee policy is subject to change at any time. See the SoFi Checking & Savings Fee Sheet for details at <a href="http://sofi.com/legal/banking-fees/">sofi.com/legal/banking-fees/</a></p>
Get your paycheck up to two days early with direct deposit4 <p>Early access to direct deposit funds is based on the timing in which we receive notice of impending payment from the Federal Reserve, which is typically up to two days before the scheduled payment date, but may vary.</p>
Access additional FDIC insurance up to $3 million5 <p><b style="font-family: Rubik, -apple-system, BlinkMacSystemFont, "Segoe UI", Roboto, "Helvetica Neue", Arial, sans-serif;">SoFi Bank is a member FDIC and does not provide more than $250,000 of FDIC insurance per depositor per legal category of account ownership, as described in the FDIC’s regulations. Any additional FDIC insurance is provided by the SoFi Insured Deposit Program. Deposits may be insured up to $3M through participation in the program. See full terms at <a href="http://sofi.com/banking/fdic/sidpterms">SoFi.com/banking/fdic/sidpterms</a>. See list of participating banks at <a href="http://sofi.com/banking/fdic/participatingbanks">SoFi.com/banking/fdic/participatingbanks</a>.</b></p>
A neobank is typically a fintech company that offers financial services you might expect from a traditional bank. These could include checking accounts, savings accounts, credit cards, and more.
Neobanks are sometimes referred to as "challenger banks" because they challenge the traditional banking industry. In some cases, traditional banks such as Chase and Citibank can trace their histories back for centuries. But neobanks are often startup companies that haven't been around for many years and don't tend to have in-person locations.
Rather, these digital banks gravitate toward offering online-only services, typically through web browsers and mobile apps. In comparison, many traditional financial institutions offer a hybrid business model with both in-person and online services. This hybrid model might seem more beneficial at first glance because it can appeal to a wide variety of individuals, but having in-person branches can also come with big overhead fees.
Neobanks typically don't have many of the costs associated with in-person lenders, such as upkeep and maintenance costs, as well as hiring employees. Given this, the appeal of these new challenger banks is the offer of better rates, lower fees, and more convenience. In addition, focusing on online services could help these digital banks resonate with tech-savvy millennials and Gen-Zers.
What are some examples of neobanks?
Although you may not think you know of any neobanks, it's possible you might have heard of a few. Many of the most popular neobanks, such as Current, GreenFi, and Varo, have millions of customers. Surprisingly, none of these companies are even 10 years old, which goes to show how successful and disruptive neobanks can be in a short period of time.
Here are some of the top neobanks:
Current
Current was founded in 2015 and offers banking services in partnership with Choice Financial Group and Metropolitan Commercial Bank. Current offers a personal checking account and debit card that can be accessed through its mobile app on iOS or Android devices.
Current offers loads of perks and benefits, including getting your direct deposit up to two days early and the opportunity to open teen checking accounts. Your deposits are FDIC-insured up to $250,000, and you also have minimal fees, such as fee-free overdrafts on up to $100, no minimum balance fees, no bank transfer fees, and fee-free ATM withdrawals from more than 40,000 ATMs in the Allpoint network. In addition, your debit card offers cash back from more than 14,000 participating merchants.
GreenFi was founded in 2013 and offers multiple financial services in partnership with banks like Coastal Community Bank and Beneficial State Bank. Cash deposits are FDIC-insured through partner banks.
This company's flagship product, called the GreenFi Spend & Save Account, is a combination of two different accounts that form one cash management product. However, it's possible to open an GreenFi Save Account, which is similar to a savings account, without opening an GreenFi Spend Account, which is similar to a checking account.
GreenFi also plans to offer the GreenFi Zero, a credit card that rewards you with cash back for going carbon neutral. This aligns with GreenFi's general theme of protecting and preserving the climate. GreenFi services are available on its website and mobile app, which is available on iOS and Android devices.
Varo is slightly different from other neobanks on this list because it's an actual bank and not a fintech company that partners with banks. However, that doesn't mean it follows the vein of traditional banks. Varo focuses on online banking through its website and mobile app — available on iOS and Android devices — rather than brick-and-mortar locations.
Varo offers an online checking account that comes with a debit card and doesn't have monthly fees or a minimum balance. There are also no foreign transaction fees, transfer fees, or ATM fees at more than 55,000 Allpoint ATMs. Other benefits include early direct deposit, contactless payments, FDIC-insured bank deposits of up to $250,000.
Does it make sense to consider opening an account with a neobank? Here are some neobank benefits that could sway your decision:
Low fees: With low overhead costs due to the lack of physical branches, neobanks can typically afford to charge fewer fees for their services. This is in contrast to traditional banks that are known for charging a wide range of fees.
Competitive interest rates: In addition to low or no fees, neobanks might often offer more competitive rates than traditional banks. For example, the national rate for savings accounts is currently 0.40% (as of 11/17/25), but an GreenFi Save Account offers up to 1.00% (as of 10/02/25) annual percentage yield (APY) on the first $10,000 in your account. If you're interested in how this APY stacks up, check out our list of the best savings accounts.6 <p class="">The product and annual percentage yield (APY) data displayed on this website is gathered from various sources and may not reflect all of the offers available in your area. Although we strive to provide the most accurate data possible, we cannot guarantee its accuracy. Always verify account details and availability with the financial institution before opening an account.<br></p>
Convenience: Neobanks focus on providing services that can be accessed from anywhere, including your phone and other devices. Mobile apps are popular ways to access neobank accounts.
Focused services: Most neobanks don't offer a wide range of services, which means the services they do offer are typically more refined. For example, Current offers only a checking account, but it comes with loads of benefits, such as cashback earning potential and no hidden fees.
Cons of neobanks
Neobanks might not be for everyone. Here are a few drawbacks to look out for:
Not a bank: Most of the time, neobanks aren't actual banking institutions. This means they have to partner with banks to provide services, including bank accounts that offer FDIC insurance. This can feel a bit confusing for some people, especially if you're used to being a customer at traditional banks.
No physical locations: Most neobanks don't have physical locations. This isn't an issue for many people, but it could be frustrating if you like doing your banking business in person or getting in-person customer support.
Fewer services: Neobanks are typically focused on a few, select digital banking services, which is often different from most traditional banks. You expect traditional banks to offer a wide variety of financial products and services, including loans, bank accounts, credit cards, and more. But with a neobank, you might get only a few choices.
5.0
FinanceBuzz writers and editors score products and companies on a number of objective features as well as our expert editorial assessment.
Our partners do not influence our ratings.
2025 award winnerBest Checking and Savings Combo
SoFi Checking & Savings - Earn Up to $300 When You Set Up Direct Deposit
Limited-Time Offer: Earn a $50 or $300 bonus and up to 4.30% APY on Savings (3.60% APY1 <p>New and existing Checking and Savings members who have not previously enrolled in Direct Deposit with SoFi are eligible to earn a cash bonus of either $50 (with at least $1,000 total Eligible Direct Deposits received during the Direct Deposit Bonus Period) OR $300 (with at least $5,000 total Eligible Direct Deposits received during the Direct Deposit Bonus Period). Cash bonus will be based on the total amount of Eligible Direct Deposit. If you have satisfied the Eligible Direct Deposit requirements but have not received a cash bonus in your Checking account, please contact us at 855-456-7634 with the details of your Eligible Direct Deposit. Direct Deposit Promotion begins on 12/7/2023 and will be available through 1/31/2026. Full terms at sofi.com/banking. SoFi Checking and Savings is offered through SoFi Bank, N.A., Member FDIC.</p><p>SoFi members with Eligible Direct Deposit can earn 3.60% annual percentage yield (APY) on savings balances (including Vaults) and 0.50% APY on checking balances. There is no minimum Eligible Direct Deposit amount required to qualify for the 3.60% APY for savings (including Vaults). Members without Eligible Direct Deposit will earn 1.00% APY on savings balances (including Vaults) and 0.50% APY on checking balances. Interest rates are variable and subject to change at any time. These rates are current as of 11/12/25. There is no minimum balance requirement. Fees may reduce earnings. Additional information can be found at<a href="http://www.sofi.com/legal/banking-rate-sheet" >http://www.sofi.com/legal/banking-rate-sheet</a>.</p> with +0.70% APY Boost) for 6 Months on new accounts with eligible direct deposit. Terms Apply.2 <p>Earn up to 4.30% Annual Percentage Yield (APY) on SoFi Savings with a 0.70% APY Boost (added to the 3.60% APY as of 11/12/25) for up to 6 months. Open a new SoFi Checking and Savings account and pay the $10 SoFi Plus subscription every 30 days OR receive eligible direct deposits OR qualifying deposits of $5,000 every 31 days by 1/31/26. Rates variable, subject to change. Terms apply at <a href="https://www.sofi.com/banking/#2">sofi.com/banking#2</a>. SoFi Bank, N.A. Member FDIC.</p> FDIC Insured.5 <p><b style="font-family: Rubik, -apple-system, BlinkMacSystemFont, "Segoe UI", Roboto, "Helvetica Neue", Arial, sans-serif;">SoFi Bank is a member FDIC and does not provide more than $250,000 of FDIC insurance per depositor per legal category of account ownership, as described in the FDIC’s regulations. Any additional FDIC insurance is provided by the SoFi Insured Deposit Program. Deposits may be insured up to $3M through participation in the program. See full terms at <a href="http://sofi.com/banking/fdic/sidpterms">SoFi.com/banking/fdic/sidpterms</a>. See list of participating banks at <a href="http://sofi.com/banking/fdic/participatingbanks">SoFi.com/banking/fdic/participatingbanks</a>.</b></p>
FinanceBuzz writers and editors score products and companies on a number of objective features as well as our expert editorial assessment.
Our partners do not influence our ratings.
Use Cash App As Your All-in-One Financial Services Platform
Bank7 <p>Cash App is a financial services platform, not a bank. Banking services provided by Cash App’s bank partner(s). Savings provided by Cash App, a Block, Inc. brand.</p><p class="">Cash App is a financial services platform, not a bank. Banking services provided by Cash App’s bank partner(s). Direct Deposit provided by Cash App, a Block, Inc. brand.</p> without all the fees—save, send, and spend your money the way you want.8 <p class="">Your balance is eligible for FDIC pass-through insurance through our Program Banks Wells Fargo Bank, N.A. and/or Sutton Bank, Members FDIC for up to $250,000 per customer when aggregated with all other deposits held in the same legal capacity at each Program Bank above, if certain conditions are met. Cash App is a financial services platform, and not an FDIC-insured bank. Prepaid debit cards issued by Sutton Bank, Member FDIC. See <a href="https://cash.app/legal/us/en-us/card-agreement">terms and conditions</a>. </p> Get paid up to 2 days early – up to 2 days earlier than most banks9 <p>Your first deposit may take longer depending on your employer.</p>
Neobanks are legitimate fintech companies that typically provide services you might see offered from a traditional bank, such as checking accounts or savings accounts. However, a neobank, despite its name, is not usually an actual bank. Generally, neobanks have partner banks that provide these services and offer consumers protection, such as FDIC insurance on certain accounts.
What's the best neobank?
The best neobank is the one that provides financial services that align with your goals and lifestyle. With many popular neobanks to choose from, such as Current, GreenFi, and Varo, it shouldn't be hard to find one that makes sense for your financial situation.
If comparing neobanks, consider the different services they offer and what unique benefits they might have. For example, you might want faster direct deposit times, which one neobank may provide, whereas another doesn't.
Is a neobank the same as a fintech company?
The terms neobank and fintech can often be used interchangeably when referring to non-bank companies that offer banking products, but not always. Neobanks are a type or category of fintech. However, not all fintechs are neobanks. Fintechs can also be companies that offer payment services or platforms, lending, investing, and more. For a fintech to be considered a neobank, it must provide banking products and/or services.
Bottom line
Neobanks are trending, but it's a trend that's not likely to disappear. With millions of customers in a short span of years, neobanks are filling in the gaps where traditional banks have typically faltered — specifically with accessibility issues and unreasonable fees — and people are taking note.
However, this doesn't mean a neobank would be the right fit for everyone. You might prefer going to your local bank or credit union branch and chatting with a banker in place of an online bank or navigating an app on your phone. For some, the convenience of technology isn't convenient at all. But if you're not averse to technology and don't have anything concrete tying you to traditional banks, going with a neobank could be right for your personal finance needs.
For more details, check out our list of the best banks, which includes multiple neobanking options.
FinanceBuzz writers and editors score products and companies on a number of objective features as well as our expert editorial assessment.
Our partners do not influence our ratings.
2025 award winnerBest Checking and Savings Combo
High APY of up to 4.30% on Savings (3.60% APY1 <p>New and existing Checking and Savings members who have not previously enrolled in Direct Deposit with SoFi are eligible to earn a cash bonus of either $50 (with at least $1,000 total Eligible Direct Deposits received during the Direct Deposit Bonus Period) OR $300 (with at least $5,000 total Eligible Direct Deposits received during the Direct Deposit Bonus Period). Cash bonus will be based on the total amount of Eligible Direct Deposit. If you have satisfied the Eligible Direct Deposit requirements but have not received a cash bonus in your Checking account, please contact us at 855-456-7634 with the details of your Eligible Direct Deposit. Direct Deposit Promotion begins on 12/7/2023 and will be available through 1/31/2026. Full terms at sofi.com/banking. SoFi Checking and Savings is offered through SoFi Bank, N.A., Member FDIC.</p><p>SoFi members with Eligible Direct Deposit can earn 3.60% annual percentage yield (APY) on savings balances (including Vaults) and 0.50% APY on checking balances. There is no minimum Eligible Direct Deposit amount required to qualify for the 3.60% APY for savings (including Vaults). Members without Eligible Direct Deposit will earn 1.00% APY on savings balances (including Vaults) and 0.50% APY on checking balances. Interest rates are variable and subject to change at any time. These rates are current as of 11/12/25. There is no minimum balance requirement. Fees may reduce earnings. Additional information can be found at<a href="http://www.sofi.com/legal/banking-rate-sheet" >http://www.sofi.com/legal/banking-rate-sheet</a>.</p> with +0.70% APY Boost) for 6 Months on new accounts with eligible direct deposit. Terms Apply.2 <p>Earn up to 4.30% Annual Percentage Yield (APY) on SoFi Savings with a 0.70% APY Boost (added to the 3.60% APY as of 11/12/25) for up to 6 months. Open a new SoFi Checking and Savings account and pay the $10 SoFi Plus subscription every 30 days OR receive eligible direct deposits OR qualifying deposits of $5,000 every 31 days by 1/31/26. Rates variable, subject to change. Terms apply at <a href="https://www.sofi.com/banking/#2">sofi.com/banking#2</a>. SoFi Bank, N.A. Member FDIC.</p>
Paycheck access up to 2 days early with direct deposit4 <p>Early access to direct deposit funds is based on the timing in which we receive notice of impending payment from the Federal Reserve, which is typically up to two days before the scheduled payment date, but may vary.</p>
No monthly maintenance or overdraft fees3 <p>We do not charge any account, service or maintenance fees for SoFi Checking and Savings. We do charge a transaction fee to process each outgoing wire transfer. SoFi does not charge a fee for incoming wire transfers, however the sending bank may charge a fee. Our fee policy is subject to change at any time. See the SoFi Checking & Savings Fee Sheet for details at <a href="http://sofi.com/legal/banking-fees/">sofi.com/legal/banking-fees/</a></p>
Streamlined savings and savings goals with Vaults
Access to a large ATM network10 <p>We’ve partnered with Allpoint to provide you with ATM access at any of the 55,000+ ATMs within the Allpoint network. You will not be charged a fee when using an in-network ATM, however, third-party fees may be incurred when using out-of-network ATMs. SoFi’s ATM policies are subject to change at our discretion at any time.</p>
Advertiser and Editorial Disclosures
Advertiser Disclosure
FinanceBuzz is an independent, advertising-supported website. Some or all of the offers that appear on this page are from third party advertisers from which FinanceBuzz receives compensation. For example, we may receive compensation when you click on a link, when an application is approved, or when an account is opened. This compensation may impact how and where products appear on this site (including, for example, the order in which they appear).
FinanceBuzz does not include all financial or credit offers that might be available to consumers nor do we include all companies or all available products. Information, including rates and fees, is accurate as of the publishing date and has not been provided or endorsed by the advertiser.
The credit card offers that appear on this site are from companies from which FinanceBuzz receives compensation such as banks or CardRatings.com.
Editorial Policy
The FinanceBuzz editorial team strives to provide accurate, in-depth information and reviews to help you, our reader, make financial decisions with confidence. Here's what you can expect from us:
FinanceBuzz makes money when you click the links on our site to some of the products and offers that we mention. These partnerships do not influence our opinions or recommendations.
FinanceBuzz reviews and rates products on a variety of quantitative and qualitative criteria. Whenever possible we test each product and include our honest, firsthand experience using it. Read more about how we rate products.
Partners are not able to review or request changes to our content except for compliance reasons. Financial products are highly regulated so we work closely with partners to make sure the information we have on our site is accurate and includes any required legal language and disclaimers.
We aim to make sure everything on our site is up-to-date and accurate as of the publishing date, but we cannot guarantee we haven't missed something. It's your responsibility to double-check all information before making any financial decision. If you spot something that looks wrong, please let us know.
Thanks for subscribing!
Please check your email to confirm your subscription.
/images/2018/01/23/navina-side-hustle-mid_MPfEDfV.jpg)
/images/2019/12/06/smart_strategies_to_save_money_on_car_insurance.jpg)
/images/2021/09/08/man-banking-on-smartphone.jpeg)
/authors/ben_walker_updated.png)
/authors/jess_ullrich.jpg)
/images/2024/07/31/sofi_logo_-_cropped.png){kind=logo}
/images/2024/07/31/sofi_logo_-_cropped.png){kind=logo}
/images/2025/06/19/cash_app_logo_rO38hx9.png){kind=logo}
/images/2024/07/31/sofi_logo_-_cropped.png){kind=logo}
