Which Banking App Is Best for You?
Consumer Reports compared the apps offered by Albert, Ally, Chime, Current, and Varo with those from traditional banks
When was the last time you walked into a bank branch to do business with a teller? Besides being too busy—who has time to wait in line?—there isn’t much to do at a teller’s window these days. That’s because of how easy it’s become to do most banking chores—depositing checks, transferring funds, paying bills, checking balances—digitally from the comfort of home.
Instead of queueing up for a teller, many consumers prefer managing their accounts online via smartphones and tablets, says Nathan Stovall, director of the financial institutions research team at S&P Global Market Intelligence. So it’s perhaps not surprising that in the past five years, the largest banks have shuttered roughly 1 in 10 branches, according to a February 2024 analysis by the Federal Reserve Bank of Philadelphia.
Indeed, three-quarters of Americans say they use one or more banking apps, according to a February 2023 nationally representative Consumer Reports survey (PDF) of 2,097 U.S. adults. Another CR survey of 2,019 banking app users from the spring of 2023 found that just over three-quarters did so at least once a week and a third did so almost daily.
Considering the shifting trends and widespread popularity of banking apps, CR researchers wanted to find out which ones performed best against CR’s Fair Digital Finance Framework, a way to evaluate digital financial tools in terms of their safety, privacy, transparency, user-centricity, support for financial well-being, and inclusivity. (Read more about those principles as well as CR’s previous evaluations of P2P apps and buy now, pay later services.)
When You Want Fee-Free Checking and Savings
CR experts first looked at whether any of these banking service providers charged a monthly maintenance fee for having a checking or savings account. The good news: Capital One as well as Ally, Chime, Current, and Varo don’t. Albert does require a subscription of $14.99 a month, but it covers a number of useful features including identity protection and customized financial advice. At Bank of America, Chase, U.S. Bank, and Wells Fargo, expect to pay about $5 a month for a basic account, though you may be able to get the fee waived by, for example, maintaining a certain average balance or having monthly direct deposits of a certain amount.
You may also be able to get a better interest rate on a basic savings account at a digital banking provider. Those rates currently range from up to 2 percent at Chime, 4 percent at Current, 4.35 percent at Ally, and 5 percent at Varo. Albert doesn’t promise a specific interest rate. Instead, it says it pays a “monthly bonus” depending on your deposit amount. On the other hand, traditional banks, including Bank of America, Chase, U.S. Bank, and Wells Fargo, pay just 0.01 percent. Capital One, which pays 4.35 percent, does better.
When You Want Help With Budgeting and Saving
Many of these financial institutions have looked for ways to help people improve their financial health by offering a variety of features including automated savings, the ability to split direct deposits into different accounts, tools to help set goals or budgets, and spending trackers.
Nearly every banking app CR researchers reviewed had some of these features, while Albert, Ally, and Bank of America offered all of them. U.S. Bank offers all these features, but its budgeting tool is available only under specific circumstances, such as when customers face cash-flow problems. Chime offers similar tools but only through a separate app that users have to download. (The company says the tools will be integrated into its main app later this year.) Chase says it also offers real-time credit score monitoring.
When You Want to Limit the Sharing of Your Private Information
It’s understandable to want the security of knowing your banking app isn’t sharing your financial data and other private information with others. In fact, 57 percent of people in a December 2023 nationally representative CR survey of 2,027 US adults were at least somewhat concerned when told that banks may share this kind of information without letting them know. Another quarter said they didn’t even know banks did this. More than three-quarters (76 percent) also said it was very important that a bank be required to obtain a person’s permission before sharing their banking data with any other company.
CR’s analysis revealed that most of the banking apps share data with partners for joint marketing purposes—including sending you targeted ads. The data they share goes beyond what’s necessary to provide basic financial services, Hand says. The two exceptions: Albert says it shares only nonidentifiable information, and Varo doesn’t share data with other financial companies for joint marketing.
Of the 10 apps, only five—from Albert, Ally, Chime, Varo, and Wells Fargo—have a way for users to turn off targeted advertising within the app. And only Ally sets up its app so that a user is automatically opted out from receiving targeted advertising. The other five apps don’t have any controls that let users turn off targeted advertising.
It’s one of the most troubling findings of the testing, according to Hand. “These apps should put consumers in the driver’s seat when it comes to determining if they want their personal information to be shared or not,” she says.
When You Need the App to Be Accessible
About 32.2 million adult Americans have significant vision loss or are blind, according to an analysis from the American Foundation for the Blind. And CR’s review found that banking apps lack built-in features for the visually impaired.
Only two—Chime and Ally—let you change the app’s settings so that it can be used in dark mode, where the background is dark and the text is white, to help reduce eye fatigue. All of the apps are compatible with screen reader tools on both Apple and Android phones, which use a speech synthesizer to read aloud text on the app screen. People with visual impairment might have an easier time using the banks’ websites. CR testers found those have built-in accessibility features.
CR testers also reviewed whether the apps were offered in Spanish, which was the case for Bank of America, Capital One, Chase, U.S. Bank, and Wells Fargo. About 42 million people in the U.S. speak Spanish as their first language.
When You Want Continuous Fraud Monitoring and Alerts
One in 3 U.S. banking customers were victims of fraud—including unauthorized credit and debit card usage—in the past 12 months, according to a 2023 J.D. Power survey. Notably, half of those under the age of 40 encountered this problem. Banks that continuously monitor accounts for fraud provide peace of mind to their customers, Hand says.
CR’s analysis found that Albert, Ally, Chase, Chime, Current, and Wells Fargo explicitly commit in their documentation to doing just that: constantly monitoring all actions on bank accounts and flagging those that might be fraudulent. That can entail alerting you to charges, say, from a gas station or convenience store in a state you’re not currently in, and then notifying you first before they authorize the charge. Two others—Bank of America and Capital One—commit to real-time alerts but not explicitly to real-time monitoring. (Capital One told us they have “real-time fraud monitoring tools available across all customer channels” but that information wasn’t listed in their public documentation, Hand says.) U.S. Bank and Varo don’t commit even to real-time alerts.
After CR engaged with the companies, Hand says that Chime and Current committed to more clearly publicizing their real-time monitoring of accounts.
“The only way to assure customers that their funds and information are safe is for companies to make clear what they do to protect them,” she says.
How to Mobile Bank Securely
Once you’ve decided which banking institution and app or website to use on your phone, tablet, or computer, you’ll want to take specific steps to make your home internet network and devices secure from intruders.
Priority 1: passwords and PINs. First, the most important step is to enable a six-digit PIN or face identification on the phone, says Jerry Beilinson, CR’s digital privacy and electronics editor.
Next, use strong passwords—lengthy, complex, and unique—for your WiFi router, mobile phone, or other device, and all online accounts, says Yael Grauer, CR’s digital security expert. CR recommends using a password manager to help with this task, such as 1Password Families and Dashlane Premium.
And if you lose your phone with a banking app on it, alert your bank as soon as possible (as well as your wireless carrier). That way, the bank can put a temporary hold or freeze on your account if needed.
Here are some other suggestions. For even more detailed ways to keep all of your home electronics safe, see CR Security Planner.
On the Banking App or Website
Enable two-factor or multifactor authentication. When you do, you’ll receive a code for one-time use, good for only a few minutes, that you’ll need to complete the log-in process. This helps ensure that the correct mobile device is being used with the banking account or app.
Set the app or website to notify you with a text for every withdrawal or deposit made from or to your account. This may seem annoying if you have a lot of transactions, but it can give you a chance to quickly catch or stop fraudulent or questionable translations.
Phones and Tablets
Keep all apps updated along with your operating system. Do this by making sure to turn on Automatic Updates on your phone. For phone operating system updates on the iPhone, go to General, then Software Updates, and then select Automatic Updates. For Androids, go to Settings, then Software Update, then select Auto Download Over WiFi. For apps used by the phones, both iPhones and Androids, go to Settings, then App Store, then turn on Automatic Updates. That makes sure your devices have the latest security patches.
Your Device’s Security Settings
At a minimum, set your phone or other device to lock after a minute to ensure that no one can quickly access it if you misplace or lose it. Next, on an iPhone or tablet, go to Settings, select each app, and turn off any features it doesn’t need to access in order to function, including the camera, microphone, and location tracking. To do this on Android phones, scroll down to Apps, select each app, and turn off any features it doesn’t need to access in order to function, including the camera, microphone, and location tracking.
Editor’s Note: Consumer Reports’ investigation of banking apps is part of a broader initiative to monitor, evaluate, and strengthen consumer protections in the burgeoning digital finance marketplace. The work is made possible in part by a grant from Flourish Ventures’ donor-advised fund at the Silicon Valley Community Foundation, which supports efforts to reduce systemic inequities.
Clarification: This article was updated on May 29, 2024, to include U.S. Bank among the list of companies that offer online budgeting tools for certain customers.
