Your browser isn't supported
It looks like you're using an old web browser. To get the most out of the site and to ensure guides display correctly, we suggest upgrading your browser now. Download the latest:

The MoneySaving Forum: join to chat & swap tips with other MoneySavers. Learn how in the Forum Introduction Guide

App-based banking

Top new current account & savings apps incl up to 5% interest

Get Our Free Money Tips Email!

For all the latest deals, guides and loopholes - join the 12m who get it. Don't miss out

Rosie | Edited by Johanna

Updated Monthly

intro image

There's now a wave of banking and savings apps which give you a helping hand with budgeting, saving and managing your cash in a way traditional banks don't. If you're not smartphone-savvy or you prefer banking in a branch, see our Best Bank Accounts guide instead.

What is app-based banking?

Our focus in this guide is on the new app-only banks with all the gizmos such as giving spending notifications and letting you ring-fence cash for savings etc. But some of the traditional high street banks have popular apps, so we also feature them.

Digital banking is on the up – almost 22 million people regularly used a banking app in 2017, according to trade body UK Finance, with 174 app logins every second.

While the purely app-based banks don't have a high-street presence, most have in-app customer support, with dedicated teams on hand to offer assistance if you've any questions or issues.

All apps featured in this guide are free to download – though some have costs associated with running them, which we clearly explain in our best buys below.

Quick questions

Does it matter what kind of smartphone I have?

How do I deposit cash and cheques when using an app?

Rather watch than read? This helpful little video gives you the app-based banking lowdown...

    The seven need-to-knows

    To get your head around app-based banking, read the following:

  • The apps can help with budgeting and tracking spending

  • Your money's not always protected in the same way as a traditional bank

  • The bank accounts are cool and high-tech BUT you can often get better rewards elsewhere

  • They can make saving automatic

  • It's easy if you lose your card or forget your PIN

  • Want a bank account or overdraft? You'll need to pass a credit check

  • Banks now have to let you give authorised apps access to your current account

Top new current account apps

For the challenger banks below offering current accounts, you apply through their apps, and the process is quick and easy, typically taking a couple of minutes.

These accounts can be beaten if you're looking for free cash to switch or high interest, but if you're after snazzy features such as budgeting help and instant notifications, read on for our top picks.

Starling Bank

Useful spending notifications, great for budgeting + top for overseas use

Starling Bank*

App-based Starling Bank* offers a full current account that you can open in a couple of minutes. It gives you real-time notifications when you use your debit card, insights into your spending, and lets you set up savings goals. You also earn a small amount of in-credit interest.

As an added boon, there are no fees for spending or cash withdrawals abroad, making it a top-pick debit card overseas, though it's possible this'll change in future. Starling is regulated by the FCA and has the full £85,000 UK savings safety guarantee.

There are no branches, but you can still deposit cash and cheques – full info in the FAQs below.

Key info
  • Minimum monthly pay-in: None
  • In-credit interest: 0.5% AER variable on up to £2,000, 0.25% between £2,000 and £85,000
  • How to get the app: Download for iOS (rated 4.8/5) or Android (rated 4.2/5)
  • Member of CASS? Yes
  • Does it credit check? Yes
  • Overseas fees: None
FAQs

What else can the app do? As well as providing spending notifications and insights, the app lets you freeze and unfreeze your debit card at the touch of a button, report it lost or stolen or get a PIN reminder in-app. You can also turn off certain functions of your card such as online spending, contactless payments or ATM withdrawals if you want to control a specific type of spending.

Starling also has a 'marketplace', which lets you use other companies' services through its app. There are only a couple of companies featured at the moment, but in future it'll offer ISAs, savings accounts, insurance and mortgages, among other products.

Are there limits on using the card? You can make up to three cash withdrawals a day, totalling a maximum of £300.

What exchange rate will I get overseas? The debit card is a Mastercard, so you'll get the Mastercard rate, which you can check here. There are no fees to use your card abroad, making it a top pick for overseas use.

Will Starling credit-check me? When applying for an account, Starling will run an initial credit check – this is a 'soft' search - which won't affect your creditworthiness. From this, it’ll decide whether it’ll accept you for the account, and how much it could offer you as an overdraft. If (and only if) you say ‘yes’ to the overdraft, Starling will then record a 'hard' credit application on your credit report, which could have a minor impact on your credit score.

Is my money protected? Yes, Starling has full FSCS protection, so your money saved with it is safe up to £85,000.

How do I deposit cash and cheques? To deposit cash, you can do so at any NatWest branch using the following details: Account number: 48588725 Sort code: 600001. It'll appear in your Starling account within 2 working days. If you want to deposit a cheque, you can mail it to 'Starling Operations Team, PO Box 74352, London, EC2P 2QU'. Ensure you include your last name and Starling account number.

How do I contact the bank? If you have any problems or questions, you can contact Starling via the in-app messaging service. Alternatively, you can email: help@starlingbank.com.


Overdraft info
  • Arranged overdraft cost: 15% EAR variable (waived if less than 10p in any month)
  • Unarranged overdraft cost: 15% EAR variable (waived if less than 10p in any month). Max £2/mth.
Monzo

Budgeting help & decent for overseas

Monzo

Monzo Bank has offered one of our top-pick prepaid cards since it launched in 2016, and now it's rolled out a current account.

Like Starling above, it gives real-time notifications when you use your debit card, and insights into your spending. You can also set money aside in 'pots', and choose to round up every purchase you make to the nearest pound, with the difference going into a savings pot.

It has no fees for spending abroad, though overseas ATM withdrawals over a total of £200 in any 30-day period will incur a 3% charge. After the 30 days are up your allowance resets and you can withdraw up to £200 again fee-free.

It's FCA-regulated, and the current account has the full £85,000 UK savings safety guarantee.

There are no branches and you can't deposit cash, though you can deposit cheques by post – full info in the FAQs below.

Key info
  • Minimum monthly pay-in: None
  • In-credit interest: None
  • How to get the app: Download for iOS (rated 4.6/5) or Android (rated 4.3/5)
  • Member of CASS? Yes
  • Does it credit check? ID checks only, unless you apply for an overdraft
  • Overseas fees: No spending fees. Up to £200 fee-free overseas ATM wdls/30-day period, 3% after.
FAQs

What else can the app do? As well as providing spending notifications and insights, the app lets you freeze and unfreeze your debit card at the touch of a button, report it lost or stolen or get a PIN reminder in-app.

You can also set up 'pots', which let you assign money in your account to goals such as saving for a rainy day, or a specific purchase – you can move money back into your current account whenever you want, but be aware that any money you have in a pot won't be included in your main account balance.

Monzo also has a feature called 'Bill Tracker' which alerts you if a regular direct debit leaving your account is higher or lower than usual – helpful if, for example, you've been moved onto a higher energy tariff or racked up a big phone bill without realising.

Are there limits on using the card? You can withdraw up to £400/day from ATMs, up to a maximum of £5,500/mth.

What exchange rate will I get overseas? The debit card is a Mastercard, so you'll get the Mastercard rate, which you can check here.

Will Monzo credit-check me? Yes, if you apply for an overdraft. If you don't apply for an overdraft, it'll just run an ID check on you, which will appear as a 'soft' check on your credit report and won't affect your creditworthiness.

Is my money protected? Yes, Monzo has full FSCS protection, so up to £85,000 is safe when saved with it.

How do I deposit cash and cheques? To deposit a cheque, you must write your account number on the back and send it to 'Freepost Monzo.' You can't pay cash into a Monzo account.

How do I contact the bank? If you have any problems or questions, you can contact Monzo via the in-app messaging service. Alternatively, you can email: help@monzo.com or call 0800 802 1281.

Overdraft info
  • Arranged overdraft cost: £20 buffer then 50p/day
  • Unarranged overdraft cost: £20 buffer then 50p/day (max £15.50/mth)

Top-rated traditional banks' apps

You may want a slick app but from a banking name you know. We recently ran a banking apps poll to ask which apps are best – and while Starling and Monzo (above) came out on top for features and ease of use, the two below were the best-rated big names.

For now, neither of these offers budgeting help or spending notifications (like the other apps in this guide), but they're decent options if you want to stick with a name you know and normally do a lot of internet banking.

  • NatWest – 48% of people in our poll said the app's 'great to use and has lots of features'. NatWest provides several current accounts but its Reward Account is one of our top picks, as for a £2 monthly fee it pays 2% cashback on various bills paid by direct debit.

    The app lets you check your balance and see transactions, set up new payees and make payments. Download for iOS (rated 4.3/5), Android (rated 4.6/5) or Windows Phone (rated 4/5).

  • Barclays – 47% said the app's 'great to use and has lots of features'. As well as letting you check your balance, see transactions and manage payees and recurring payments, the Barclays app lets you temporarily freeze your card and get PIN reminders. Download for iOS (rated 4.8/5), Android (rated 4.4/5) or Windows Phone (rated 4.5/5).

    If you've got the Barclays Bank Account (or Premier) you can also apply for the Barclays Blue Rewards scheme. It's an add-on to Barclays' current accounts which, for a £3 monthly fee, will pay you at least £7/month back.

Top savings apps

As well as current accounts, there are other apps that focus on offering savings products, whether it's top rates for locking your cash away, or using tech to automate your savings. It's important to note that some of them may NOT be FSCS-protected, but we'll let you know if that's the case. Here are our top picks...

Chip logo

Up to 5% interest if you refer friends, automatic saving but not FSCS-protected

Chip*

Normally the Chip app's* savings interest starts at 0%, yet if you refer friends the interest is increased by one percentage point for a year for each person you recommend who starts saving through it, up to a max 5%.

It's a savings app that you connect to your current account. It uses an algorithm to work out how much you can afford to save, moving it automatically into a savings account. You can also choose to manually move money into it up to six times a month. Interest accrues weekly, is paid quarterly, and you can withdraw money whenever you want.

The app works with most of the big banks.

They include:

Important: It stores your money in an 'e-wallet' and DOESN'T have the usual £85,000 per person protection via the FSCS. However, the real risk is if Barclays went bust, which is where your money is held (see FAQs for more).

It's also worth noting that banks could say you're liable for fraud on your account if you've shared your details with apps such as Chip, though it's in the process of becoming FCA-authorised to stop you being liable – see our need-to-know above.

Stats box
  • Interest rate: One percentage point fixed for a year for each friend you refer (max 5%)
  • Interest paid: Quarterly
  • Max savings: £100/day (up to six manual saves a month). £10,000 total
  • How to get the app: Download for iOS (rated 3.7/5) or Android (rated 3.7/5)
  • Protection: Not FSCS-protected, money is ring-fenced (see FAQs)
FAQs

How does it work? You give Chip 'read-only' access to your current account. It analyses your income and spending, then every four to seven days calculates what you can afford to save, and uses a direct debit to move that to a separate 'savings' account, without you noticing. The money normally amounts to about £10-£25 five times monthly; the max is £100 (so £500/mth).

You can also manually move a max £100/day up to six times a month, tell it to save more or less and pause automatic saving.

What if it makes me overdrawn? It'll cover your fees and pay £10 compensation – though you can choose to allow it to take you overdrawn (for example if you had a 0% overdraft).

Is my money safe in Chip savings? Chip isn't a bank. It stores your money in an 'e-wallet' provided by 'e-money provider' Prepaid Financial Services (PFS), which is FCA-regulated. Your money is held in a ring-fenced Barclays account. Under e-money regs, if Chip or PFS went bust your money remains in Barclays together with any interest already paid to you, though you may end up paying insolvency fees (likely small).

In the unlikely event Barclays went bust, your money ISN'T protected by the usual £85,000 FSCS savings safety guarantee, so you'd lose it.

This app currently has no way of making money – the interest comes from its marketing fund. Its aim is to build a customer base then offer users other services it profits from in future, such as overdrafts and credit cards. Of course it may change its savings offering in future too. We've done all the checks we can, but you need to accept there are always unknowns with a new concept such as this, so you might want to consider how much you keep in there.

Plum logo

Automatic saving and free £5 when you first save

Plum*

Plum* works in a similar way to Chip (above), in that it automates your savings. It lives in Facebook Messenger, and uses a smart algorithm to work out how much you can afford to save, moving it automatically into a savings account. Apply via our link and keep your account active (don't pause savings) and you'll get a £5 bonus added to your account within 30 days of Plum making your first automatic save.

Plum doesn't pay interest on money saved, but you can choose to invest through it with a choice of 6 tracker funds managed by Vanguard – though you need to be aware of the risks, and it's not necessarily the cheapest way to invest. See our Investment for beginners guide for more information if you're new to investing.

Important: It stores your money in an 'e-wallet' and DOESN'T have the usual £85,000 per person protection via the FSCS. But the real risk is if Barclays went bust, which is where your money is held (see FAQs for more).

It's also worth noting that banks could say you're liable for fraud on your account if you've shared your details with apps such as Plum, though it's in the process of becoming FCA-authorised to stop you being liable – see our need-to-know above.

Stats box
  • Interest rate: None
  • Max savings: £5,000 per save (no max per day)
  • How to get it: Sign up in Facebook Messenger or online
  • Protection: Not FSCS-protected, money is ring-fenced (see FAQs)
FAQs

How does it work? To sign up to Plum, you need to connect it to your Facebook Messenger. Then you link it to your current account, giving it read-only access so it can see your transactions.

It uses its algorithm to analyse your spending and build a 'unique saver profile' for you, and then – through a direct debit – siphons off a few pounds every three to four days into your Plum savings account. You can tell it to save more or less, or pause automatic saving, and you can also move money into your Plum account manually.

You keep money saved in your Plum account or you can invest it in a choice of 6 tracker funds managed by Vanguard - this comes with a £1 monthly fee, plus 0.15% annual management fee, plus underlying fund fees.

Which providers does Plum work with? Plum currently works with NatWest, RBS, Santander, HSBC, Lloyds, Barclays, First Direct, Halifax, Citibank, Nationwide, TSB, Bank of Scotland, Co-op Bank, Metro Bank, Clydesdale Bank, Think Money, Yorkshire Bank, M&S Bank, Tesco Bank, Ulster Bank, Citibank, Smile Bank, Danske Bank, First Trust Bank, Bank of Ireland and Post Office Bank.

Is my money protected? Plum deposits your money into a 'wallet' operated by MangoPay, an EU-regulated financial institution. Any money saved with Plum is held in a Barclays instant-access savings account. This means that if Plum were to go bust, you'd be able to recover your money from Barclays.

However, if Barclays were to go under, your money may not be FSCS-protected, so you could lose your cash – you need to decide if you're happy to take the risk.

It's also important to note the risks involved if you decide to go down the investing route with Plum: returns aren't guaranteed and you could lose your cash. For more on this, see our Investment for beginners guide.

Top app to invest your spare change

If you're happy to up the risk, in theory it can be possible to earn bigger returns than those currently available from top cash savings or ISAs – and the player below is hoping to weave investing into your day-to-day life. Though always remember that with investing it's possible that you'll lose money, not make it.

Investing's not something you should dive into headfirst if you don't know at least the basics – so take a look at our top 10 investment tips for beginners if you're unsure where to start.

ALWAYS remember the five golden rules of investing:

It's also worth looking at our top picks in our Robo-Funds, Funds, Cheap SIPPS and Stocks & Shares ISA guides for more investment options.

Moneybox logo

Save and invest your spare change

Moneybox

Moneybox launched in 2016 and is an app that lets you invest from as little as £1. You can make weekly or one-off deposits into one of three investment options – cautious, balanced or adventurous. There's also a feature called round-ups, where you connect your debit or credit card to it and it rounds up your purchases to the nearest pound, investing the difference (eg, buy a £2.20 coffee and it takes 80p to invest).

Any savings you make are taken once a week via direct debit and invested a few days later, and you can choose to hold a general account or a stocks & shares ISA. If you've children, there's a separate app if you want to open a junior ISA for them.

Here's what you're investing in:

It's a good option if you want to dip your toe into the world of investing but aren't sure where to start. However, be aware that the charges are relatively high – the app costs £1/mth after the first three months plus 0.45% a year of whatever you invest (and there are also associated fund charges of 0.22% to 0.24% a year, though you'd pay this anywhere) – it can be cheaper to use an investment platform if you're happy to pick your own funds.

Stats box
  • Annual fees: £1/mth per product (free for the first 3mths) + 0.45% a year. Fund manager charges (estimated): 0.22%-0.24% a year.
  • Min investment: £1 | Max investment: £20,000/wk (but £20,000/yr if in an ISA)
  • Transfer-out fee: None, though charges £25 per fund for 'in specie' transfers (where you transfer a fund/holding directly to a new provider without cashing it in first – these are rare)
  • How to get the app: Download for iOS (rated 3.8/5) or Android (rated 4/5)
FAQs

Is my money protected? Moneybox has FSCS protection, so up to £50,000 is safe when saved with it. It's important to know that FSCS investment protection applies if you lose money due to Moneybox going bust, not if the underlying investment goes bust.

In other words, if the funds Moneybox invests in for you perform poorly, you've no protection as that's the nature of investing.

Q&A Digital banking

  • Is internet and mobile banking safe?

  • What about cryptocurrencies such as Bitcoin?

Get Our Free Money Tips Email!

For all the latest deals, guides and loopholes - join the 12m who get it. Don't miss out