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Top digital & app-based bank accounts
How good is your bank's app?
Updated 14 May 2024
Digital and app-based banks come without the branch networks of the traditional banks, but typically offer slicker digital experiences. In this guide we'll run you through our top-pick app-based accounts, plus the ones you've rated the best. Though do take a look at our Best bank accounts guide as well, which includes the top accounts for upfront freebies, ongoing rewards and savings interest.
Who's this guide for? Anyone wanting to try an app-based bank account that can help them manage their cash.
Not what you want? Other related guides...
Best bank accounts | Autosaving apps | Top savings accounts | Prepaid cards
What is an app-based bank?
If you 'do' digital banking, it means you use an app for all, or most, of your banking. In this guide we'll focus on digital and app-based banks (also known as online banks, mobile banks or challenger banks), which have great tech and features that help you know where you're spending, and help you save towards your goals, all within the same app and same account.
We know that some of the traditional high-street banks have popular apps too, and are catching up with their app-only competitors, so we feature the best of these as well.
While the 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. You'll also need an up-to-date smartphone running iOS or Android.
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What can you do on a mobile banking app?
Mobile banking apps are now so whizzy that perhaps the question should be 'what can't you do on a mobile banking app?' Almost all features offered by traditional banks and building societies on their websites have now been incorporated into mobile banking apps. These include the ability to:
- View your account balance and recent transactions
- Transfer money between accounts
- Send money to friends and family
- Set up Direct Debits and regular payments
- Pay bills
- Update your personal information
- Apply for new accounts, loans and credit cards
- Save money in separate 'savings pots'
- Check your credit score
- Immediately 'freeze' a card if it's lost or stolen
- Chat with a customer adviser
Some digital banks also provide better exchange rates than the more traditional bank accounts, and offer fee-free spending and withdrawals overseas, meaning they can be better to use when you're travelling abroad.
Plus, mobile banking apps make it easier to manage contactless payments. The majority allow you to adjust your contactless spending limit (or turn it off completely), and they can simplify the process of linking your card with a digital wallet, such as Google Pay or Apple Pay.
Business account holders can tap into even more features, such as the ability to accept contactless payments with just their smartphone, and automate business expenses.
One feature that mobile banking apps don't offer widely yet is the ability to withdraw cash from a cash machine simply by tapping your phone, but as a number of high-street banks have begun introducing cardless ATMs, this may also be on the horizon for app-based banks.
How do I open an app-only bank account?
To set up an app-only bank account, you generally just need a smartphone (though some do allow you to use a computer if you prefer). And often you can open a new account by following a few simple steps:
- Ensure you meet the eligibility criteria before you start. Usually you need to be over 16, live in the UK, and have valid photo ID, such as a passport or driving licence.
- Download the bank's app by searching in the relevant app store or scanning a QR code.
- Provide some personal details. This will include your full name, address, email address and telephone number. You may also be asked to give details of your salary, citizenship and what you plan to use the account for. Some banks might text or email a code for you to enter at this point too.
- Verify your identity. Do this by uploading a document such as your passport or driving licence. You may also need to upload a selfie or make a short video so the bank can double-check you are who you say you are.
- Activate your card. If you've applied for a current account, the bank will send you a debit card that's linked to your new account once you've finished signing up. Follow the instructions that the bank gives you to get your card up and running.
Some banks offer different account types – savings-only accounts, packaged accounts and business accounts, for example – so be sure to check you're signing up for the one that suits your needs best. For more information and to compare options, see top app-based bank accounts below and also check out our various banking guides.
The five app-based banking need-to-knows
To get your head around app-based banking, it helps to know the following:
What sort of budgeting tools do app-based banks offer?
Budgeting doesn't come easily to everyone, and to help, many mobile banking apps have introduced budgeting features. These allow you to keep track of your spending without having to use a separate budgeting app or update a spreadsheet. Here are some of the budgeting tools that app-based banks offer:
- Savings pots. Like a digital piggybank, a 'pot' is a place in your account where you can stash some of the money from your current account to keep it separate from your main balance. Some banks even allow you to hide or lock your pots in case you're tempted to dip into them.
- Round-ups. A great way to save small amounts regularly without much effort, this budgeting feature rounds up your card payments to the nearest pound and automatically transfers the spare change into your designated pot.
- Spending alerts. These give instant notifications when you spend, which can help the more tap-happy among us to think twice about a purchase, especially if the account is shared with someone else who will also receive an alert.
- Spending insights. This feature shines a spotlight on your spending habits more generally. You'll be able to see how much money you spend in particular shops each month, or simply which category uses up most of your cash.
- Spending caps. Once you've used the spending insights feature, you might find it helpful to set yourself a spending cap to limit the amount you can spend on certain things.
If you're looking for a budgeting app solely for the savings pot feature, check out our guide to automatic savings apps – these automatically move money from your bank account to a virtual savings account.
Lastly, do remember that while these budgeting tools are useful for encouraging mindful spending and saving, they're not a substitute for really considering your finances and setting yourself a proper budget. And if you're struggling with debt, do have a look at our Debt help guide.
Top app-based bank accounts
To get a current account with one of the challenger banks below, you apply through their apps – the process is quick and easy, typically taking just a few minutes if you're accepted.
Do note these accounts can be beaten if you're looking for £150+ to switch or monthly cashback. But if you're after a high-tech account, these are our top picks. We've also included MSE users' app ratings from our most recent banking apps poll.
Starling: Useful spending notifications, great for budgeting + top for overseas use. Starling Bank gives real-time notifications when you use your debit card, plus spending insights, and lets you set up savings goals. You earn 3.25% in-credit interest on up to £5,000 – a decent rate, but it can be beaten.
Starling offers a 'round-up' feature, which rounds all purchases up to the nearest £1 and autosaves the difference. It's also a top-pick debit card to use abroad, as it's fee-free for overseas spending and cash withdrawals. |
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Overseas fees: None In-credit interest (AER variable): 3.25% up to £5,000 How to pay in? Cash at any post office, cheques via app/post Unarranged overdraft cost: None |
Chase: 1% cashback for at least a year on most purchases, plus no fees to spend/withdraw cash abroad. The app-only Chase current account* gives a top rate of cashback on most spending (max £15/month), though there are some exclusions. There's no minimum pay-in required in the first year, but you'll have to pay in £1,500+/month after that to continue getting cashback. To use Chase, you'll need a device with at least iOS 14.1 or Android 8.1.
You can also set up its 'round-up' feature, which rounds all purchases up to the nearest £1, with the difference autosaved into a separate account paying 5% (for example, spend £1.45 and 55p is transferred). You can create up to 20 extra accounts, and there's also a monthly spending overview – great for helping to manage your money. |
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Service rating: 95% 'great' |
Overseas fees: None In-credit interest (AER variable): 3.85% on £1m via its linked savings account & 5% on small amounts saved in the round-up account Unarranged overdraft cost: Not available |
Monzo: Helps you budget & also offers savings accounts with partner banks. Monzo* has similar features to Starling – real-time spending notifications and insights into where you're spending. It's also good for overseas use, particularly if you won't withdraw cash or will only get small amounts.
The difference comes with savings – Monzo has its own instant-access savings 'pot', but also lets you set up 'pots' with its partner banks too, which often pay higher interest rates – though top-pick savings usually pay even more. Monzo also has a 'round-up' feature, which rounds all purchases up to the nearest £1 and autosaves the difference in a 'pot' of your choice.
Monzo also offers three tiers of paid accounts: Extra (£3/mth), Perks (£7/mth) and Max (£17/mth). Each tier comes with additional benefits including connecting your accounts via open banking (Extra), free Greggs coffee (Perks) and travel insurance (Max). Full details of each package can be found on Monzo's website. |
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Service rating: 88% 'great' |
Overseas fees: None on spending, ATM withdrawals are only fee-free in the UK and in European Economic Area (EEA) countries up to £400 per 30-day period, 3% fee after (i) In-credit interest (AER variable): 4.1% via its linked instant-access savings account Unarranged overdraft cost: As above if applicable, or 39% (max £15.50/month) |
| Revolut: Good for anyone who travels a lot. In addition to common banking app features such as real-time spending notifications and insights, the Revolut* standard plan has advantages for those who regularly spend overseas. Revolut customers can hold up to 30 currencies at a time, with no exchange fees on weekdays. Account holders can also send money in over 70 currencies to more than 160 countries. | |
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Overseas fees: None Monday to Friday, 1% fee on weekends and/or for Thai baht. 1% fee if exchanging £1,000+/month In-credit interest (AER variable): 2.29% How to pay in? Cash at any participating retailer Arranged overdraft cost (EAR variable): Not available Unarranged overdraft cost: Not available Get the app: iOS (rated 4.9/5) or Android (rated 4.5/5) MSE users' app rating: N/A |
(i) In the UK and EEA countries, ATM withdrawals are fee-free up to £400 per 30-day period, 3% fee above. Though if you use Monzo as your main account (pay in £500+ per month and have one or more Direct Debits), then it's always fee-free in these countries. Outside of these countries, it's only fee-free up to £200 per 30-day period, 3% fee above. See full info. Our service ratings are from our January 2024 poll of 4,200 people.
Top-rated traditional banks' apps
You may want a slick app, but from a banking name you know. We 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 apps from the traditional banks.
For now, neither of these apps offers the same budgeting help as the newer players, but they're decent options if you want to stick with a name you know and you normally do a lot of mobile banking.
- NatWest – 71% rated it 'great' for usability; 66% 'great' for features.
The NatWest app rates the best of the apps from the traditional banks. Our pick of NatWest accounts is its Rewards Account, which gives users £3/month cashback (it's £5/month but with a £2 monthly fee) every month they use the mobile app and pay out two £2+ Direct Debits. However, you'll need to be able to pay in £1,250+/month to hold the account.
The app will let you check your balance, see transactions and manage payees and recurring payments. Plus you can request money from friends with a QR code/link and easily split a bill. Download the app for iOS (rated 4.6/5) or Android (rated 4.5/5).
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- Lloyds – 68% rated it 'great' for usability; 60% 'great' for features.
The Lloyds app is also well-rated by MoneySavers for both features and usability. Our pick of accounts here is Club Lloyds, which pays interest of up to 1.5% when you have up to £5,000 in the account. However, you'll need to be able to pay in £1,500+/month, or you'll be charged a £3 monthly fee to keep the account. You can also qualify for rewards, including cinema tickets, movie rentals or magazine subscriptions.
The Lloyds app gives you instant spending notifications, lets you see transactions on a map and helps you manage monthly subscriptions. Download it for iOS (rated 4.8/5) or Android (rated 4.6/5).
What can other traditional banks' apps do?
In addition, we wanted to know what other banks are doing in terms of offering budgeting help, letting you freeze your card and other app features. This table summarises what they offer...
App features by bank
| Provider | Freeze debit card in-app? | Instant spending notifications? | Spending categories? | Turn off certain spending? | Any other features? |
| Bank of Scotland | Yes | Yes | Yes | Yes | See list |
| Barclays | Yes | Yes | Yes | Yes | See list |
| Co-op | No | No | No | No | - |
| First Direct | Yes | No | Yes | Yes | - |
| Halifax | Yes | Yes | Yes | Yes | See list |
| HSBC | Yes | Yes | No | Gambling block | See list |
| Lloyds | Yes | Yes | Yes | Yes | See list |
| Metro Bank | Yes | Yes | Yes | No | See list |
| Nationwide | Yes | No | No | No | Savings goals |
| NatWest | Yes | Yes | Yes | Restrict online/phone use |
Savings goals |
| RBS | Yes | No | Yes | Restrict online/phone use | Savings goals |
| Santander | Yes | No | No | Yes | View card PIN in-app |
| Starling | Yes | Yes | Yes | Yes | See list |
| TSB | Yes | No | No | No | Savings pots |
| Virgin Money | No | Yes | Yes | No | Budgeting help |
| Last updated: September 2022. | |||||
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