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Online Banks Dominate Top Savings Interest Rates Available

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For several years now, the average online bank deposit interest rate has been higher than the average traditional brick and mortar bank interest rate. In fact, this month the top 10 deposit rates listed in our database are all offered by online banks. Banks that do not have branches have lower overhead, which is how they can offer higher savings rates and money market rates.

The largest U.S. bank holding companies (by assets) by far offer the lowest rates over regional banks, local banks, and of course, online banks. For example, below is a list of savings rates by the top 4 largest banks.

  • JP Morgan Chase Savings Rate  0.01% APY

  • Bank of America Savings Rate 0.01% APY

  • Citigroup Savings Rate 0.01% APY

  • Wells Fargo Savings Rate 0.03% APY

Savings rates are low these days but the rates offered by the big banks are pathetic. The next set of rates are online savings rates from online banks.

  • My Savings Direct 1.05% APY

  • CIT Bank 1.00% APY

  • iGObanking 1.00% APY

  • GE Capital Bank 0.95% APY

  • Synchrony Bank 0.95% APY

The rates from online banks are about 100 times higher than the big brick and mortar banks. Its a good thing people are a lot more comfortable banking online these days. That wasn't always the case since online banking and online banks are (comparatively speaking) relatively new, having come about in the past 15 years or so.

If you're still not comfortable with online banking, most banks give you the ability to print an account application and submit it and any deposits via regular mail. You can still get a better return on your savings accounts without having to deal with banking online.
Author: Brian McKay
November 7th, 2014