Banks are pretty hip when it comes to mobile technology. Using your smart phone, a click on a banking app lets you transfer money and deposit checks. But virtual banks aim to do it better. One such financial institution is GoBank, which launched in 2013. It has no branches and doesn’t provide many typical banking services, such as loans. It offers a slick mobile checking account interface and no monthly fees—if you opt for that.
The primary purpose of a checking account is to accept and securely hold your liquid cash assets for later convenient disbursement to pay bills and serve your day-to-day cash spending needs through cash withdrawals.
We evaluated the five key criteria listed on the Quick-take scorecard below, using a 1-to-5 scale, where 5 represents the best score and 1 indicates the worst. Those five major-category scores were based on our more detailed assessment of 15 underlying performance attributes, detailed below.
Quick-take scorecard
Major criteria of comparison
GoBank
Chase Mobile
1 Depositing money
3.3
5.0
2 Withdrawals & payments
4.7
3.7
3 Fees & penalties
4.5
4.0
4 Real-time account information
2.0
5.0
5 Safety, consumer protections, and security
3.7
5.0
Overall average score
3.6
4.5
GoBank proclaims to offer a great alternative: the option of no fees and basic checking services through a mobile device. Yet its banking app is not equal to the one run by Chase. Plus checks take too long to clear—a major drawback. At Chase you may end up paying fees, but you can easily avoid them. And it’s nice to know that if there’s ever a problem, you can go to the bank and speak to someone in person, which is an option we think is still very worthwhile. Here's our detailed expert review. —Jeff Blyskal Behind the numbers
Each key product feature listed below is scored on a 1 to 5 scale, where 5 indicates the best available value to consumers and 1 equals the worst. Our expert reviewer used one or more of the various assessment tools available including field tests using both products, checking availability of features, and reporting information provided by both companies.
Performance attribute
GoBank
Chase Mobile
Direct deposit of paycheck
5.0
5.0
Check deposit via smart phone
1.0
5.0
Check deposit via ATM
2.0
5.0
Cash deposit
5.0
5.0
Category average
3.3
5.0
The ability to easily and conveniently put money into your account is essential to having assets on hand for paying bills and withdrawing cash as needed.
This proved to be a problem for our assessment of GoBank in the area of depositing paper personal checks into our account. As a so-called virtual bank, GoBank has no physical branches, so we couldn't deposit checks that way. Its free ATM network doesn't accept deposits, either.
That left us to deposit checks using our smart phone camera, which is a fine alternative offered by GoBank and Chase. But for GoBank, "most personal checks will take 10 business days" to clear, a spokesman said. That means your money is held hostage for much longer than traditional bank customers expect, an outrageous step backward for consumers and totally unacceptable in today's digital banking world. By contrast, Chase released funds the same business day as deposit.
Both banks also offered direct deposit, an essential method of electronically depositing paychecks, Social Security benefits, and other income.
Cash was deposited into the Chase account via ATM; with GoBank, we found a conveniently situated 7-11 store (cash deposits can also be made at Walmart) and handed the long green to a clerk, who swiped our GoBank ATM card in a manner that he likened to loading cash onto a prepaid debit card. Neither bank charged fees for any of the deposit transactions we evaluated.
For more detail, which you can use to compare other mobile and virtual banking options that you may be considering, see "How we scored them" below.
Performance attribute
GoBank
Chase Mobile
Free ATM network size
4.0
2.0
Electronic bill payment
5.0
5.0
Person-to-person (PTP) electronic payment
5.0
4.0
Category average
4.7
3.7
Conveniently getting your money out of your account is just as important as ease of depositing funds. A debit card is standard with both accounts, which goes a long way in providing access to funds via point-of-sale payments to any merchant that accepts MasterCard or Visa.
Cash withdrawals were another story. GoBank has about 42,000 nationwide fee-free ATMs at many retailers; we used an ATM at a CVS pharmacy. In contrast, Chase, the nation's largest bank, only has about 20,000 no-fee ATMs in 23 states.
GoBank also nosed out Chase on person-to-person, or P2P, electronic payments, which is a way to send money to a friend via e-mail and without having to write a paper check or send it via the U.S. Postal Service. When we tested this, the GoBank P2P funds were available in the receiving account via PayPal almost immediately. Chase's Quickpay was a bit slower, with funds available the next day, though a spokeswoman said P2P transfers under $500 to someone else who also has a Chase account are available the same day.
Both banks also provide the ability to pay bills electronically, which was easy to use and free in our tests at GoBank and Chase.
Performance attribute
GoBank
Chase Mobile
Monthly account fee
5.0
5.0
Overdraft fee
5.0
1.0
Deposit fees
5.0
5.0
Other sneaky fees
3.0
5.0
Category average
4.5
4.0
Consumers hate bank fees, but it costs money to deliver the services that banks provide. We believe fees should be fair and transparent.
When we had our account, in March and April 2014, GoBank gave customers the option of paying whatever monthly fee they wished, from $0 to $9, though it used the cute pooch in the photo above to charm customers into paying more than zero; the digital doggy perked up more and more the higher the monthly fee you agreed to. (We chose zero.) Chase was more bankerly: It charges a $10 to $12 monthly fee, depending on the state you live in, but that’s easily waived if you have direct deposit—which everyone should have.
Chase lost big points for its big overdraft fee—$34 per item—but it will waive that fee if you cover the overdraft that same day. GoBank got dinged for charging us a $1 fee on four occasions for balance inquiries at one of its "free" ATMs. That was an unfortunate error, customer service and a company spokesman assured us—and that turned out to be true. But customer service couldn't manually reverse them when we complained, and those funds were unavailable to us until the fees were reversed 11 days later.
Performance attribute
GoBank
Chase Mobile
Real-time available balance
2.0
5.0
Category average
2.0
5.0
You would expect detailed information from a mobile banking app, especially when it’s the bank’s core product. Instead, GoBank’s account information was thin, in some cases not listing details such as for what a fee was levied. More significantly, if we withdrew money over a weekend, the transaction was listed but not reflected in the available balance. The balance was accurate and real time on Monday and on other business days, but consumers live by calendar days and mobile bank balances should be accurate 24/7, the way they were at Chase.
Performance attribute
GoBank
Chase Mobile
FDIC insured
5.0
5.0
Consumer protections
3.0
5.0
Security
3.0
5.0
Category average
3.7
5.0
Both banks are FDIC-insured, but while GoBank complies with consumer protections allowing longer check-hold times for mobile deposits, Chase voluntarily cleared our check sooner.
When we signed up, the GoBank agreement promised that checks would clear within two business days. Instead, ours was held for eight. And, yes, we're still ticked by this, since we first mentioned it in our assessment of deposit money, because so many consumers live paycheck-to-paycheck and can't afford to wait up to two calendar weeks to get their money. (GoBank now discloses up to 10-day holds.)
Chase, on the other hand, does better by the customer than federal regulations would allow and makes the funds available by the second business day.
We assessed both banks on eight indicators of good security, but while Chase demonstrated all eight best practices, GoBank fell short on two. It's advice and guidance to customers about how they should maintain security was thin, and when we logged into GoBank from a new computer that should have set off a red flag at GoBank as an unfamiliar device, the app didn't require more complex authentication from us before letting us get into the account.
Direct deposit of income (paycheck, Social Security, etc.)
5.0
5.0
5
Yes, this service available
4
–
3
–
2
–
1
No, this service not available
Remote capture of a $15 personal paper check via a smart phone camera
1.0
5.0
Funds available:
5
Same business day (BD) as deposited
4
Next BD after deposit
3
Second BD
2
Third BD
1
Fourth or more BD
ATM deposit of a $10 personal paper check
2.0
5.0
5
Deposit accepted, not problematic
4
Deposit accepted, problematic
3
Deposit not accepted, not problematic
2
Deposit not accepted, problematic
1
–
Cash deposit of $20
5.0
5.0
5
Convenient and free
4
Less convenient and free
3
–
2
Convenient with low-cost fee
1
Less convenient and costly fee
Free ATM network size
4.0
2.0
5
56,001 - 70,000 ATMs
4
42,001 - 56,000
3
28,001 - 42,000
2
14,001 - 28,000
1
0 - 14,000
Electronic bill payment
5.0
5.0
5
Easy to use and free
4
Less easy to use and free
3
–
2
Easy to use and low-cost
1
Less easy to use and costly
Person-to-person electronic payment
5.0
4.0
Funds available:
5
Same business day (BD) as sent
4
Next BD after sent
3
Second BD
2
Third BD
1
Fourth or more BD
Monthly account fee paid by us
5.0
5.0
5
$0
4
$0.01 - $5
3
$5.01 - $10
2
$10.01 - $15
1
>$15
Overdraft fee
5.0
1.0
5
$0
4
$0.01 - $10
3
$10.01 - $20
2
$20.01 - $30
1
>$30
Deposit fees
5.0
5.0
5
Never
4
–
3
Under some common circumstances
2
–
1
Always
Other checking fees
3.0
5.0
5
None encountered
4
Minor fee, erroneous, easily corrected
3
Minor fee, erroneous, not-so-easily corrected
2
Minor fee, not erroneous, can't be removed or reduced
1
Minor fees that add up to a lot or major fees, not erroneous, can't be removed or reduced
Provides required consumer protections with minor caveats
3
Provides required consumer protections with major caveats
2
Not required to provide consumer protections but provides voluntary protections
1
Not required to provide consumer protections and doesn't provide voluntary proptections
Security
3.0
5.0
5
Yes on all 8 best practices below
4
Yes on 7
3
Yes on 6
2
Yes on 5
1
Yes on 4 or fewer
Best practices:
1. It's a bank subject to regulatory requirements and examination;
2. It gives customers a good amount of advice and guidance about how to maintain security;
3. It uses 128-bit encryption for cybersecurity of account and other data;
4. The app automatically times out or logs off after a reasonably short period of inactivity;
5. The app locks you out after a small number of failed login attempts;
6. The online banking program detects when you are accessing your account from an unfamiliar computer or a different location and requires more complex authentication before you can log on;
7. Your account information is NOT stored on your smart phone;
