Online banks are leaving local banks in the dust when it comes to the interest rates offered on savings accounts. Yet many Americans have no idea.
A full 62 percent of people surveyed by WalletHub last year did not realize online-only banks tend to offer higher rates and lower fees. Currently, online banks offer an interest rate that is roughly six times higher, on average, than local banks and credit unions nationwide, according to an analysis by DepositAccounts.com.
Depending on what state you're in, the difference can be even more dramatic. Oklahoma offers the highest average interest on a savings account, with 0.39 percent, according to DepositAccounts. Arkansas brick-and-mortar banks offers the lowest average: 0.13 percent.
Meanwhile, online banks offer an average APY of 1.47 percent as of January 1, 2019, the site's analysis finds. And some offer even higher interest rates. Industry leaders like Marcus by Goldman Sachs offers 2.25 percent APY. Ally pays out 2.2 percent, as does Synchrony. That's about 17 times higher than the Arkansas average.