A virtual bank is a bank that operates without a physical presence. You can create a virtual bank account using the web or a virtual bank account app without having to visit a bank. In this article, we will list some of the leading providers of a virtual bank account with a debit card and give you an insight into online virtual bank account.
What is a Virtual Bank Account?
A virtual bank account is an account offering banking services electronically. This means that you can access banking services through a virtual online bank account without having to visit a physical bank. When you open a virtual bank account, you get a virtual bank account number.
Are Virtual Banks Secure?
Similar to brick-and-mortar bank, virtual banks are regulated by financial regulatory authorities in countries they operate in and customers’ deposits are insured. Additionally, virtual banks have to meet Payment Card Industry (PCI) compliance requirements to ensure that clients’ data is secured. Virtual banks that are not fully licensed banks operate in partnership with traditional banks to protect account holders’ funds.
How Virtual Bank Works
A virtual bank account is an online bank. To start using one, you will need to first open an online virtual bank account by filling an online application on the bank’s website or its banking app. You will then need to make a deposit to the account. Depending on the bank, some virtual bank accounts come with a personal IBAN number or business IBAN number. Moreover, some banks provide crypto banking services.
How to Make It Work with Virtual Bank Account
Now, more than ever, it is possible to make financial transactions without necessarily visiting the bank. As an alternative, customers visit the banking website or app and complete their financial transactions online, whether on their mobile phones or computers. You can also use a virtual bank account for PayPal verification. As such, virtual banking has been coined as Internet banking, mobile banking or online banking.
How to Deposit Money in Virtual Bank Accounts
The question about how to deposit cash in your virtual account is easy to answer. The traditional way of doing things would be asking your employer to deposit your check directly to your account or visit the bank with cash. Well, did you know that you could also do deposits your check with your virtual bank account? All you have to do is to deposit it using photo check deposit by taking photos of the front and back of the check with your smartphone. Depending on the bank, you can use their website or app for this. For some, however, you will have to mail the check. Other means of depositing money in your virtual bank account include a bank transfer, direct deposit, Apple Pay, Samsung Pay and Google Pay.
How to Withdraw Money from Virtual Bank Accounts
You can withdraw funds the same way you would with traditional banks. Like any other bank, virtual banks also issue debit cards or virtual cards. Therefore, you can withdraw your funds using ATMs. Fortunately, some virtual cards enable you to withdraw money from ATMs. Considering virtual banks do not possess their own ATMs, you will be surprised that the transaction fees are the same, if not lower, than those of ATM card owners of the same bank. This is because most virtual banks do not charge ATM withdrawal fees. Other methods of withdrawing money include wire transfer, check, bill pay feature, and cashback at a store.
How to Open Virtual Bank Account
All it takes for you to open a virtual bank account today is simply to fill out an online application or download the app and register. Most virtual banks would not require you to make deposits immediately but would need to confirm your identity in the long run. As such, they will allow you to make transactions but to a certain limit amount when they ask you to send them your identity card or driving license. However, they do not limit your account or freeze any of your transactions before they request for proof of identity.
Review of International Virtual Bank Accounts
If you would like to open an international virtual bank account, these are some of your options. With these banks, it is easy to open a virtual bank account online. Normally, a virtual checking account will not accrue interest on deposits. Although you will hardly get a global virtual bank account with interest, you can save a lot of costs when you travel abroad.
Wise (Formerly TransferWise)
Wise Multi-currency, formerly TransferWise, is an online bank with IBAN that also offers one of the best money transfer services around the world. Founded in the UK in 2010, the bank allows users to create multi-currency personal and business accounts, send and receive money, and convert currencies. It also offers Wise debit card and Wise virtual card. Its currency exchange service uses mid-market rates, ensuring that you convert currencies using the prevailing market rates.
Report IBAN discrimination: IBAN discrimination is when a bank or company doesn’t accept your IBAN because it’s not from the same country in which the bank or company is based. IBAN discrimination is against the law. If you experience IBAN discrimination, report it.
I came by an opportunity to expand my business to overseas markets with a branch in India. I regularly transfer money over there from Germany and quickly I realized that one of the major banks was either thinking I was stupid or naive. They were charging – between conversion fees and what now I know is called the spread – literally 10% to transfer my money. So, imagine: Germany’s government charging pretty high taxes, and now I will have to pay 10% to a bank just to make sure my people got paid.
So, this is why I love Wise Multi-currency bank account. I cut down the finance charges from 10% to 1%. That is right! I save 10 thousand euros a year thanks to Wise. I highly recommend them. One additional perk is speed too when using Wise money transfer services. Because of the way they have structured their deal with international banks, my money got to India one to 2 weeks faster.
N26 is a German bank offering virtual bank account online with European IBAN in SEPA region and the US. To register on N26 virtual bank, you can use N26 website or N26 app for Android or iOS. You need to make a video call to verify your details.
Following Brexit, N26 bank is no longer available in the United Kingdom.
The bank offers a standard account, a premium account and a business account. The accounts have no hidden fees and come with a physical debit MasterCard and N26 virtual card. For international money transfer, N26 has partnered with Wise to make money transfers cheaper and easier. There is no fee to receive money from anyone. Transferring money in the same currency as your N26 account is free.
N26 bank account in Germany without Schufa
- One of the main challenges you face when opening a bank account in Germany is the Schufa, the German credit score. You can only get the German credit score if you have lived in Germany before or had a German bank account. Thankfully, there are ways around this, for example by opening a bank account in Germany without Schufa with N26 Flex account.
Payoneer is a US virtual bank account that has been on the market since 2005. The bank is available to customers in over 200 countries. It is one of the best alternatives to PayPal for online merchants and freelancers. Account holders get Payoneer debit card and Payoneer virtual card. They can also receive payments in local currency from international companies.
I had never heard of them until recently of course because this is how these things work in a world with hundreds of alternatives for everything. It is amazing to me actually that in order to get a money transfer done, or an international virtual bank account you can be so overwhelmed and underwhelmed at the same time.
When I found Payoneer virtual bank account, I thought they were reasonable and effective at their craft. I have so far no complaints and I hope to stick with them for the long term. Why? I think their offer is quite well adapted to people who make money online like myself. For example, Payoneer allows Amazon sellers to receive funds from Amazon Marketplaces even if you don’t live in those countries.
Bunq is an online bank in the Netherlands founded in 2015, which supports countries in the European Economic Area (EEA). All citizens of the EEA that are residents in the supported countries can sign up for Bunq. Non European citizens residing in one of the supported countries can sign up for Bunq account using the documents described here.
Bunq offers both personal and business accounts. However, for business accounts, your business must be registered in the Netherlands, Germany, France, Italy, Spain, Austria, Belgium or Ireland. Bunq Travel Card is a popular product for frequent travelers. Bunq is a fully licensed bank in the Netherlands, which means clients’ funds are protected by the Dutch Deposit Guarantee up to €100,000.
Bunq German IBAN
- Bunq is the first online bank outside of Germany to offer German IBANs. At the moment, Bunq IBAN for German account holders is available for new account holders with Personal accounts.
Revolut is an online bank launched in 2015, which offers personal and business IBAN bank accounts in EUR, GBP, money transfer and currency exchange services. The accounts come with a MasterCard/Visa debit card and Revolut virtual card.
Revolut’s cryptocurrency transactions are not safeguarded under the UK Electronic Money Regulations 2011 or covered by the Financial Services Compensation Scheme. They are also not regulated by the Financial Conduct Authority (FIC).
Monese is an Estonian bank that offers multi-currency borderless virtual bank account with IBAN and money transfer services to customers in the European Economic Area (EEA). The multi-currency accounts are in GBP, EUR and RON the European Economic Area (EEA).
Monese allows you to open more than one account. Your primary account will be the account you open first. You can open a secondary account in GBP or EUR at no additional cost as well as a joint account. All accounts come with Monese debit MasterCard and Monese virtual card. Its Simple account is a completely free account, ideal for receiving salaries and paying bills.
Bankera is blockchain-based bank from Lithuania. It offers multi-currency accounts, IBAN, SEPA and SWIFT payments to businesses and individuals. In addition, Bankera offers crypto-backed loans without the need for criteria like credit score to issue a loan. Bankera account is available in many countries around the world. Countries where you cannot open Bankera account from include the US, Iran, and North Korea.
Rewire (Bank for Migrants in Europe)
Rewire is an online bank that offers banking and money transfer services online to documented migrants in Europe. Rewire account comes with a European IBAN account and international debit/prepaid Mastercard and a virtual card.
Rewire customers include migrants from Europe, Asia, and Africa. You can send money to several countries using Rewire. Some of the countries are Nigeria, the Philippines, Nepal, Uganda, Ukraine, Kenya, South Africa, India, Sri Lanka, China, Senegal, Thailand, and Ghana.
Virtual Crypto Bank Accounts
There are a number of new banks that offer services for both fiat money and cryptocurrency. Some of the banks leading in the fiat/crypto space are Nuri, formerly Bitwala, Mistertango, Wirex and Fidor Bank.
Virtual Banks in Selected Countries
Virtual Bank Account USA
There are several benefits of having a US virtual bank account for US residents and non-US residents. You can get free virtual bank account without SSN (Social Security Number). Some of the online banks that you can get a virtual bank account in USA include Payoneer, N26 US, TransferWise borderless account, rebranded as Wise multi-currency, and Zenus bank(US virtual bank for global clients). Below you find more examples.
Simple Bank: Considered the first neobank, Simple was an American virtual bank that provided an individual checking account and shared accounts. However, the bank announced in January 2021 that it is shutting down.
The following is a list of other virtual banks USA.
- Chime Bank
- First Boulevard (virtual bank for African Americans)
- Kraken (first ever cryptocurrency company to be awarded a U.S. state banking charter)
- TD virtual banking
- Ally Bank
You can read our full review of virtual bank USA and how to open virtual bank account in USA here.
USA Virtual Bank Account for Non-Residents
- If you are not living in the USA, then you need a US virtual bank account more. Most online programs such as affiliate marketing pay only into an American bank account or charge extra cash to pay into an international account. Web entrepreneurs don’t need to go to the US to get an American virtual bank account, you can create virtual bank account online.
- Virtual bank account for non residents in the US come with debits card and virtual card. You can apply for a virtual bank account with a debit card. There are also many virtual banking services that offer virtual prepaid cards. These prepaid cards can draw funds from Google Adsense, Amazon Payments or PayPal. The card is usually a Visa/MasterCard.
Virtual Bank Account UK
Virtual Bank Account Ireland
Virtual banks have also entered the Irish market. This means you can open a free virtual bank account in Ireland for personal use or business without having to visit a bank. Most virtual banks will offer you a virtual card and a physical debit card. Unfortunately, most virtual banks supporting Ireland do not offer Irish IBAN. However, this should not be a problem. IBAN discrimination is against the law. Read our in-depth review of 6 best virtual banks in Ireland.
What is IBAN discrimination?: IBAN discrimination is when a bank or company doesn’t accept your IBAN because it’s not from the same country in which the bank or company is based. IBAN discrimination is against the law. If you experience IBAN discrimination, you should report it to the Central Bank of Ireland and the CCPC. Make sure you document how the company is infringing on your right to use a foreign IBAN in Ireland (for example with screenshots of your communication with the company).
Virtual Bank Account in Italy
If you are a resident or a non-resident in Italy, you can open a virtual bank account. The Italian law has made it easier to open Italian bank account online. However, it is easier to open one if you reside in Europe. If you are considering opening an online bank account in Italy, you can look at our review of 7 virtual banks in Italy.
N26 best bank in Italy 2021
Virtual Banks in Nigeria
Nigeria is one of the leading fintech hubs in Africa. The fintech ecosystem is thriving with virtual banks offering personal and business accounts, debit cards, loans, virtual dollar cards in Nigeria, etc. This means, all eligible Nigerians can open a Nigerian bank account online without having to visit banking premises. Find out the best digital banks in Nigeria.
Final Thoughts on Virtual Bank Providers
The above virtual banks and others will solve most of the problems people have with traditional banks such as exorbitant fees and paperwork. Virtual banks can also help online entrepreneurs have been facing receiving bank account problems when dealing with American and European companies or verifying services such as PayPal.