Ally Bank vs. Barclays: Which Is Better for You?

Online banking is now the main way that Americans handle their money. In a 2024 American Bankers Association survey, roughly three-quarters of U.S. consumers said they do most of their banking online or through mobile devices, while only 8% said they rely on a bank branch.

Due to exceptionally high demand, there are now plenty of online banks with no physical locations. Having an online-only presence allows banks to lower costs and offer higher deposit rates to consumers. Ally Bank and Barclays are two of the top online banks out there, and both offer many benefits for their respective clientele.

If you’re trying to decide between Ally Bank versus Barclays, look here to review all of the key deposit account details and decide which is better for your money.

Ally Bank vs. Barclays: An overview of both online banks

Ally Bank and Barclays are both older banks that switched over to the online market.

Ally Bank started as a division of General Motors (GM). It began by offering auto financing through GM dealers and then moved into other banking services over time. In 2009, the bank decided to close its branches and become an online-only bank — that’s when it changed its name to Ally Bank. Today, Ally Bank is one of the leading online financial institutions and regularly wins awards, including being named among the best online banks of 2024 by DepositAccounts.com.

Even though Ally Bank doesn’t have any branches, it still provides convenient ATM access. You can make free withdrawals from the network of more than 75,000 Allpoint and MoneyPass ATMs nationwide, and Ally Bank refunds up to $10 per statement cycle for charges from using out-of-network ATMs. For help with your bank account, Ally Bank has a live chat option and a 24/7 customer service phone line.

Barclays is a much older bank than Ally, as it launched in 1690 in London. It has since expanded into an international financial institution, known as Barclays Bank, with more than 48 million customers worldwide.

Still, because Barclays is based in the U.K., its American operations aren’t quite as developed. Barclays currently only offers two banking products in the United States: savings accounts and certificates of deposit (CDs). It doesn’t offer loans or any other products.

Barclays also doesn’t provide ATM access. If you want to take money out of your account, you need to either transfer the amount to another bank account or call a customer service line to request a check. Barclays’ customer service line is open from 8 a.m. to 8 p.m. Eastern time seven days a week.

Barclays vs. Ally Bank: Account options

For day-to-day access to your money, Ally Bank is the better choice — it offers a checking account, while Barclays doesn’t. There’s no monthly maintenance fee required for the Ally Bank checking account, and it earns interest on all balances. You’ll also get convenient ATM access, as account holders can use Allpoint and MoneyPass ATMs for free. And if you use an out-of-network ATM, Ally Bank will refund up to $10 per month in charges from ATM owners.

Barclays and Ally Bank both offer an online savings account with a competitive interest rate and no monthly maintenance fee. However, if you’re planning on having higher account balances and you want to earn even more, Barclays also provides a tiered savings account, which features an even higher annual percentage yield (APY).

Both banks also have certificates of deposit (CDs), though Ally Bank has a greater variety of choices. While Barclays provides a decent choice of short- and long-term CDs, ranging from three months up to 60 months, it only offers standard, fixed-rate CDs. Ally, on the other hand, has not only a variety of short- and long-term regular CDs but also two specialty options. The Raise Your Rate CD lets you adjust to a higher payout if market rates increase after you sign up, and the no-penalty CDlets you withdraw your deposit before the maturity date without a fee.

Finally, Ally Bank has a money market account; Barclays doesn’t offer one. Once again, there is no monthly maintenance fee or minimum balance requirement.

Barclays vs. Ally Bank: Rates

*Rates accurate as of Dec. 19, 2024

Barclays doesn’t offer a checking account, but Ally Bank does. Ally Bank’s checking account rates are generous, especially if you have an account balance of at least $15,000. In this case, Ally Bank outearns the national average significantly. If you have a low balance, you’ll still earn interest, but at a rate that’s only slightly above the national average.

For savings accounts, both Barclays and Ally Bank pay an excellent rate, well above the national average. Barclays pays a moderately higher rate than Ally Bank.

For CDs, both Barclays and Ally Bank's rates are much better than the national average. As of December 2024, their rates for 1-year and 5-year CDs were fairly similar. However, if you’re looking for a different time frame, be sure to compare both banks, as Barclays currently pays higher rates for some CD terms and vice versa.

Barclays vs. Ally Bank: Fees

Neither Barclays nor Ally Bank charges a monthly maintenance fee for its deposit accounts, and there’s no minimum balance requirement to avoid a fee. For comparison, the typical bank with physical branches may charge a monthly fee between $12 and $25, and you may be able to waive this fee by maintaining a specific balance. However, the requirements will vary from bank to bank.

Barclays doesn’t include ATM access for its accounts. Ally Bank does, and once again, its fees are impressively low. You can make unlimited free withdrawals from any Allpoint or MoneyPass ATM. And if you use another out-of-network ATM, Ally Bank won’t charge its own fee and will refund up to $10 per statement cycle in ATM owner charges.

As far as overdraft fees, neither bank charges them if you overdraw your account's balance.

Who should bank with Barclays?

• You want the highest possible savings account rate. While Ally Bank pays a generous rate for its savings account, the Barclays savings account rate beats it by a fair amount.
• You don’t need ATM access. The Barclays deposit accounts don’t come with a debit card. To take money out, you’ll either need to request a check or transfer funds over to another bank account that does have ATM access.
• You’re worried about overdraft fees. If you’ve ever overdrawn an account, you understand how expensive this can get. Barclays doesn’t charge an overdraft fee.

Who should bank with Ally Bank?

• You want convenient ATM access. Ally Bank is excellent for ATM access. It allows unlimited, no-cost withdrawals from any Allpoint or MoneyPass ATM, and it refunds up to $10 per statement cycle in charges from out-of-network ATMs.
• You want a full-service bank on top of great deposit rates. Ally Bank offers not only a full range of deposit accounts but also auto loans, home loans, retirement accounts and investments.
• You’d like extra CD variety. Besides regular fixed-term CDs, Ally Bank also has a Raise Your Rate CD and another option that allows penalty-free early withdrawals.

Final word: Is Barclays vs. Ally Bank a better online bank?

Even though Barclays has some attractive benefits, we think Ally Bank looks like the better overall online bank. Ally Bank has more options to choose from, its rates are for the most part as good as Barclays (if not better), and it provides access to a large network of ATMs.

A lack of ATM access is perhaps Barclays' biggest drawback. The only way to take your money out is by scheduling a bank transfer or by requesting a check by mail, which can take a few days. Even though Barclays’ accounts are meant for long-term savings, that delay could be problematic for some customers.

However, there are a few situations where Barclays pays a higher interest rate, particularly when looking at savings and certain CD terms. If your goal is to earn as much interest as possible and you don’t need to make ATM withdrawals, compare the current rates at Barclays versus Ally Bank before deciding.