How much money to open an online bank?

Been through it as a former board member with a local bank. For a real brick & mortar bank, it's closer to $20 million, but an Internet-based bank with no branches still has to go through the same regulatory process, carry the same types of insurance and bonds, and be on the same geo-redundant networks for transactions, etc. If you'll be lending it's also a lot tougher now than it was five years ago to start one. These days you're better off just buying a struggling bank or credit union and shutting down the branches. The loans they service have already been funded, so as long as their existing income streams exceed the overhead you have the basics covered. But this is one of those types of businesses that if you have to ask how to start on a forum, it's not an area you're likely to have a lot of success with... I don't mean that to sound like an insult or anything, but there are years of education and certifications in the financial sector that you would have to go through to be at the head of a banking business.

What you may want to look into is becoming a licensed money transmitter instead - this is how PayPal operates, and gets away with "not being a bank". You have to obtain this license for every state, but I *think* the required bond is only $500,000. As a licensed money transmitter you can't issue loans or other certain types of bank functions, but you can have "account holders" who transfer money in and out of your system and you can hold it. There are still technical, security, and redundancy compliance considerations and automated reporting (daily IRS dumps for reporting all transfer activity, for example) and those come with their own overhead and operating costs, but not nearly as many restrictions as an actual bank.