NEW YORK (MainStreet) — Imagine you have a checking account from Bank of America but choose to withdraw some money through a Chase ATM; this is the beginning of the infuriating scenario most of us have encountered. You're not only facing an ATM surcharge fee from Chase but also required to pay an ATM fee to Bank of America.

Despite the fact that it's a common phenomenon since banks have to find ways to cover the cost of delivering the transactions to their customers, overcharging on banking fees could be an impetus for average consumers to reconsider their choices in deciding which bank they should opt for before opening a bank account.

In fact, that's why personal finance social media platform WalletHub.com recently released a banking report indicating that a personal online account is a better candidate for general consumers seeking the best bank account deal due to its higher interest rates but fewer fees.

According to the report, personal online checking accounts are 23% cheaper than the regular branch accounts. Compared to Bank of America or Chase checking accounts, online checking accounts provide a 94% higher average interest rate and 49% more features such as non-bank ATM fee and reimburse ATM fee. In addition, personal online saving accounts can offer up to 36% higher interest rates than the online checking accounts.

One of the reasons is fewer sunk costs that go into storefronts.

"Online is less expensive for the bank," says John S. Oxford, director of corporate communications at Tupelo, Miss.-based Renasant Bank. "Online accounts don't cost the bank in teller wages, brick-and-mortar locations and call center representatives."

Moreover, he explains that the online bank shopper can look through more options right in front of him at a click compared to driving around and physically studying different checking products.

"So as you can imagine, the online checking marketplace is very competitive, because it's more instant – so the product has to be better," he said.

The financial situation for small business owners is also crucial since business accounts give 76% less on interest rates but require 102% higher fees than personal online checking accounts do, according to WalletHub's report.

As a result, WalletHub's CEO Odysseas Papadimitriou suggests that small business owners set up personal online checking accounts rather than establishing a separate business account.

Still more, Millennials can take a different approach when it comes to picking the right account. For college students, for example, a smart way to manage their day-to-day spending and savings is to use the student checking accounts for daily access for cash and the savings accounts for future capital storage.

The report points out that, compared to the average personal accounts, student checking accounts are 66% cheaper and offer 28% more features. Despite the fact that they also offer lower interest rates, student savings accounts provide some of the highest interest rates on the market.

"As a college student, you may not have a very high interest rate for your type of account, but focus on using technology to help you lower your fees," says Oxford. He also suggests that consumer activities like setting up an online checking account, requesting paperless banking statements, and using mobile deposit for check cashing are a helpful means for banks to reduce their costs; in turn, banks will lower their fees for the customers.

Overdraft fees are a sticking point that consumers too often overlook. Pew Research shows that 52% of consumers didn't realize they opted in for overdraft protection until they faced an overdraft fee upwards of $35 by using their debit cards with insufficient funds to complete the transactions.

Since it's not unavoidable by consumers because they must opt-in for overdraft protection, required by the Credit CARD Act of 2009, Oxford recommends that communicating with your bank and asking for an opt-out is the best way to prevent from being slammed by fees.

— Written by Amy Xie for MainStreet