There's an interest-rate war going on in the banking industry, and with a little work you can garner the spoils.

Internet-based banks, battling for a share of the market, are offering enticing interest rates -- 5 percent and higher -- on certificates of deposit, money-market accounts and even plain old savings. These e-rates are typically much higher than what you could get at a walk-in branch. Still, they come with some conditions.

	By the Editors of Consumer Reports (www.consumerreports.org).

Before you shop for an online account, take a moment to think about your plans for your money. A CD is a good place to stash cash earmarked for something specific that you'll need around a certain time -- perhaps a home-remodeling project or next year's tuition. If you withdraw the money early, you'll pay a penalty that is fixed by the bank. Bank money-market and savings accounts offer more flexibility but lower floating yields than CDs. (In early October, they were paying 1.35 percent to 1.5 percent less per year than 12-month CDs, on average.) A handful require no minimum deposit to avoid fees, making them good parking spots for emergency funds.

But many online accounts don't offer much beyond higher rates. Most, for example, won't allow you to pay bills electronically. And while many do provide ATM cards, those usually won't double as debit cards. Check writing, too, is limited. To get it, you typically have to link your online account to an existing or new checking account.

For these reasons, it's best to think of an online account as principally an interest generator.

If those limitations work for you, you might want to start your search for an online account at Bankrate.com, a Web site that provides daily updates on rates from 4,800 financial institutions. The site's search engine can sort among banks based on their interest rates and minimum required deposits without additional fees and other variables. Go there once a week for a few weeks to scout out the most competitive institutions.

You should also check with affinity groups. Some offer high-yielding accounts to their members. Teachers, administrators and other professionals who belong to the National Education Association, for example, can put money into the NEA's FDIC-insured money-market accounts, which were recently yielding 5.08 percent for a $500 deposit -- well above the national average of 3.46 percent.

The operative term in online accounts is annual percentage yield, or APY. That's the interest you'll earn. The yield may sometimes include a higher introductory rate, so make sure you know what the regular rate will be before you sign up. Other features to consider include:

Fees. Service fees for money-market and savings accounts can be as high as an eye-popping $25 a month at online banks. You may be able to avoid fees by maintaining a minimum balance.

Direct deposit. Usually, you can have paychecks and Social Security checks deposited into online banks electronically.

With such competitive interest rates, online savings accounts are a good option for anyone with Internet access and a checking account.

Because the setup is fairly straightforward, even folks who nearly empty their accounts every month might find those extra pennies in interest worth the effort.