Discover Bank to Offer New Online Checking Account
Discover bank announced the launch of “Discover Cashback Checking” for a limited number of customers. Other consumers should see expect to see the account available in 2014. Discover already offers online savings accounts, CDs, money market accounts and IRAs, but a checking account is the company’s first foray into competition with the likes of Ally Bank and Capital One 360, whose checking products have helped build a loyal following.
Here are the quick facts:
- No monthly fee or minimum balance
- Surcharge-free withdrawals from 23,000 machines within the MoneyPass network
- Mobile check deposit and bill pay
- $0.10 cash back for each debit transaction, bill payment, or check
How will Discover’s new account compare to the best online checking accounts?
Take Ally’s account, for example, which currently earns 0.40% APY on balances up to $15,000. A customer with $5,000 will earn about $1.66 in interest each month, which would require over 16 transactions in a month to achieve with Discover Cashback Checking. Of course, $5,000 or more can be unattainable for many people who may still use their debit card or make bill payments frequently. In that case, Discover’s account looks to be a good option on the horizon.