Discover Online Banking Financial Services, Inc. is an American financial services company that owns and operates by Discover Bank. The Bank offers checking and savings accounts, personal loans, home equity loans, student loans and credit cards. It also owns and operates the Discover and Pulse networks, and owns Diners Club International. Discover Card is the third largest credit card brand in the United States, when measured by cards in force, with nearly 50 million cardholders. It bank headquarter is currently in the Chicago suburb of Riverwoods, Illinois.
Discover Online Banking Features
- They offer savings, checking, money market, CDs.
- Mainly online banking with no physical branches
- A web based, iPhone App and Android App accessibility
- No ATM Reimbursement
- Online Deposits
- FDIC Insurance
- 24/7 Customers Services, Online Chat and Email
Types of Accounts
Discover Bank offers the following types of accounts:
Online Savings Account
Money Market Account
Cashback Debit (Checking) Account
IRA CDs and trust accounts
Discover Online Banking Savings
Discover’s savings account pays a solid 1.50% interest rate. This is in the upper tier of interest rates and comparable to many other online banks. However, when compared to the big banks like Chase, Citi and Bank of America, Discover’s savings account pays far better. This makes the Discover Online Savings account a great choice for an emergency fund.
Like the checking account, there are no minimum balances to avoid fees. So this no-frills savings account is a great place to park a chunk of cash that you don’t expect to need for a long while, such as for a home down payment. This savings account is Discover’s standout product and my favorite account offered by Discover Bank.
Money Market Account
The money market account is an excellent place to earn interest while keeping your funds available for spending. Discover Bank’s money market is notable because the account offers online bill payment—some banks only include online bill payment from checking accounts. That said, federal law limits certain withdrawals (like bill payments) to six per month, so it’s not for frequent spending.
- Deposit a minimum of $2,500 to open an account
- Keep at least $2,500 in your account to avoid a monthly fee of $10
- Earn 1.45 percent APY on balances under $100,000
- Earn 1.50 percent APY on balances of $100,000 or more
- Withdraw cash from over 60,000 fee-free ATMs in the Allpoint and MoneyPass ATM networks
- Spend with your debit card, online bill payment, or paper checks
The money market account at Discover pays slightly less than Discover’s savings account, and that makes sense: You have easy access to the money. By comparison, Capital One 360 pays 0.85 percent on balances below $10,000, and two percent on balances of $10,000 or more—but does not include online bill pay.
The flagship account of Discover Bank is the Cashback Checking account. This account has no monthly fee. Nor does it have a minimum balance or direct deposit requirement. And the included debit card offers 1% cash back on purchases up to $3,000 per month. This is better than most debit cards you’ll find in banking today. Logging in to the Discover website or app gives users access to free online bill pay. In addition, users can reorder checks or a replacement debit card at no fee.
Some activity does incur a fee, however, though these are not very common activities for responsible bank customers. For example, you don’t pay any fees for incoming or outgoing ACH transfers or incoming wire transfers, but outgoing wires have a $30 fee. Most notable to anyone who has paid insufficient funds fees, Discover charges $30 per occurrence with a limit of one charge per day.
Discover Bank offers numerous CDs, some with extremely long terms. To buy a CD, you need a minimum of $2,500. Rates are as follows:
|3 Months||0.35% APY|
|6 Months||0.65% APY|
|9 Months||0.70% APY|
|12 Months||2.00% APY|
|18 Months||2.00% APY|
|24 Months||2.05% APY|
|30 Months||2.05% APY|
|3 Years||2.05% APY|
|4 Years||2.05% APY|
|5 Years||2.10% APY|
|7 Years||2.15% APY|
|10 Years||2.20% APY|
If you’d like to use CDs in an individual retirement account (IRA), you can do so at Discover. The same lineup of CDs listed above can be purchased in a Traditional or Roth IRA.
Buy a CD with at least $2,500
Pay no early withdrawal penalty when early redemption is due to a required minimum distribution (RMD)
Pay no IRA custodial fees
How to Bank With Discover
To open an account, visit Discover.com or call 1-800-347-7000. You’ll need to provide personal details required by most financial institutions:
Names of all account owners
Social Security Number (SSN) or Tax ID Number (TIN) of all account owners
A physical address of account owners (mailing address optional)
E-mail address and phone numbers of account owners
Mother’s maiden name
Employment and income information
Bank account information for any accounts you wish to link to Discover Bank
Other Types of Discover Online Banking Accounts
Discover Bank accommodates a variety of needs. You can open trust accounts, and the well-known Discover Card is an option for anybody who needs a credit card with no annual fees. Discover also handles student loans, personal loans, and home equity loans.
For individuals looking for a truly free checking and savings account with better-than-average interest rates plus debit card cashback, Discover online Banking has you covered. However, with limited card acceptance, reports of longer-than-average times before an incoming deposit clears your account, and many unflattering reviews, it is far from perfect. But if you have simple needs that an online-only bank can handle, Discover Bank can handle it just fine.