Interested in opening a savings account at Discover® Bank? Read this article first. Note: I’ve recently updated this review to indicate that transaction downloads for Quicken are now available.
Last year, I noted that E*TRADE Bank will be moving some customers’ accounts to Discover Bank. The only customers affected by this move are those who do not have brokerage accounts. I have a brokerage account through E*TRADE, so my savings account will not be moved.
Nevertheless, I am interested in checking out Discover® Bank because they are currently offering a very good interest rate.
Discover® Bank’s current interest rate yield and apply for an online savings account.
Deal of the Day: Earn 1.00% APY on an FDIC-insured savings account at Ally Bank.
Keep reading this article for a full review of opening and using a bank account at Discover® Bank.
Opening a Discover® Bank Online Savings Account
Step 1. Deposits at Discover Bank are insured by the FDIC and the bank has earned a five-star “Safe & Sound” rating from Bankrate. FDIC insurance alone, regardless of the five-star rating, ensures that regardless of the solvency of the bank, I will be able to withdraw my full deposit when needed.
When beginning the application process, Discover Bank lists everything needed to open an account. The few requirements lead me to believe that the account opening process will be smooth and quick. As with all banks, an address inside the United States, a date of birth, and a Social Security number are necessary.
I choose at this point to open a savings account. Discover Bank also offers FDIC-insured Certificates of Deposit (CDs) and CD Individual Retirement Accounts (IRAs) with high interest rates as well as Money Market Accounts.
At this time, Discover® Bank allows the new customer to add a joint owner to the account. I don’t plan to share this account, so I decline.
Step 2. The second page of the application determines how to fund the account. I decide to link the account to my ING Direct Electric Orange checking account with an initial deposit of $2,500 funded electronically. (Ed. note: ING Direct became Capital One 360 in 2013.) Discover Bank requires a minimum of $500 for the initial deposit. If you would prefer to fund your account via a wire or check, Discover® Bank offers these options as well.
In order to give your consent to Discover® Bank to perform an ACH transfer, you will need to provide an electronic signature.
Step 3. All that remains now is to verify the information you have provided and electronically sign the tax certification. Banks are required to keep account owner signatures on file, and Discover® Bank handles this electronically as well.
Step 4. Once the bank processes your application, you will be presented with a number of security questions based on the information in your credit report. Many websites use this type of authentication now. For example, you may be asked to select the town where you lived previously from a list of choices.
Note: On the confirmation page, you will see your full account number. Save this information by printing the page now because you will need your account number later in order to activate your online access. The bank will not send it to you through email, and it will take up to ten days to receive your welcome package in the mail.
After passing the security and identity check, I received an email confirming the creation of my new account, including a partially-hidden account number. Those who decide to fund their new account via check will receive in this email the bank’s depository addresses for regular U.S. mail or overnight mail. Interestingly, wire transfers are processed through Mellon Bank rather than being sent directly to Discover Bank.
Using the Discover® Bank Online Savings Account
Twenty-four hours and ten minutes after receiving the first email, I received the second in which Discover informed me my account has been funded. That is faster than I expected, considering I started the process over a weekend. This email includes a link to Discover’s website whereupon I can register to view my new account online. After verifying this email was legitimate and not a phishing attempt, I followed the instructions.
Did you save your account number? If not, you will need to call the Bank’s customer service. You need the account number, your Social Security number, your date of birth, and your mother’s maiden name in order to activate online account access.
After selecting a user ID, a password, and security questions, you will be able to view your account online. I was surprised to see Discover® had already posted interest to my account. You can see how much I received for one day in the screen shot included here.
You can use the Discover® Bank website to set up recurring transfers through their “Automated Saving Plan” or initiate a one-time transfer from a linked account. If you want to link a new account, you will be asked to enter the banking information and required to verify small trial deposit amounts. Unfortunately, the account I used for the initial deposit is not automatically considered a linked account. I must go through the process of adding the same account to the list.
Discover® Bank does not support Direct Connect (automatic configuration of the account and transaction downloads directly from Quicken), but it does now support Web Connect (transaction downloads by logging into the website). You can also include Discover Bank on Mint.com and any other website powered by Yodlee.
Discover® Bank also offers a money market account for paying bills. This type of account offers debit card access, but you will need a balance of $10,000 to earn interest at a competitive rate.
The process of opening a Discover® Bank online savings account was smooth and quick. This is the opposite of what I experienced with Everbank. When I called Discover’s customer service to get my account number, the representative was helpful and friendly. My call, placed on a Sunday afternoon, was answered without any hold time. Discover® Bank’s features are basic, but it meets the needs of savers with the bonus of a highly competitive interest rate. I plan on taking a closer look at the bank’s high-yield CDs in the near future. After nine months, I haven’t had any problems with my Discover® Bank.
What do you think of Discover® Bank? Let us know in the comments.
|Routing (ABA) number||031100649|
|Established||August 30, 1911|
|Savings interest rates||Click here to see rate|
|Money Market interest rates||Click here to see rate|
|IRA CD interest rates||1-year IRA CD rate, 10-year IRA CD rate|
|Standard CD interest rates||Click here to see rate|
|Location||12 Read’s Way, New Castle, Delaware|
|Direct Connect||Not supported|
Updated August 16, 2016 and originally published January 4, 2011. If you enjoyed this article, subscribe to the RSS feed or receive daily emails. Follow @ConsumerismComm on Twitter and visit our Facebook page for more updates.