Online Banking Part I – Ally Bank Review
I’ve finally made the leap into [complete] online banking last week. I admit, even after years of using many of the online tools offered by my local brick and mortar banks, I’ve always hesitated at the idea of stashing your money away with a company that has no local office that you can walk into. But I had to make an honest assessment of my financial habits and priorities. The fact is I am low-income and I am not an attractive classic ‘retail bank customer’ in that I will not be applying for any loans, or credit lines any time soon. Nor do I need to really handle cash. So other than the ability to talk to a teller and eat the free lollipops on the counter, brick & mortar banks offer little advantage to me.
Now, I’m a firm believer in not keeping all of your money in one place – so I have two online banks. I think that each one deserves its own post. This one will be dedicated to Ally Bank.
I’ve been with Ally Bank for almost three years. However for the first ten months or so, I only had a savings account with them. On average, savings accounts have a ridiculously low rate of interest – around 0.08% APY. Ally Bank’s rate is considerably higher at 0.99% APY; although in my case, with my low account balances, it is not going to make me rich any time soon. Still, it is nice to see those small deposits placed into my account with every monthly statement cycle. With traditional savings accounts, you’re lucky if you get even one payout at the end of the year.
Ally Bank is known for their incredible customer service and my experiences pretty much confirm that. Their online customer service reps are knowledgeable and personable. On the instances where I’ve used them, there has never been a wait. But then again, knowing me, I was hitting them up in the middle of the night. No problem – since their hours are 24 hours a day, 7 days per week. 🙂
I opted to open a money market account with Ally in addition to my savings account so that I could get access to a debit card. Prior to that, the only way for me to withdrawal money, was to initiate a bank transfer. While my money market account has checks and a debit card, I am limited (as all money market accounts are) in the number of transactions I can perform in a month. For me, it’s not a big deal. ATM withdrawals are still unlimited. The important part is that I can get access to my money if need be.
Ally Bank also offers a checking account. However, from what I hear, they check your credit as a condition of opening one. Whether they use your credit score, or ChexSystems, I personally can’t confirm. I will tell you that I have horrendous credit and I’m on ChexSystems, yet had no issues opening up a savings or money market account. So it is entirely possible to have an online bank account regardless of your credit.
Banking with Ally
As I mentioned previously, customer service is not an issue with Ally – nothing but praise there. Their mobile app is adequate. I’ve made photo deposits of checks with little problem. You do have to “make” your deposit by 4:00 pm to count for the same business day – which is a bit early I feel. Especially when ACH transfers can be scheduled up until 7:30 pm and count for the same business day. So that’s all a bit confusing.
Several people have grumbled about Ally Bank holding check deposits. While I agree, it is frustrating to not have that instant availability of funds that you may be used to after depositing your check at your local bank, I can understand where they are coming from. Waiting for a check to clear is the best way to insure you won’t have a big loss due to bounced checks. This loss minimization results in higher interest rates. Also if you bounce a check or overdraft your Ally bank account, future deposits will be subject to a long hold (10 days). So be mindful of this.
Direct deposits and transfers are speedy. Both my direct deposit paycheck proceeds and PayPal credits always show up in my Ally Bank account faster than they do in my brick and mortar bank account. Ally’s app and website are very well designed, intuitive and well-designed. No complaints there either.
I’ve never utilized Ally’s online bill pay or Pop Money features, so I have no comment on those.
To date, I’ve experienced no major cons with Ally Bank. They did require me to fill out a signature card upon opening my money market account. Personally, I didn’t see this as a problem, but others have.
Very recently (mid-August 2015) Ally Bank made some changes to their operations and fees. While I see these changes as being ultimately inconsequential to me, there are many Ally Bank customers who are quite upset. The first change is that Ally Bank use to reimburse all ATM fees incurred at non-Ally bank ATMs. This was pretty cool, and you wouldn’t think twice before using any ATM with your Ally Bank card. However they are now limiting this reimbursement to $10 per statement cycle/month. They also changed their ATM network to Allpoint. I haven’t sat down and crunched the data, but my guess is that Allpoint is more prevalent than whatever network Ally Bank was on previously.
The second change is regarding overdraft charges. Previously, they were only $9. Now — $25. Not the highest ones out there…..but significantly more. However Ally Bank only charges on overdraft fee per day. So you won’t get that instance where you are charged $25 each time you swipe your card after a check you deposited bounced. Which is nice (and fair).
I have no serious complaints about Ally Bank and would recommend them to others – especially those who may need a bit of discipline in regards to their check writing and spending. Fees are low, interest rates are high(er), and customer service is outstanding. You really can’t ask for more from an online bank in my opinion