SoFi announced Thursday that members can take advantage of a new checking and savings account with an APY of up to 1%. In addition, the account has no overdraft, service or transfer fees.
According to the press release, the APY of 1% is 33 times higher than the national average. To qualify for the high rate, members will need to use direct deposit. APY applies to balances up to $50,000, after which APY drops to 0.05%.
Customers who do not use direct deposit will receive an APY of 0.25%, which is still quite high compared to other accounts.
The checking and savings account, along with SoFi’s suite of money management tools, is intended to be “an improved replacement for people’s current bank.”
The new accounts will also feature no limits on transfers between accounts, two-day advance paychecks and no ATM withdrawal fees for ATMs in the Allpoint network. There are no minimum balance requirements for either account.
SoFi checking and savings accounts give customers access to money management tools, including automated savings and SoFi vaults. SoFi Vaults are extensions of customer accounts that allow them to set aside money for emergencies, bills, or to meet savings goals.
Additionally, SoFi offers the SoFi Relay, which is a financial information tool that connects customer accounts in a mobile dashboard. From here, customers can manage their checking, savings, and investment accounts, as well as track spending and set financial goals. The tool will also monitor customers’ VantageScore 3.0 credit score drawn from TransUnion’s credit reports.
With the announcement of the new accounts, SoFi is moving away from its SoFi Money program. New customers won’t be able to sign up for SoFi Money, as the new bank accounts will feature many of the same money management features.
Current SoFi Money customers will have the option to upgrade to savings and checking accounts “by answering a few simple questions and reviewing the new terms and conditions.”
SoFi isn’t the only financial services company to recently announce a high-yield bank account. American Express has announced its own all-digital consumer checking account with an APY of 0.5%. AmEx offers a debit card with the account that earns 1x membership point for every $2 spent.
Although SoFi does not provide debit card related rewards, there is the SoFi credit card. It has no annual fee and offers cardholders 2% cash back when points are redeemed to pay off eligible debt, deposited directly into the SoFi checking and savings account, or used for investments with the SoFi investment account. The card earns 1% cash back when cardholders redeem points for statement credits.