Ally Bank Checking Review, After 3 Months As Primary Account

(Update October 2011: Ally has just announced that eCheck online deposit is available to all interest checking, online savings and money market accounts. So even if you just have the online savings account, you can deposit checks into it via scanner from home. I’ve updated my review below accordingly.)

Ally Bank LogoIt’s been a few months since I opened up an Ally interest checking account to complement my existing 5-year CDs and online savings account. Click here for a rundown of features that show why I made the switch. I’ve managed to try out many of their “perks”, including their official Perks program. Here are my experiences:

Unlimited ATM Rebates Anywhere in US
I’ve made a few ATM withdrawals at random ATMs, and the surcharges have been credited at the end of the month as promised. (I wish they were credited immediately.) Actually being charged those fees made me realize how fast $2-$5 a pop can add up. My fee rebates were almost higher than the interest I earned one month! I actually feel bad making Ally pay for something I could avoid, so whenever possible I still use my local bank’s ATM card for now. International ATMs are not eligible.

Free Overdraft Transfers from Savings
The checking account pays less interest than savings, so it is best to open both and keep as much money as you can in the savings. The Ally online saving account currently pays 0.85% APY, and is one of the places I keep my emergency fund cash. With their free Overdraft Transfer Service, Ally will automatically transfer the required funds from savings if your checking goes negative. I actually initiated this last month when I wrote a check, here’s the screenshot from my account:

Ally transferred an amount equal to a round number near the overdraft amount plus $100. Alternatively, you can set it to auto-transfer a preset amount over if your checking balance dips to a certain threshold.

eCheck Online Deposit
Ally eCheck Deposit is a feature where you can scan in your checks over the internet with a desktop scanner. A smartphone camera-based app is supposedly in the works. This is now available on all interest checking, online savings and money market accounts. I have made multiple deposits successfully on a Mac after following their instructions carefully. (On Mac OS X, users have to use 32 bit mode for Firefox or Safari and Javascript. Chrome is always 32-bit.)

The process is straightforward. You must endorse your check with your signature, the phrase “For Ally eCheck Deposit Only”, and your account number. You can also deposit directly into your Online Savings account. The funds availability policy is such that checks submitted before 4pm Eastern will post the next business day, otherwise the 2nd business day. Your deposit starts earning interest as soon as the check posts, although for large deposits you may have a hold preventing immediate withdrawal.

Ally Perks Debit Card Rewards
This is a free rewards program that is linked to your Ally Checking debit card. It’s not a % cashback program on everything like that offered at PerkStreet Financial, but instead is more of a coupon-style service that works at specific online or brick-and-mortar merchants. I did see a few opportunities for some easy savings, for example $1 off a $1 minimum purchase at iTunes, $5 off $50 at Lowe’s in-store, and $2 off $7 at Subway.

You don’t need any coupons or codes, just pay with the Ally debit card and the discount amount is deposited directly into your checking account. I plan on checking in from time to time for any useful discounts, but this program certainly won’t convince me to buy things on their debit card. I’ll stick with credit card rewards.

Comments

  1. Ally is great. Excellent account features and superb customer service. I’d use them as my primary checking account if I didn’t have a USAA account.

  2. Money Beagle says:

    How in the heck can they afford to reimburse you on the ATM fees? I think it’s noble that you make an attempt to keep these costs low, but there are probably others that don’t even give this a second thought. I can’t imagine this is a moneymaker for them, so hopefully they don’t cancel this perk for you.

  3. hawks5999 says:

    Re: ATM fees: I wouldn’t feel too bad for ally or any bank. They take your deposited funds and turn around a lend them out for 4%-30% through mortgages (GMAC), auto loans and credit cards. Kicking a few dollars back to you as an incentive to keep your cash there, is the least they can do.

  4. Have you tried billpay? Does the money leave the account on the send date or receive date? If a paper check has to be sent, when does that money leave the account?

  5. Agree with hawks. It’s their business decision. What if they were your primary/only bank (I promise you, they’d love that)?

    I can vouch for the international ATM fees. I was in Mexico last month, and had them reimbursed. You have to save your receipts and send them an e-mail with a summary of your ATM fees. The problem is that due to foreign currency exchange, the ATM transaction comes to $132.87 or something, so there’s no way for them to know what the fee portion is (apparently that’s how they know with domestic fees — $103.00 means there was a $3 ATM fee). So you just tell them what it was, and I guess they just take your word for it!

  6. P.S. you should really mention their new P2P payment system. I haven’t used it, but I have used INGdirect’s, and it was really the only reason I was with them. If Ally’s prooves to be well-executed, I think I may drop my ING account.

  7. Does Ally have free subaccounts like ING? We usse that extensively for budgeting.

  8. Sargonas says:

    @Chip

    They have had subaccounts for a while but do not advertise them as ING does. I did a quick google search and came back with this:
    http://www.wealthinformatics.com/2010/05/24/how-to-create-subaccounts-at-ally-bank/

  9. Is there some reason that you use this checking account when reward checking accounts are offering up to 4% APY?

  10. @MoneyBeagle – Well, for one, this way Ally doesn’t have to pay to maintain an ATM network. I can’t imagine it’s cheap. Second, I don’t think people use ATMs nearly as much as they used to.

    @Larkin – I’ve used the BillPay but I’m afraid I haven’t recorded those details, all I know is the payment arrived by the stated date.

    @GregK – Thanks for the update, I was wondering how they figure out the amount of the free on currency conversions. I’ve heard about the P2P payment system, what makes it special?

    @Chip – I don’t know if I would call them subaccounts, they simply let you open as many accounts as you want, and since they all have no minimums and no minimum activity you can use them however you want. It is nice, and I also use that feature to open multiple smaller CDs instead of one big one to avoid early withdrawal penalties.

    @Justin – I use rewards checking accounts, but only for the interest along with CDs and savings bonds. Check out my “emergency fund” post. The rewards checking account I use doesn’t offer ATM rebates and the online interface is rather poor. The rewards interest rates seem pretty volatile as well, so I don’t want to commit.

  11. Al Sanchez says:

    Let me get this straight. If I have $200 in my savings, and $20 in my checking, if I overdraft checking with a $50 charge. I get the $30 withdrawn from savings, plus $100 …. and I don’t pay an overdraft fee?????

  12. @Al Sanchez – I don’t know if they will add $100 to a smaller overdraft or some smaller amount, but yes that is the basic idea. You won’t be charged an overdraft fee as long as your savings can cover it.

  13. It also means that if someone steals your checks, they can wipe out your savings too.

  14. @Al, Jonathan – They transfer $100.

    I had $0.00 in my checking, withdrew $43.00 at an ATM ($40+$3 fee), and they transfered $100 from my savings account. I was left with $57 in my checking ($60 at the end of the month… actually $60.07 after interest haha – to Jonathan’s point, my ATM rebate was 43X the interest earned). No fees.

    I should mention that this sort of service is available from almost every bank I’ve done business with, though only two or three of them do it without charging a fee. It’s also important to note there would be a charge if you had more than 6 withdrawals from your savings account in a month, for any reason, including overdraft coverage.

    @Jonathan – not sure if there are advantages to Ally’s P2P system, but it does help to round out their product offerings. They appear to use PopMoney as a vendor.

    https://www.ally.com/bank/online-banking/?INTCMPID=OnlineServices_HP#tabs=move-money

    PopMoney also partners with these banks:

    https://www.popmoney.com/popnet/faces/popmoney/common/about.jsp?name=partners

  15. Need cash and no network atm around? Go buy a atick of gum at a super market. Seriously…why do people pay fees on amt withdrawals when they can get something they’ll use as the “fee” for the cash?

  16. Meh, not worth switching. I asked ally about edeposit & flat out told me no, no mention of rollouts. Schwab offers same benefits and has an excellent edeposit app, judt

  17. They need an iphone and Android app with remote check deposit and bingo they become THE bank. Ally, what are you waiting for?

  18. Chandra says:

    How do you compare among ING, USAA, & Ally ?
    Any recommendations ?

  19. @larkin. The money leaves your account on the deliver date. So if a check is sent it doesn’t matter when the check is actually cashed; Ally will debit your account on the day that they expect the post office to deliver it. This is pretty standard among banks.

    @Chandra. I have had accounts with ING and Ally. I personally prefer Ally over ING.

    re: Ally Perks. I tried it tonight for the first time. I was expecting to have to wait until my statement cycled to see the Ally Perks Credit but it was immediate. Pretty cool but I too will not give up the cash back that my credit card offers to use my check card as a primary means of payment.

  20. I was wondering how does Ally bank’s checking (and savings) account compare with Capital One’s?

    http://www.capitalone.com/directbanking/online-checking-accounts/interest-online-checking-account/

    http://www.capitalone.com/directbanking/online-savings-accounts/interestplus-online-savings-account/

    The rates look better than that of Ally bank with almost all the features with following differences:

    pros:
    1. The interest rate of 1% is guaranteed for the first year (for Checking a/c)
    2. You earn 10% extra every quarter if you keep over $10K (for Savings a/c)
    3. No ATM fee for foreign transactions

    cons:
    1. The ATM refund has a maximum of $25 per month
    2. Not able to scan our checks to deposit
    3. Only first 50 checks are free
    4. Minimum initial deposit is $500 for checking a/c

    Did I miss anything here?

  21. I just had a Live chat with Ally representative. He said Ally does not refund ATM fees for international transactions. Following is the chat:

    Jamie: That is a great question. Ally will refund all Domestic ATM fees.

    ME: But what about ATMs in foreign countries? For example if I go to Europe or India and use my card there to take out cash, will Ally refund foreign transaction fees and fees charged by the banks in those countries?

    Jamie: No. We will not refund those ATM Fees.

  22. Thanks Radhey, I have heard this also and updated the post.

  23. Quick question but did you receive the PIN number for the ATM card in another mailing? Thanks!

  24. I just signed up for an IC account last week and tried out the echeck deposit using my AIO. It was very easy and took me just a couple minutes. The deposit showed up the next day in my account. Now I’m in the process of switching everything over which is such a daunting task.

  25. Do you know when we open Ally Bank Checking and/or savings account, Is there a Hard Pull Credit Inquiry or just a soft pull ?

  26. @JJ – Yes, the pin comes in a separate letter. It should say that on the letter that came with the card 0_o

    @Sara – No credir inquiry since it’s just a checking/savings account. You get a credit inquiry when you apply for a credit card!

  27. @Jimmy

    Thanks for the info! Just wanted to know their security :)

  28. My only complaint with Ally is that they still send statements via snail mail while every other institution seems to offer electronic documents for everything. I had asked them in the past via chat if they offered all electronic statements on my savings account and they said no.

  29. Just checked my savings account and they now have all electronic statements. So, never mind the previous post.

  30. I like the bank and the new feature of echeck deposits. But I opened the account 4 months ago to see how the interest will be posted. Today I decided to chat with them and they told me that when I reach $1.00 on interest they will post it on my account. What???? ING Direct and USAA deposit every ending cycle, even if its 0.01 cent. i was hoping to use them as our main bank but I don’t know now because of this. We have high balances in savings and checking but who knows what if at some point its not the case? I don’t know I like to see my penny’s piling up. In this economy every cent count to our family.

  31. I am new to online banking. So how do I deposit my money? Do I need an existing bank account first? I’d really like to just have this one. Thanks for the help and writing th
    is.

  32. @ Dyn – I think, correct me if I’m wrong, that you can go to a 7-11 store or anywhere else that does money orders and get a money order from cash to pay yourself. Just eDeposit that money order/cashier’s check. Seems like a legit workaround to me. All other checks you just deposit, and if you have an existing bank account somewhere, you can transfer the balances in or out between the accounts.

    @ Everyone else
    I’m actually signing up tonight. Been researching this for the past year and Ally seems like a good try. Sure wish they had an iPhone application, though. That + iPhone deposit would be stellar. Chase, Bank of America and Paypal have offered this for some time now…it only makes sense for the online-only checking providers to follow suit.

  33. I recently opened a Bank account after avoiding banks like the plague for years. All of the fees and nickle-and-diming just made me frustrated. So far, I like Ally, I haven’t done much except deposit my check. That was dumb because they haven’t mailed me my checkbook or bank card yet. It takes 7-10 business days for them to get it to you, and they’ll only send them to you AFTER you deposit money into your account. Kinda defeats the purpose.

    So far that’s the only drawback for me, albeit a short-lived one. The only thing I would really like to see from them is an Android/iOS app. The fact that you have to actually scan (i.e. with a scanner) your check is so funny. I’m lucky I had my brother in laws old scanner that I dug out of a dusty box. Oh Ally, why don’t you come and join us here in the 21st century. o.0

  34. Hey, quick question –

    I am looking to switch to a new checking account and am thinking of going over to Ally. Is it okay to have a checking account with an online only bank and not have a local bank account? Thanks!

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