4.52% Checking Account at nBank

This seems to be the checking account with the highest interest rate in the nation. The online bank nBank offers a checking account called nPower XL that currently pays 4.52% APY, and it's not just an intro rate. It's indexed with the 3-month Treasury Bills. The only requirement to receive this rate is a balance of $2.5K. There's a $15 monthly fee if the balance falls below $2.5K. Another nice feature of this checking account is the automatic refunding of ATM fees charged by other banks (up to $8 per month).

From the website it wasn't totally clear that this nPower XL account was a checking account and not a money market account. In the description, it states "Immediate liquidity of a checking account". A money market account has check writing privileges, but unlike a checking account, only 3 checks per month are allowed.

To clarify this issue, I called nBank's customer service. I was pleasantly surprised to have the call immediately answered by a person. Usually, you have to spend several minutes in an automated phone system. The CSR informed me that the nPower XL is indeed a checking account with no check writing restrictions. Also, as you would expect from an online bank, the account can be funded by an ACH transfer.

In addition to those looking for high-interest checking accounts, nBank may be a good choice for small businesses looking for high-interest business money market accounts. It has the nBank Business Money Market account that has the same interest rate as the XL checking account. The minimum balance to open is $5K and there's a $15 monthly fee if the balance falls below $3.5K.

The only potential issue with nBank is a weak finanical condition. Bankrate.com gives it 1 out of 5 stars (weak) and Bauer Financial gives nBank 2 out of 5 stars (problematic). The bank is FDIC insured.

This iBankDesign thread lists 14 banks with checking account rates at or above 3%. In addition to nBank, there are 5 banks with checking account APYs above 4%. Presidential Bank has a 4.25% APY checking account. There's a $1K minimum to avoid monthly fees and it requires direct deposit. City National Bank of Taylor and the First National Bank in Cameron require 10 VISA Check Card point-of-sale transactions per month and direct deposit to be eligible for the high rate. The last two banks have high-balance requirements.