3.84% Reward Checking Account at Chartway Federal Credit Union

Chartway FCU is offering a reward checking account called eChecking that pays up to 3.84% APY for balances up to $20,000 (1% for above) and refunds ATM fees of up to $8 per cycle if the following monthly requirements are met:

• 8 check card purchases
• one direct deposit or ACH of at least $500
• active eBranch and eStatement service

If these are not met, no interest is earned. In addition, to the above monthly requirements, it also requires an eSavings account and a minimum balance of $5,000 to earn interest. A rate of 5% is earned on the portion from $5,000 to up to $20,000 and zero interest is earned on the first $5,000. This results in an APY of 0% for a $5,000 balance to an APY of 3.84% for a $20,000 balance.

There's also a potential monthly fee of $4.95 for the online Bill Pay if you don't pay at least 3 bills a month.

It seems like a minimum balance to earn interest is becoming more common for reward checking accounts. The vast majority of reward checking accounts earn interest on all balances from zero to some maximum amount. Also, the fact that no interest is earned on the first $5,000 is an unusual and disappointing feature.

Membership is open to those who live, work, worship or go to school in a defined geographic area served by the credit union's Virginia, Florida, Rhode Island and Texas branches. A reader noted in a previous post that the geographic areas are narrow, so please call to see if you can be eligible. You can also be eligible via schools and select employer groups. The online application has a list of eligible schools and emloyers. Please refer to their Membership Page for more details. Membership requires a $5 minimum deposit into the Prime Share savings account. Update 11/09/09: A reader has reported the following: "Chartway CU accepts city/federal employees from all states under 'Civil Service' category."

Branches are located in Virginia, Georgia, Rhode Island, North Carolina, Texas, Florida, Ohio and New Jersey.

Chartway is federally insured by the NCUA (Charter # 13242). It has $1.3 billion in assets and 154,477 members.

Thanks to the reader who mentioned this reward checking account in the Finding the Best Deals post.

Other Reward Checking Accounts

To find reward checking accounts in other areas of the nation or to learn more about these accounts, please refer to my High Yield Checking website.

Edit 2/02/09: Clarified the interest rate tiers. The way the tiers are done, the maximum APY that can be earned is only 3.84% for a balance of $20K rather than 5%.