Charter Bank made two other changes attempting to make up for the new low rate. The maximum balance that qualifies for this top rate was increased from $25K to $50K. Also, they now only require one debit card purchase per month rather than 13. For those using this reward checking account as an alternative to an online savings account, these two improvements are little help since you can still easily find higher savings account rates at many internet banks.
It's interesting to see them slash the monthly debit card requirement to only one. This seems like they're admitting that they're not making much from the debit card usage. I recently discussed the impact of debit card purchases on reward checking accounts in this post on City National Bank.
There has also been another major change to a nationwide reward checking account. I received confirmation on Friday that Libertad Bank is no longer accepting new applications for its nationwide reward checking account that's paying 3.50% APY. The rates remain the same for now for existing customers (see post).
We're seeing a lot of changes now with reward checking accounts. I just reported on Friday about the rate and balance cap cuts at First Arkansas Bank & Trust (see post).
Below is part of the email that Charter Bank customers received yesterday (Thanks to the reader who forwarded this to me):
As the financial markets continue to fluctuate, we are working hard to ensure that MORE of your money earns higher-than-average rates. To accomplish this, several changes to your TurboChecking Account will go into effect today, November 2, 2009.
While the maximum rate that Turbo will pay will be reduced to 1.25% APY, The maximum balance on which you can earn the maximum will DOUBLE to $50,000, and You will only need to post ONE debit card transaction per cycle.
This makes it easier than ever for you to earn the maximum rate and enjoy the other unique benefits of your TurboChecking account!
STILL No ATM Fees Nationwide
STILL Overdraft Privilege
STILL No cost Online Bill Pay
Beginning November 2nd, the following rates will be paid when you meet the monthly requirements
* Earn 1.25% Annual Percentage Yield (rate of 1.243%) on your balances of $0 to $50,000, 1.01% Annual Percentage Yield (rate of 1.01%) on all amounts above $50,000, and 0.25% Annual Percentage Yield (rate of .25.%) on all balances if the requirements are not met each statement cycle.
We've been a rewards checking leader since we began TurboChecking in October, 2007. Be assured that as the marketplace allows, we will pay you the highest rate that we can.
We believe you will find that TurboChecking still offers a good return on your deposits.
To find reward checking accounts or to learn more about these accounts, please refer to my High Yield Checking website. Note, I'm in the process of updating the tables with the recent rate cuts and changes from many banks.
