High-Yield Rewards Checking Account at a North Carolina Bank (Capital Bank)


Update 6/26/11: The rate is scheduled to fall to 3.01% APY effective 7/11/2011. See bottom of post for the rate history.

Capital Bank is offering a reward checking account called Smart Checking with a yield of 4.01% APY for balances up to $10,000. Balances over $10K earn 0.30%. Monthly requirements to maintain this yield include: 1) 10 debit card transactions, 2) one direct deposit or draft, and 3) e-statements. If these requirements are not met the rate falls to 0.10%. Also, when requirements are met all ATM fees from other banks are refunded. The opening minimum deposit is $100. After opening, there are no minimums and no monthly service charge regardless if requirements are met or not. Update 6/26/11: There is now a $500 minimum average monthly balance requirement to avoid a $8 monthly fee.

Update 9/19/10: A reader has reported being told by the bank that only NC residents are eligible to open this account.

Update 5/13/08: They are now accepting applications online by people from any state. Here is their reply to my email:

Yes, you can open the smart checking account online at www.capitalbank-nc.com, just fill out the application. Once we receive it we will send you more information along with a return envelope to enclose a copy of your photo ID and deposit. After we receive the necessary paperwork back from you we can order you a checkcard and checks.

According to the bank representative, they've been offering the Smart Checking account for about a year now, however, the rate was just recently bumped from 4.01% to 5.01% APY. She expects the 5.01% to hold for awhile. She stated that they only do a ChexSystem verification in the application with no hard credit inquiry. They do require a branch visit to open this account. Branches are located in several cities of North Carolina including Asheville, Burlington, Greensboro and Raleigh. The bank has been FDIC insured since 1997 (FDIC Certificate # 34452).

The 5.01% APY is not the best rate for this type of rewards checking account, but it's competitive. For a list of other rewards checking accounts in the nation, please refer to my best checking account summary post.

Rate History:

  • 07/11/11: 3.01% APY
  • 09/19/10: The bank now only allows NC residents to open the account
  • 03/18/10: 4.01% APY up to $10K; 0.30% over; 0.10% base
  • 11/02/08: 4.01% APY
  • 04/12/07: 5.01% APY up to $25K; 1.01% over; 0.20% base
Eric (anonymous)   |     |   Comment #1
I recently got one of these accounts because I live in Raleigh. The people there are very nice. Online...the interface is very basic compared to Wachovia. Online billpay has to be through the company's page that has billed you. An automatic debit or deposit being required to earn 5% interest, I had expected there to be an interface for this within their system. I'm not sure I was asking the right questions, but electronic money transfers (I'm not sure this is the same as ACH) cost $11 either direction. Not a big deal since they're really easy to get to, but transferring money from my Wachovia account to this account would cost me ~$14 if I didn't go down to the bank, which is pretty pricey. Anyhow, glad to be switching away from Wachovia, better interest, nicer people (so far).
Giorgio (anonymous)   |     |   Comment #2
Unfortunately, I just checked and the rate for Rewards Checking at Capital Bank has fallen to 3%. Available locally only at NC locations