As DA reader, IvoryMale, noted in a Forum post yesterday, Popular Direct has unveiled yet another savings account, the Ultimate Savings Account, which currently earns 2.55% APY. The minimum opening deposit is $5k, although the minimum balance to earn the stated APY is only $0.01.
Popular Direct has a history of creating a new savings account with a higher rate to attract new customers and/or new money, leaving the owners of the phased-out accounts stuck with a lower rate. The Ultimate Savings Account is the fifth savings account Popular Direct has introduced in the last three years. In May 2018, Popular Direct discontinued its Exclusive Savings Account, only five months after being introduced. Its replacement was the Plus Savings Account, the very account the Exclusive Savings Account displaced in January 2018. (I know – it’s hard to keep the players straight.) The Plus Savings Account (2.36% APY) was available until the Ultimate Savings Account made its debut this week.
Opening an Ultimate Savings Account
Getting the “true” facts about opening a new account is always challenging. I spoke to several different CSRs over the past two days and received some conflicting information, but every CSR stated that new money is NOT required to open an Ultimate Savings Account (USA) and funds from an existing Plus Savings Account (PSA) can be used. I was told that the way to transfer PSA funds is to “fast track” those funds. The USA online application asks if you have funds in an existing Popular Direct account. If you reply “yes”, the next step is to provide the PSA account number and the dollar amount in the account as of the last statement. You may “fast track” the PSA funds into the new USA, but a minimum of $500 must be left in the PSA. After the USA is established, you can then close the PSA and transfer the remaining $500 to the USA.
Ultimate Savings Account Facts
The Ultimate Savings Account Disclosure provides important information about fees and policies. FYI – even though the name of the savings account has changed, the information stated in the Account Disclosure has not changed since I cited it in a February 2018 blog post.
- Minimum opening deposit is $5k
- $4 monthly service fee if the balance on any day is below $500.
- $25 early closing fee if account is closed within 180 days of opening.
- $5 monthly dormancy fee if there has been no activity for 12 months.
- Withdrawals only allowed via an external account, internal transfer to another Popular Direct account, or ACH.
- $5 fee for each additional debit exceeding the limit of six per statement cycle.
- Deposits only allowed via an external account, internal transfers to another Popular Direct account, ACH, or Popular Direct mobile app.
There’s one fact that seems to contradict the information I received about opening a new Ultimate Savings Account. The “Transaction Limitations on the Account” section states,
As part of the account opening process, you must make a deposit into your Popular Direct account from an External Account.
Taken at face value, it would seem to imply that only new money can be used. CSR explained it this way: the establishment of a validated external account is the intent of that statement, not the origin of funds being used. If you already have an account with Popular Direct, you have a validated external account in place. If you are new to Popular Direct, a required part of the application process is establishing a link to an external account.
Last year, Popular Direct announced a new policy that prevented new customers from accessing money in their accounts for 60 days, effectively freezing accounts for two months. There has been a slight improvement made in this unpopular policy. If you hover your mouse on the “Apply Now” button, a pop-up window displays the following:
Effective January 2, 2019, Automated Clearing House (ACH) debits that originate from external financial institutions, other than from the deposit account that you have successfully validated through the “External Transfers” function in Popular Direct Online Banking (the “External Account”), will not be permitted during the first 70 calendar days after opening your Popular Direct Ultimate Savings Account. During such 70-day period you will only be permitted to complete online transfers from the External Account or from your other Popular Bank accounts.
While the account freeze has been lifted, you can only withdraw funds using ACH to the validated external account. As DA reader, SYC, noted in a Forum post today, “the External Account” means one account.
Beware: Only one external bank account is allowed to be linked to your Popular Savings account.
Many thanks to IvoryMale and SYC for their helpful Forum posts.
An online division of the New York-based Banco Popular North American (BPNA), Popular Direct’s website states,
All Popular Direct deposit products are offered by, and will be opened through, Banco Popular North America (BPNA). BPNA is a Member FDIC institution and a New York state chartered bank.
Opening any type of account with Popular Direct, including the Ultimate Savings Account, must be done online.
Popular Direct/BPNA has an overall health grade of "A+" at DepositAccounts.com, with a Texas Ratio of 5.74% (excellent) based on March 31, 2019 data. In the past year, the Bank has increased its total non-brokered deposits by $584.9 million, an excellent annual growth rate of 9.42%. Please refer to our financial overview of Popular Direct/BPNA (FDIC Certificate # 34967) for more details.
BPNA is currently the 11th largest bank headquartered in New York, with assets in excess of $9.5 billion and more than 208,000 customer accounts.
In June 2017, The New York Times published an article about Santander’s takeover of the failed Spanish bank, Banco Popular. The similarity in names caused some concern for a few DA readers about BPNA. To quote myself from a Forum post,
Popular Direct is a division of Banco Popular North America, which is a subsidiary of the Puerto Rico-based bank holding company, Popular, Inc. I can find no connections between Popular, Inc. and the Spanish Banco Popular.
How the Ultimate Savings Account Compares
When compared to 218 Personal Savings accounts tracked by DepositAccounts.com that are available nationwide, Popular Direct’s Utlimate Savings APY currently ranks second.
The above rates are accurate as of 7/31/2019.
To look for the best Savings account rates, both nationwide and state specific, please refer to our Savings Account Rates Table page.