Update 3/12/2010: There is no longer a 90-day intro rate. Standard rate has fallen from 1.50% APY to 1.00% APY for balances of $10K+ and from 1.00% APY to 0.50% APY for balances under $10K.
The Provident Bank in New Jersey has started an internet bank called ProvidentNJ Direct. It offers two internet checking accounts and a savings account called Power Savings. The savings account is the best deal. They have a promo with a 3.25% APY guaranteed for the first 90 days from account opening. After the intro period, the standard rates apply: 2.25% APY on portion of the balance over $10K, and 1.75% APY for the portion of the balance between $50 and $10K. These rates are listed at the bank's website as of 4/29/09.
Some of the features listed on the bank's website include:
- $50 minimum opening balance and $50 minimum to earn interest
- Free online account with no fees or service charges
- Must participate in ProvidentConnect Online Banking and receive periodic account statements electronically
- ATM card available
The bank's FAQ doesn't provide too many more details, and I can't find any details about an ACH bank-to-bank transfer service. I'll try to call and get more info on this later (see update below).
The website specifically states that the account is available to consumers nationwide. There's an online application via Andera which allows you to open the account online and fund it with an ACH transfer from your current checking or savings account.
They also offer an online checking account called Green Checking. The 3.75% APY may make it look like a great deal, but this rate only applies to the first $1,000. The rate above $1,000 is only 0.50%. However, this isn't too bad for a non-reward checking when you consider ING Direct's Electric Orange only pays 0.25% for the first $50K. There's also a myTunes checking account which offers free iTunes downloads.
I was hoping that they would be offering their reward checking account nationwide. But it appears this remains a local deal (see post) for those in New Jersey. It currently pays 5.01% APY for balances up to $25K, but a reader has reported that it's scheduled to fall to 4.01% starting in May.
The Provident Bank is based in New Jersey and should not be confused with Provident Bank in Maryland that recently merged with M&T Bank. It's a fairly large bank with $6.5 billion in assets and $4.3 billion in deposits. The bank has been FDIC insured since 1934 (FDIC Certificate # 12010).
Thanks to the reader who emailed me news of this account.
Update 9/30/09: External Transfer Transaction Limitations:
A reader reported receiving the following from ProvidentNJ Direct:
Dear Valued Customer,
The world of Internet banking continues to evolve at an unprecedented pace, to which banks must continuously look at industry best practices to protect both customer and bank assets. This notice is being sent to inform you of two changes to The Provident Bank's Internet Banking service, which will become effective on September 29, 2009.
The Provident Bank has implemented a daily limit of $2,000 on external transfers from each of your Provident accounts, as conducted via Provident Connect. This daily limit is applicable to external transfers (transfers from your Provident account to an account at another financial institution) conducted Monday through Friday. Any transfers requested on Saturday or Sunday will be added to transfer requests made on the following Monday. Note: This transaction limitation does not affect transfers to or between your Provident accounts.
In order to close accounts with balances exceeding $2,000, you must send a secure message through Provident Connect providing the Bank authorization to close your account. Within one business day after we receive your authorization, a check for the balance of your account will be mailed to the address we have on file.
Electronic funds transfers processed via online banking to your Provident accounts from another financial institution will be available for withdrawal or transfer outside of The Provident Bank on the third business day following the day of deposit.
Please understand that the above limitations are being implemented to protect your accounts from unauthorized activity.
As Internet services continue to evolve, The Provident Bank is continuing to work with industry experts to ensure our practices meet both the high standards of performance expected by our customers, as well as the security needed to give you peace of mind.
The Provident Bank
Update 3/12/10: There is no longer a 90-day intro rate. Standard rate has fallen from 1.50% APY to 1.00% APY for balances of $10K+ and from 1.00% APY to 0.50% APY for balances under $10K.
Update 8/14/09: The 90-day intro rate has fallen to 2.00% APY, and the standard rate has fallen to 1.50% APY for balances of $10K+ and 1.00% APY for balances under $10K.
Update 7/17/09: The 90-day intro rate has fallen to 2.50% APY, and the standard rate has fallen to 2.00% APY for balances of $10K+ and 1.50% APY for balances under $10K.
Update 6/20/09: The 90-day intro rate has fallen to 2.75% APY.
Update 5/25/09: The 90-day intro rate has fallen to 3.01% APY.