Quontic Bank High Interest Checking Remains Competitive

While New York-based Quontic Bank lowered the rate on its High Interest Checking to 1.25% APY a few days ago, the $1 million qualifying balance cap is still in effect. Qualifying balances above $1 million do not earn any interest, with non-qualifying balances earning 0.01% APY.

Added to the product line in September 2019, Quontic’s rewards checking account (RCA) was originally called Amplify Interest Checking and earned 2.00% APY on qualifying balances up $1 million. Earlier this year, Quontic’s RCA experienced three things changes: a new name (High Interest Checking), the ACH requirement was been eliminated, and a lower rate of 1.50% APY on qualifying balances up to $1 million.

The only qualification requirement to earn the stated APY is at least 15 qualifying POS debit card transactions per statement cycle.

The High Interest Checking account has no monthly maintenance fee, eStatements are free, and the minimum opening deposit is $100. While there is no reimbursement for ATM fees, High Interest Checking customers can avoid “foreign” ATM fees by using any of,

55,000+ AllPoint® Network ATMs, 28,000+ MoneyPass Network ATMs,
7,000 SUM® program ATMs, or nearly 700 Citibank® branch ATMs.

Initial funding of a new High Interest Checking account can be done “from an existing Quontic Bank account, from an account at another bank, by ACH transfer, or by mailing us a check.” Once a High Interest Checking account is established, additional deposits can be made “through remote check deposit via our convenient Mobile App, by setting up direct deposit from your work, by mailing a check, depositing money via ACH, or by wire.”

High Interest Checking vs Online Savings Accounts

Now that most online savings account rates have fallen well below 1%, this RCA has become a very competitive alternative, but I’m concerned that the rate and/or balance cap won’t last. The only way Quontic can afford to pay this rate is from the interchange revenue generated by the debit card purchases. But that revenue only goes so far.

Let's assume a customer has $500k in a High Interest Checking account. That would earn $6,250 of interest annually. In comparison, the same $500k in a Marcus by Goldman Sachs High-yield Online Savings (0.60% APY) would earn $3,000. It takes a lot of debit card purchases to pay for an extra $3,250 of interest. Let’s assume Quontic gets 1% of interchange revenue for each debit card purchase. A customer would have to spend $325,000 annually with their debit card to pay for the interest. All that being said, I don’t have high hopes that Quontic will be able to be maintained the rate and/or balance cap.

Availability

Headquartered in New York City, Quontic Bank offers its product line online to all U.S. citizens/residents aliens, 18 years or older, who have a valid Social Security number.

Opening a High Interest Checking account can be done online, supposedly in “3 minutes or less.”

According to Quontic’s COVID-19 Business Continuity Plan,

In accordance with suggested public safety guidelines, Quontic Bank’s branch located at 31-05 Broadway, Astoria, NY 11106, will be closed as of March 17th until further notice.

Customers that need to conduct banking transactions in person can do so on an appointment-only basis by contacting us by phone, email, or filling out the form below.

Daily ATM cash withdrawal limits have been temporarily raised to $1,000 for your convenience.

Bank Overview

Quontic Bank has an overall health grade of "B+" at DepositAccounts.com, with a Texas Ratio of 5.56% (excellent), based on June 30, 2020 data. In the past year, the Bank has increased its total non-brokered deposits by $129.33 million, an excellent annual growth rate of 49.26%. Please refer to our financial overview of Quontic Bank (FDIC Certificate # 57807) for more details.

Quontic Bank is a young bank, which will be celebrating its eleventh anniversary at the end of the year. In late 2009, Steven Schnall, a New York real estate developer, bought the Long Island-based Golden First Bank, which was in financial trouble after only four years of being established. Schnall recapitalized the bank, brought in a new management team, and rebranded the institution as Quontic Bank. Currently the 57^th largest bank headquartered in New York state, Quontic Bank has assets in excess of $1 billion.

At Quontic’s root is “ontic,” meaning real or factual existence. The truth is that there is an extraordinary diversity of circumstances in the real and factual existence of our customers’ lives. We believe banking needs to be adaptive to those circumstances, so we ask the Qualitative and Quantitative questions that enable us to do so. Hence Quontic – an adaptive form of “ontic.” We like how it sounds and what it stands for.

How the High Interest Checking Compares

Since reward checking with maximum qualifying balances of $1 million and above are rare, I decided to include savings accounts in the comparison. Also, rather than making a comparison based on APYs/maximum qualifying balances, the following table uses the potential maximum earnings as a determinant. When compared to the High Yield Rewards Checking Accounts and Savings Accounts that are available nationwide, Quontic Bank’s High Interest Checking account offers the second greatest potential in annual earnings for a $1 million balance.

The above rates are accurate as of 9/14/2020.

To look for the best Reward Checking Account rates, both nationwide and state specific, please refer to our High Yield Reward Checking Account Rates Table page.