Review of Scottrade Bank Free Checking Account


It has become common for brokerages to offer free checking accounts. These provide another option for those who want to leave their megabank. Last year the brokerage firm Scottrade launched Scottrade Bank to offer deposit accounts to it brokerage customers. According to last year's press release the bank was rolled out to only certain parts of the nation. I just confirmed that customers in any state can now open accounts. The bank offers checking and savings accounts, and CDs. However, the checking account will probably be the only account that's appealing to most people since the interest rates are so low. The interest rates are only listed for customers when they're logged in. The customer service representative (CSR) provided me the rates of the savings account. Since they're so low, I'll only provide the high-tier rate: 0.13% for balances from $100K up to $250K (as of 4/11/2012).

If you have a Scottrade brokerage account, Scottrade Bank and its free checking account may allow you to dump your local bank. The only reason that you may still need a local brick-and-mortar bank is for cash deposits. Below are some of the important features of Scottrade Bank's checking account:

  • No monthly service fees
  • Free ACH funds transfers
  • Free online bill pay
  • Free checks and ATM/debit card
  • ATM fee reimbursement program
  • FDIC insurance

The ATM fee reimbursement program provides unlimited ATM fee refunds for cash withdrawals. There are no refunds for currency exchange fees.

Before you can open a Scottrade Bank account, you must first have a Scottrade brokerage account. The brokerage account requires an initial deposit of just $500 for all of our brokerage account types, but they do not require you to maintain a minimum balance.

New account bonuses are common at brokerages. Currently, there isn't anything that great at Scottrade. One minor bonus is a ReferALL promotion. If you are referred by a friend or relative to Scottrade, you will both receive three free online trades. These free trades are good for up to six months. They are also currently offering a promotion to reimburse the transfer-out fees charged by other brokerages when you transfer to Scottrade. They will reimburse transfer-out fees up to $100 for transfers of $10,000 or greater.

Scottrade Bank is a sizeable bank with over $12 billion in deposits. It has an overall health score at of 5 stars (out of 5) based on December 2011 data. Please refer to our financial overview of Scottrade Bank for more details. The bank has been a FDIC member since 2008 (FDIC Certificate # 58656).

How Does The Checking Account Compare

Other popular brokerages that offer free checking accounts include TD Ameritrade (Online Cash Services), Fidelity (Fidelity Cash Management) and Charles Schwab (Schwab Bank High Yield Investor Checking). All of these offer FDIC-insured accounts, no monthly fees, free checks and ATM fee reimbursements. Your decision about which one to choose will probably be based on the brokerage features rather than the checking features.

Related Pages: checking account


Anonymous   |     |   Comment #2
ING has sold ShareBuilder to Capital One. I think ING Direct was part of the deal but am not certain.
Anonymous   |     |   Comment #6
I have been a scottrade customer for over 10 years. I took them up on their advertisement to open a checking account. Big Hassle! Not worth it. Despite being a long time customer, they needed to see proof of identification, including a utility bill. When I brought that into the nearest branch (almost 20 minutes away) they then told me I needed to bring in my Social Security card or a 1099 with my social on it. When I told them I could only provide the 1099 I received from my Scottrade brokerage account (I am a stay-at-home mom), they said they couldn't accept that one.

Going online into my account, they suggest transferring money to my new checking accout and sent a debit card to my home address. However, they won't let me transfer money from my brokerage to my checking account.

To sum it up, Scottrade Bank doesn't seem ready to handle regular online banking. Here I thought it would be a logical place to open a checking account, but it was a pain to a ridiculous extent.
anoncc   |     |   Comment #14
I've had accounts with scottrade for many years now and had no problems of any kind. They always reimburse. Transfers work like they should. They have reason, I suspect to question previous commenter because he/she is full of s***.  
Dave West
Dave West   |     |   Comment #16
I had the opposite experience. I opened a Scottrade checking and savings account without having to show any documentation. It is quite simple to transfer money between checking, savings, and brokerage margin account online with a few clicks.

The customer service has always been second to none, but I did have a multiple 7 figure trading account with them.
Anonymous   |     |   Comment #7
According to Scottrade web site it is possible to tranfer money between any internal Scottrade accounts (checking , brockerage, ect) and between Scottrade checking and any external account (different bank). 
Victor P.
Victor P.   |     |   Comment #8
I opened Scottrade Checking specifically for using ATM for withdrawal foreign currency abroad.  I was informed that they are not charging foreign transaction fees and operates the same way as Charles Schwab Bank.  A month ago I used it in Italy 3 times.  At the same time I used two other cards with the same options: Capital One and Charles Schwab.  All Scottrade transactions rates were exactly 1% higher than Capital One and Charles Schwab rates.   
Rickenbacker108   |     |   Comment #17
Interesting and relevant to our situation.  My son goes to BA Argentina often.  Local banks charge their own ATM fees--and also pay offer only the official exchange rate. If you use your bank card there to buy something you will get a local bank charge for the foreign transaction regardless of you US arrangements.  Given our circumstances and convenience of Scottrade, I'll stomach the slightly higher foreign fees.

Regarding customer service in general, I have nothing but good things to say about Scottrade. I have been a customer for 20+ years. There margin rates are absurd, but they can do things that other brokerages can't do--like do a funds XFER to any payee you designate. My main account is with IB. They are the real deal, but will not allow you to wire $$$ to any account unless it is one of your own!
Anonymous   |     |   Comment #9
In response, to the abroad ATM fees, and Trasaction rates. Was Scottrade better than Schwab and Capital one
Anonymous   |     |   Comment #10
In my experience Charles Schwab has a very solid checking account.  Foreign Transaction Fees and ATM fees do not exist (verified by use) and real people answer the phone 24 hours a day, real people like financial advisors that know what they are talking about.  As someone who does a lot of international travel I highly reccomend their services.
O.L.   |     |   Comment #11
Regarding Schwab checking, I have had the same experiences as the other posters.  No foreign transaction fees or ATM fees when used abroad.  Schwab has a good interest rate and will let you see canceled checks (front and backside imges) online.
Anonymous   |     |   Comment #12
Closed my account with Scottrade Bank today because it's been over a month and I never received a debit card. I called them a week ago, and they said I was supposed to request one. Request a debit card??? Why wouldn't that be automatic? Then they said it could take 3-5 days to get it... wrong again... Somebody is definitely asleep at the wheel. The brokerage couldn't even contact their own banking representatives. What a joke. 
TheDude   |     |   Comment #15
I just opened an account but mostly so I can transfer money out of my brokerage account into an external checking account.  I did't want a debit card.
Anonymous   |     |   Comment #13
Was gonna open account but if it's a hassle in the city, what will it be like in the country. ?
Lori Lee
Lori Lee   |     |   Comment #18
Open an account on line.
Scottrade Sucks
Scottrade Sucks   |     |   Comment #20
You can open an account online, but you have to be able to scan your documents and send them in. I recently opened an account and it was a terrible hassle. I don't have a scanner or a printer, so I had to get someone to print the huge pile of documents for me. I had to fill out the documents and drive more than an hour to turn them in at the brokerage office. After you turn in your documents asking for a bunch of personal information, you have to make several phone calls verifying your documents. I was lucky that I recently quit my job or I would have never had the time to open a bank account. I had to make two trips to my brokerage. I don't totally blame Scottrade for the inconvenience. They have to follow government mandated rules. I wish I could just keep my money under a mattress, but it would be too much trouble to pull all of it out of my brokerage account. I may as well just keep my money in the bank, so I don't end up on a no-fly terrorist watch list.

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