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Accounts mentioned in this post. Rates as of October 26, 2016.

Nation's Top Savings Account Rate at Bank of Internet's UFB Direct


I first reported on Bank of Internet's new division UFB Direct on August 4th. The main focus of UFB Direct is airline mileage rewards that you can earn with a checking and savings account. However, the savings account currently stands out for its interest rate. As of today, it's 1.30% APY for all balances. This is the highest rate on a nationally available savings account. There's no guarantee how long this will last, but I was told by a BofI official that they have "no current plans to drop the interest rate."

One thing that's important to note is that this new UFB Direct has no connection with the old UFB Direct. That old UFB Direct had its deposits held by Waterfield Bank which failed in March 2010. The old UFB Direct stopped operating when Waterfield was shut down.

This new UFB Direct is a division of Bank of Internet USA. Thus, deposits that you make to UFB Direct will be held by Bank of Internet. This is the oldest pure internet bank, and it has always been financially strong. It's also part of the public company, BofI Holding Inc.. Bank of Internet USA has an overall health score at DepositAccounts.com of 4 stars (out of 5) with a Texas Ratio of 12.59% (above average) based on June 2011 data. Please refer to our financial overview of Bank of Internet USA for more details. The bank has been a FDIC member since 2000 (FDIC Certificate # 35546).

Only the Savings account pays interest. Instead of earning interest, the checking account is continuously paid mileage points for certain behavior. I have more details about the mileage points in my August UFB Direct review.

As I described in my August review, you can also earn a few mileage points with the savings account. However, the most noteworthy feature of the savings account is the high interest rate.

Some of the savings account features noted at UFB Direct include:

  • 1.30% APY as of 9/16/2011
  • Minimum deposit to open an account is $100
  • No minimum balance requirement and no monthly maintenance fee
  • Free ATM card

Some of the features shared by both the savings and checking accounts include:

  • Free online banking, mobile banking, email and text messaging alerts
  • Free MyDeposit - Deposit checks instantly from the comfort of your home or office
  • Free postage-paid envelopes

UFB Direct has a bank-to-bank ACH transfer service, but the website currently doesn't provide many details. The BofI official emailed me some of the details. Unfortunately, the transfer limits are low: standard inbound and outbound limit is $2,000 daily and $5,000 monthly. Once you are with UFB Direct for 90 days and have used the standard inbound, had no NSF incidents and have maintained the account in good standing, you can fall in the standard high limit: $15,000 daily and $25,000 monthly.

Other Alternatives for High Yields

Another option to obtain a top yield on a liquid account is Bank of Internet's rewards checking account. In July I first reviewed this account. The top rate is still 1.25% APY on all balances. However, to qualify for this yield there are monthly requirements similar to the standard reward checking accounts.

How These Rates Compare

The only way to get a higher rate on a liquid account that's available nationwide is to choose a reward checking account at another bank or credit union. However, all of those reward checking accounts have balance caps. Most of these limit the top rate to balances of $10K to $25K. You can use our reward account table to find the best reward checking rates. If you don't want to worry about monthly requirements, please refer to our savings account table and money market account table.

Related Pages: UFB Direct, Reno, San Diego, savings account

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pattyb53   |     |   Comment #1
I signed up for this offer when Ken first announced the promotion. I am very happy with the product and sure hope it continues at this good rate, 1.30%, :)
Anonymous   |     |   Comment #2
I guess anything above 1% is considered "a good rate".  A local bank heavily advertised in the paper about its 1.3% rate a few months ago.  Now it got slashed twice is currently 0.9% and they don't advertise about it anymore.
Shane (anonymous)   |     |   Comment #4
Just signed up!  Best rate going and a few miles.  Nice.
Katie (anonymous)   |     |   Comment #5
Does anybody know if interest is compounded daily or monthly? I could not find this information anywhere on the website.
Anonymous   |     |   Comment #6
I wrote and asked the same question.  Was told..."The interest accrued for the Airline Rewards Savings account is compounded daily and credited to the account at the end of the month. The interest is paid in cash and the account does earn an additional 500 miles after it has been active for 90 calendar days and 500 miles after a full calendar year."   Sounds good to me!
Anonymous   |     |   Comment #7
I opened the account online around 10/16, got an email on 10/17 asking me to fax my driver's license, I did that on 10/18/11.  Haven't heard anything from the bank yet.  Today is 10/22/11.  I just called the bank, but the bank is closed for the weekend.  Nobody answers the phone until Monday.  I am worried, what if this is a scam, they got my driver's license and SSN.
Anonymous   |     |   Comment #8
to 7 REALLY ?
Anonymous #7
Anonymous #7 (anonymous)   |     |   Comment #9
Yes, stll waiting to hear anything back from UFB bank.   No one answers the phone over the weekend at UFB. Hope to hear something back tomorrow.
cant stand the wait
cant stand the wait (anonymous)   |     |   Comment #10
to 7 so what is the dealio did you hear  hope you did not get scammed
Also Anom.
Also Anom. (anonymous)   |     |   Comment #11
ufb direct's 1.30% interest is inviting, but from what I've read their customer service is terrible, withdrawals are difficult and the airline miles are next to worthless, so I'm settling for Amex's safe and reliable 1%
At Amex
At Amex (anonymous)   |     |   Comment #12
I agree with #11.  UFB's 1.3% certainly caught my attention, but I don't like the prospect of being limited in the amount of money that I can withdraw ($2000/day) at any given time.  If I need to move 100% of my money for whatever reason, then I need the flexibility to be able to do that.  Plus, what's with the $5 withdrawal charge???   The bank is already able to make money off of your account by leveraging it out for loans, etc.  There shouldn't be a fee on top of that for moving money in or out of your savings account.

And I know that the author said that the Waterfield famliy is no longer involved with UFB but something still doesn't sit right with me about their association with this bank. 

I'm currently at American Express and although I don't like the fact that they've slipped from 1.1% to 0.9%, I'm comfortable leaving it there for now given the aforementioned issues until something better comes along.  Thanks, but I'll pass on UFB.
central (anonymous)   |     |   Comment #13
Try Sallie Mae savings online accounts, 2 types with checks for withdrawal, no fees check it out. It's current rate is 1.00% right now. I've been with them for about a year really great no hassles. FDIC insured too.
$aver (anonymous)   |     |   Comment #14
@ AMEx #12.  The $5 withdrawal fee only applies to Interbank Transfers with Next Day processing.  Standard 3-day processing is Free.

Interbank Transfer- Next Day processing, per item (Incoming)


Interbank Transfer - Next Day processing, per item (Outgoing)


Interbank Transfer - Standard 3-day processing, per item (Incoming and Outgoing)


Anonymous   |     |   Comment #15
Beware and read the fine print. There is a $5 "fee" for outgoing money transfer
Anonymous   |     |   Comment #16
Rate is now .95%
Anonymous   |     |   Comment #17
The UFB rate is now .85% and the difference between BoI MMA, High Yield Savings and Senior Checking is so small that it is not worth keeping the UFB account open.
I will be closing the UFB account and moving to a much better rate from a stronger bank.