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Bank of Internet USA
1.25%-$150kBank of Internet USARewards Checking
Accounts mentioned in this post. Rates as of May 6, 2016.

BofI Federal’s Affinity Group Rate Premium Ends - Rewards Checking Still a Good Deal?


I first reported in April of several good deals that were offered by BofI Federal Bank’s affinity groups. One of the best deals was a rate premium of the Rewards Checking account. It paid 1.50% APY on balances up to $150K. The standard yield is 1.25%. That premium has recently ended. There’s no longer any advantage of opening the accounts through the affinity groups.

Even though the 1.50% yield has ended, the standard 1.25% APY on balances up to $150K remains a good deal compared to internet savings accounts and other reward checking accounts.

BofI Federal Bank’s division, Bank of Internet USA, has been offering this Rewards Checking account with a 1.25% APY for more than two years. I first reported on it in July 2011. The only change that has been made was last March when they added a $150K balance cap. The portion of the balance above $150K will no longer earn interest.

Like any reward checking account, there are monthly activity requirements to qualify for the top rate. If all four of the requirements are met, the APY will max out at 1.25% (as of 9/6/2013). The four sets of requirements are listed in the rates tab of the BofI Rewards Checking page and include:

  • Receive direct deposits or ACH deposits each month totaling $1,000 or more
  • Pay 2 bills each month through our free online banking
  • Use your Rewards Checking Visa Debit Card at least 1 time per month for normal everyday purchases
  • Use your Rewards Checking Visa Debit Card at least 6 or more times per month for normal everyday purchases

Bank Overview

Bank of Internet USA was officially established on July 4, 2000. The bank is now called BofI Federal Bank. They have kept the name Bank of Internet USA, but deposit accounts held at Bank of Internet USA are FDIC insured through BofI Federal Bank.

BofI Federal Bank's financials have remained strong. Currently, it has an overall health score at DepositAccounts.com of 5 stars (out of 5) with a Texas Ratio of 7.43% (excellent) based on June 2013 data. Please refer to our financial overview of BofI Federal Bank for more details. The bank has been a FDIC member since 2000 (FDIC Certificate # 35546).

Comparing This Rewards Checking Account with Other Accounts

Most reward checking accounts have balance caps between $10K and $25K. So if you have a large savings balance and you don’t want to open multiple reward checking accounts, Bank of Internet’s Rewards Checking account is something to consider.

Two other options to consider are CDs and internet savings or money market accounts. You’ll probably need a CD term of at least 2 years to get a 1.25% APY. If you don’t want to lock up your money in a CD, savings or money market accounts would be preferable. However, you probably won’t be able to get 1.25% APY.

You currently can get 1.15% APY with Connexus Credit Union’s Y.E.S. money market account. However, this requires a $100K minimum balance and a checking account with direct deposit.

EverBank offers a special 1.10% rate on its checking and money market account, but this is only a 6-month intro rate. The ongoing rate is only 0.61%. Also, the promo rate only applies to balances up to $100K on the checking and up to $50K on the money market account.

You can get 1% APY at SmartyPig or at Palladian Private Bank. However, both have some issues to consider.

If you want a standard internet savings account from a well-established internet bank, a rate of 0.90% is probably the best you can get in today’s interest rate environment. Several internet banks offer 0.90% on their savings and money market accounts.

The above rates are accurate as of 9/6/2013.

To determine which type of account is best for you, please refer to the following rate tables:

At the top of each table, select the “filter accounts” button to change the investment amount. This allows you to find the best account for a specific balance.

Related Pages: Bank of Internet USA, San Diego, checking account

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Anonymous   |     |   Comment #1
Would a $1000 ACH transfer from another bank satisfy the first reuqirement?  Anyone have anecdotal experience?
Anonymous   |     |   Comment #4
any idea whether they will keep dropping this rate, like they did with UFB, andwithout notice