USAA Bank has recently implemented a change in its policy regarding who is eligible to open bank accounts. For new customers, only those with a military affiliation are eligible to open deposit accounts. For several years USAA Bank was allowing anyone in the country to open a deposit account. However, it hasn’t always been open. When I first started to report on USAA Bank eight years ago, the military affiliation was also enforced.
Thanks to the reader who emailed me news of this policy change. I have also confirmed this change by calling USAA. According to the USAA CSR, new customers must have some military affiliation to open a deposit account. That affiliation can include being an active military member, being a veteran or having a family member who is a USAA member. Those who already have a USAA deposit account are grandfathered in. Even if existing bank members don’t have a military affiliation, they can remain with USAA and open new deposit accounts just like they have in the past.
I also asked if existing bank members who don’t have a military affiliation can deposit checks using their PCs or smartphones. These features are called Deposit@Home and Deposit@Mobile. There has been a long-held policy that to use these features, the member must be eligible for USAA auto or property insurance. This essentially limits these features to members with military affiliation. According to the CSR, this is still the case.
Although this news is disappointing, it’s probably not a major issue for most savers who don’t have USAA accounts. The bank does offer a nice free checking account with many perks, but the other deposit accounts don’t have much to offer. Currently, the interest rates aren’t competitive compared to rates at other internet banks. For example, its 5-year Jumbo CD has a yield of only 1.11% (as of 9/17/2013). That hasn’t always been the case. In 2011 USAA Bank was offering some competitive Jumbo CD rates.
It is important to remember that USAA is not a credit union. It’s a bank, but they now act like a credit union in limiting who can open accounts. Just like Navy Federal Credit Union, you must have a military affiliation to be eligible to join. However, there are several credit unions which make it easy for all to join. One noteworthy example is Pentagon Federal Credit Union. Anyone can join PenFed by joining an association. Based on recent news, these all-access credit unions may become less common.