A couple of months ago Ally Bank disabled a useful feature from its online CD management section. This section of Ally Bank’s online account management allows customers to control several aspects of their Ally CDs including renewals, interest disbursement and early withdrawals. The early withdrawal feature was especially useful for No-Penalty CDs. It made it possible to quickly close a No-Penalty CD and transfer the funds (the principal and all the accrued interest) into your Ally savings, checking or money market account. You could also transfer the funds to an outside linked account. Transferring the funds to an Ally account allowed the transfer to be immediate. Being able to quickly close a No-Penalty CD and transfer the funds into a liquid account enhances the appeal of no-penalty CDs.
When customers now enter the early withdrawal section of Ally’s online CD management section, the following message has been displayed since September:
We’re only processing early withdrawals by phone right now.
Call us at 1-877-247-2559. We’re here 24/7.
Ally claims it’s only temporary
There have been claims that this change is permanent. According to my contact at Ally Bank, this change is only temporary. Below is the response from my Ally contact regarding this change:
Ally Bank offers service that is unique in the industry, and we take our customer commitment seriously. We constantly balance both convenience and security measures, and have temporarily taken our CD close and ACH transfer feature offline to strengthen the security for our customers. We intend to reintroduce the capability within a few months. In the meantime, with just a call, Ally’s customer care team can complete the same process on behalf of our CD customers in under five minutes. It’s always a good idea to check the wait times – posted online and on the mobile app –prior to calling.
I’m not sure why it’s taking Ally so long to strengthen the security of this feature. Closing a CD and transferring funds to an external account would be done to a verified linked account just like when you initiate an ACH transfer from your Ally savings or checking account. The online early withdrawal feature also allowed customers to transfer funds to their Ally savings or checking account. That doesn’t seem to be an activity that would have security issues.
On the other hand, I don’t see much benefit that Ally would be receiving by making this change in the current environment. I would assume the vast majority of customers who have Ally CDs have rates higher than rates that are now available. You would think in this environment with very low rates and a large surplus of deposits, Ally would make it easier for customers to close CDs. If rates were rising, Ally would then have a reason to make it harder to close CDs early.
Early CD closures can still be done with help from CSRs
It should be noted that Ally customers still can close their CDs early, but currently, you have to reach an Ally customer service representative. According to Ally’s messages, this requires the customer to call Ally by phone. Readers have also reported being able to close CDs via Ally’s online chat service. DA reader Buckeyes shared his experience closing his Ally No-Penalty CD in the DA Forum (Thanks Buckeyes!)
Ok so Ally has closed my NP CD and the money has been sent to my online savings account. So to summarize my experience, I closed this with a 20 min online chat yesterday. Somehow I was first in line. It took almost exactly 24 hours for the CD to close. So although you cant do yourself, you can do via chat, or a phone call if you wish, and it took them 24 hours via the online chat route to close it. So a bit of a pain but it could be worse. Hope this info helps.
Online account management has been one of the fortes of Ally. Many of the other online banks (especially the smaller ones) have limited capabilities on what the customer can control via their online account platform. I hope Ally is serious about restoring this online early withdrawal feature.