Ally vs. Synchrony: How Do They Compare?

Synchrony Bank and Ally Bank are online financial institutions that offer competitive rates and low fees on savings products. They also have highly rated mobile apps, large ATM networks and strong customer service, which are all important features when you can’t visit a branch to get help in person.

However, the two online banks diverge in some areas, such as product offerings, CD term options and customer service availability. Let’s explore how these two online-only institutions compare so you can determine which might be a better fit for you.

Ally and Synchrony quick comparison

Ally Bank and Synchrony Bank both offer competitive annual percentage yields (APYs) on their savings accounts and charge few fees. You could stash your money at either online institution and earn more interest than nearly any of the largest national brick-and-mortar banks.

However, when comparing the two side by side, Ally generally comes out ahead in a few key areas. Ally offers a checking account, auto loans and mortgages, all of which Synchrony lacks.

But if you’re looking for more CD term options or a slightly higher savings account rate, Synchrony is a strong choice.

Here’s how these two banks compare head-to-head:

When to choose Ally Bank

• You want to open a checking account.
• You’re looking for extra tools to improve your savings habits.
• You want to earn the highest yield on a CD account.
• You want the ability to withdraw from savings more frequently.
• You want to earn a higher yield on a money market account.
• You’re looking to get a mortgage or auto loan at your bank.

When to choose Synchrony Bank

• You want plenty of term options to build a CD ladder.
• You want to earn a higher yield on your savings account.
• You don’t need a checking account.
• You won’t need to withdraw your CD funds early.

Ally vs. Synchrony: Checking accounts

Synchrony Bank doesn’t offer a checking account, but Ally Bank offers one — the Spending Account — with no overdraft fees or monthly maintenance fees. Ally's Spending Account pays an APY of 0.10% on balances up to $15,000 and 0.25% on balances above that. It doesn't require an initial deposit or minimum balance.

One unique feature of the account is "spending buckets," which allow you to set aside money for different purposes. For example, you could allocate money for bills in one bucket and your spending money in another.

You can also receive your direct deposit payments up to two days early with Ally’s early direct deposit feature.

Ally vs. Synchrony: Savings accounts

Synchrony Bank has a slight edge in savings account interest rates compared with Ally, though both banks offer competitive APYs. You earn a 4.00% APY on all balance tiers through Ally and a 4.30% APY with Synchrony. Neither bank charges a monthly maintenance fee or requires an opening deposit or minimum balance.

The Ally Savings Account offers its "bucket" feature, which helps you organize your funds and earmark them for specific goals. Another tool to help you save is the Surprise Savings program. Once you opt in by connecting your checking account from Ally or otherwise, the bank analyzes your spending patterns and transfers money it thinks you won't need to your savings account.

Unsurprisingly, both online banks do not allow you to deposit cash into their savings accounts. But they let you add money to your account using electronic transfers, wire transfers, direct deposits and mobile check deposits. You may also mail paper checks to either bank.

To withdraw money, you can set up an online funds transfer or outgoing wire transfer, or request a check. Ally also has the option of telephone transfer. Meanwhile, Synchrony offers an ATM card for withdrawals, while Ally does not. Both banks limit your monthly withdrawal transactions: Ally allows up to 10 online and mobile banking transfers per month, while Synchrony limits it to six withdrawals or transfers.

When banking with Synchrony, you can use any of the 70,000 ATMs in the Accel network for free and get reimbursed up to $5 per month for ATM fees paid elsewhere.

With Ally, you can use more than 75,000 ATMs in the Allpoint and MoneyPass networks for free. Ally reimburses up to $10 per month for any domestic ATM fees you pay while using a different network.

Ally vs. Synchrony: Money market accounts

Ally Bank and Synchrony Bank both offer money market accounts, which combine checking and savings features. Ally’s Money Market Account earns 4.00% APY on all balance tiers, while Synchrony's account pays a much lower 2.25% APY on all balances.

Synchrony Bank’s money market account has check-writing capabilities and an optional ATM card for cash withdrawals and PIN purchases. However, it limits convenience transactions to six per month.

In comparison, Ally Bank limits transactions to 10 a month for its money market account, which also includes a debit card and checks.

Ally vs. Synchrony: CDs

Both Ally Bank and Synchrony Bank offer several types of certificates of deposit (CDs), which require you to deposit funds into an account for a specified term. In exchange for keeping the money locked up, you earn interest on your funds. You can open a no-penalty CD or “bump-up” CD with either bank. A no-penalty CD gives you the flexibility to withdraw your funds if needed, while a bump-up CD lets you increase the rate of your return as your CD matures.

Synchrony offers 16 CDs with terms ranging from 3 months to 5 years. Its highest APY is 4.20% for a 9-month term. Ally has fewer options — 10 CDs with terms ranging from 3 months to 5 years — but offers a higher maximum APY of 4.30% on its 6-month CD.

Both banks charge early withdrawal penalties for taking money out of your CD account early (except for the no-penalty CDs under certain requirements). Ally charges a penalty of 60 to 150 days’ interest, depending on the CD term. If you have the no-penalty CD, you can withdraw funds from the account without a penalty six days after funding it. Synchrony’s penalty is steeper: You forfeit between 90 and 365 days’ interest when tapping your account before maturity.

Ally vs. Synchrony: Customer service

Ally Bank and Synchrony Bank are both online banks as opposed to traditional banks. As such, you can't get in-person help at a branch with either institution.

Ally offers live phone support during certain hours and an online chat function. You can also email the bank or send a letter by mail.

Synchrony also provides limited live phone support. You can use the website's chat feature anytime and its automated telephone service to complete basic banking functions. No email address is available, but postal mail is an option.

Ally vs. Synchrony: Online banking and mobile apps

Because Ally and Synchrony are online banks, having reliable digital tools is important.

Both banks offer top-notch mobile apps for Apple's iOS devices. The apps include all of the features you’d hope to find, including the ability to deposit mobile checks, pay bills, set up transfers and generally manage your financial health.

The MySynchrony iOS app has a score of 4.6 out of 5 stars, while Ally’s iOS mobile app boasts a slightly higher score of 4.7.

However, both banks' apps fall short of customer expectations when it comes to the Android version: Synchrony’s Android mobile app earned a score of 2.8 out of 5 stars, while Ally’s app earned 2.3 out of 5 stars.