The days of being forced to use a mainstream financial institution to bank with are slowly but surely coming to an end. While the likes of Citi, Wells Fargo, and Chase still dominate the retail banking scene, a number of alternatives lie at your disposal.
More specifically, US consumers are becoming more drawn to what online-only banks offer, such as a seamless account opening process, free ATM withdrawals, debit card cashback, and enhanced interest on your savings.
One such example of an online-only institution that is growing in popularity is that of Radius Bank.
Launched back in 1987, the bank offers a number of core features, such as free ATM withdrawals worldwide, and the ability to earn unlimited 1% cashback on your debit card purchases. As is the case with any alternative bank, you still need to do some homework to ensure it is suitable for your needs.
As such, we would suggest reading our in-depth Radius Bank review. Within it, we’ll run you through the ins and outs of whether or not the bank is worth joining. This will cover fees, interest, ATM withdrawals, minimum balances, eligibility, and more.
What is Radius Bank?
Radius Bank is an online-only bank that was first launched in 1987. We say online-only, although the institution does have a single branch in Boston. While you are free to use the Boston branch at will, you can access all of the features offered by Radius Bank online. Nevertheless, the bank offers fully-fledged checking accounts to those based in the US.
Its checking accounts come with most of the same features as you will find with any other bank, albeit, it outshines traditional financial institutions for a number of reasons. Firstly, Radius Bank account holders are offered a highly rewarding cashback scheme on debit card purchases. This amounts to 1%, and there is no limit to the amount you can earn each month.
Secondly, Radius Bank also offers free ATM withdrawals – as long as it is a Radius Bank ATM or an ATM within the SUM℠ network. Regarding the former, these are only available in Boston. Moreover, Radius Bank also offers fee-free account withdrawals when you use the card overseas, which is great if you have a tendency to travel frequently.
Radius Bank is also a useful option if you are looking to earn interest on your savings in a risk-free manner. Through its FDIC insured CD and savings accounts, you have the chance to earn up to 2.2% APY. We’ll explore each account type in more detail further down.
Finally, it is also worth noting that Radius Bank now offers accounts to businesses and institutions. This covers both banking and financing, as well as escrow services. However, for the purpose of this review we will concentrate solely on its personal accounts for everyday Americans.
Checking Accounts at Radius Bank
The core product offered by Radius Bank is that of it’s checking account. As is the case with any checking account you consider opening, you need to make an assessment on its key features. This should include metrics such as minimum balances, fees, ATM withdrawals, and interest.
We’ve unraveled the ins and outs of the Radius Bank checking account below.
Minimum Balance
When you first open an account with Radius Bank, you will be required to deposit $100. However, there is no minimum account balance that you need to hold after this.
ATM Withdrawals
When it comes to ATM withdrawals, Radius Bank offers a headline rate of fee-free withdrawals across the US. However, upon closer inspection, there are some limitations. First and foremost, in order to benefit from fee-free ATM withdrawals, you will need to use a Radius Bank ATM, or an ATM within the SUM℠ network.
Regarding the former, you will only find Radius Bank ATMs within Boston, which is obviously no good if you live elsewhere. In terms of the SUM℠ network, this covers thousands of participating ATMs throughout the US. The network is primarily made up of smaller institutions or credit unions, although you should have no issues finding an eligible terminal.
Foreign ATM Withdrawals
One of the best features offered by Radius Bank is that of its fee-free ATM withdrawals overseas. This is applicable anywhere in the world, and there is no limit to the amount of withdrawals you can make. When you do use your Radius Bank debit card overseas, the respective ATM will likely charge you a fee and thus – this will be taken from your account balance. However, Radius Bank will then refund the fee.
Depositing Funds
You have a number of options at your disposal when depositing funds into your Radius Bank account. This includes the usual offering of bank-to-bank transfers, or at an ATM. If opting for the ATM option, this needs to be a machine that displays the NYCE® Shared Deposit Program logo. Alternatively, you can also deposit funds via the one Radius Bank branch that is based in Boston.
Interest
If you’re currently banking with a mainstream financial institution like Wells Fargo or Chase, then you will know first hand that the rate of interest on offer is a pittance. In fact, this will rarely exceed 0.1%. In the case of Radius Bank, you will earn 1% APY on your money. Although at first glance this does seem low, in comparison to major banks, this is actually very competitive.
However, you will be required to meet a few conditions to earn the 1% APY. Notably, this includes a requirement to hold a minimum account balance of $2,500, you must apply for a debit card, and elect to receive your monthly statements electronically.
Debit Card Cashback
We really like the cashback offer that Radius Bank applies to your debit card purchases. As per its headline promotion – you’ll get an unlimited amount of cashback at a rate of 1%.
However, once again, you really need to dig deep through the banks’ terms and conditions to ascertain whether or not you are eligible for the cashback offer.
Here’s what you need to know.
- Minimum Account Balance: Much in the same way as the 1% APY interest offer, you will need to maintain a minimum account balance of $2,500 to be eligible for cashback. Alternatively, if you don’t quite meet the $2,500 minimum account balance, you can instead have your employer pay your wages into the account. However, this also needs to be a minimum of $2,500 per month.
- 30 Day Rule: Before you can start reaping the rewards of the 1% cashback offer, you will need to have had your Radius Bank account open for at least 30 days.
- Eligible Purchases: Although there is no limit to the amount of cashback you can earn each month, in-store purchases must be made with a signature, as opposed to Chip and Pin. All online purchases are eligible.
- Credited Monthly: Any cashback rewards that you earn will be credited once per month.
Access Your Wages Early
If you elect to have your employer pay your wages into your Radius Bank account each month, you might be eligible for its early access feature. If you are, then you will be able to access your wages two days before they are usually paid. For example, if you receive your salary on the 25th of each month, then you can make a withdrawal on the 23rd.
Fees
You will not be charged any fees to open or maintain your Radius Bank account, which is great. However, you still need to make considerations regarding other, specific fees that you might be accustomed to. For example, you will need to pay $10 and $20 to domestically wire funds in and out, respectively. If wiring funds in and out internationally, you’ll pay $10 and $40, respectively.
For miscellaneous fees such as those linked to ordering a new card, paying in a money order, or a failed debit card payment – you are best advised to check the bank’s schedule of fees.
Overdraft Facility
If you have the required credit profile, Radius Bank might offer you an overdraft facility. Take note, if your account balance remains in the overdraft zone for five days or more, you will then begin paying a daily overdraft fee of $5.
In comparison to other online banks in the space, this is actually quite expensive. Alternatively, you might want to consider the linked protection feature offered by the bank. This allows you to link up external checking or savings accounts, which Radius Bank will then transfer funds from in the event you are about to incur overdraft fees.
Radius Bank Savings and CD Accounts
Although its checking account sits at the core of Radius Bank, it is well worth considering the savings and CD accounts it has on offer. We have broken each account type down in more detail below.
Savings Account
Radius Bank actually offers two types of savings accounts – the Radius High-Yield Savings, and the Rewards Checking.
- The Radius High-Yield Savings account pays the highest rate of the two, at 1.25% APY on balances of between $2,500 and $25,000, and 1.65% APY on balances of $25,000 or more. Once again, you’ll earn nothing if your account balance falls below $2,500, which is a shame. Moreover, the Radius High-Yield Savings account does come with certain limitations. Crucially, you will be capped to 6 pre-authorized transactions per month.
- If opting for the Rewards Checking savings account, you will earn 1% APY on balances between $2,500 and $25,000, and 1.20% APY on balances of $25,000 or more. Although the rate of interest is lower, you will not be accustomed to any transaction limits.
Both savings accounts come with a fully-fledged debit card, and you can make fee-free withdrawals as per the checking account.
CD Accounts
The second option that you have at your disposal is that of a traditional CD (certificate of deposit) account. As is the case with most banks offering CDs, the amount of interest that you can earn will depend on two key variables. Notably, this covers the length of time that you are prepared to lock your money away for, and the minimum amount you are willing to invest.
Radius Bank offers CD accounts from just 3 months, up to a maximum of 5 years. Whichever term you do opt for, the rate of interest will be fixed. This is in stark contrast the interest that comes with its savings accounts, which can change at any time.
Nevertheless, at the lower end of the spectrum, you will earn just 0.85% APY by taking out a 3 month term. You will need to invest at least $1,000 to be eligible. In order to get the highest interest rate on offer, you will need to take out a 5 year CD account. You can do this with a minimum investment of $500. This might actually be the best option for you if you are confident that you won’t need to access your cash on-demand.
Don’t forget, you need to have a minimum account balance of $2,500 across both of its checking and savings accounts to earn interest, so a $500 minimum is more reasonable in this respect.
If you do invest in a Radius Bank CD account, but you find yourself in desperate need of cash, then you will need to pay an early withdrawal fee. The amount that you pay will depend on the term of the CD. For example, a 3 month and 6 month CD will cost 90 days worth of interest, and a 9 month CD will attract a reduction of 180 days worth of interest. Anything longer than 9 months will come with an early termination fee of 365 days worth of interest.
Safety of Your Funds
While it is true that Radius Bank is not in the same league as the likes of Wells Fargo, Citi, Chase, or any other mainstream institution, you should have no concerns on the safety of your funds. Crucially, the bank is part of the Federal Deposit Insurance Corporation (FDIC).
For those unaware, the FDIC ensures that your money is protected by the US government in the unlikely event that Radius Bank went out of business. However, this is only up to the first $250,000 per institution, so you should never hold more than this amount with a single bank.
This is the case with all account types offered by Radius Bank – such as its checking, savings, and CD accounts.
Customer Support
If you need to contact a member of the customer service team, you can do this via live chat, or by calling Radius Bank directly. The main contact number is 800.242.0272, and you can access the live chat facility from the website.
The customer support team works 7 days per week, between the hours of 08:30 and 00:00 (Monday to Friday) and 08:00 and 20:00 (Saturday and Sunday).
How to get Started at Radius Bank?
If you like the sound of what Radius Bank offers, then we have outlined the step-by-step process that you will need to take to get an account for yourself.
- Step 1: Visit the Radius Bank Website Unless you are based in Boston and looking to open an account in-branch, then you will need to complete the process online. Simply head over to the Radius Bank website and click on the ‘APPLY NOW’ button.
- Step 2: Enter Your Personal Details As is the case with any banking application, you will need to let Radius Bank know who are you. This will cover your full name, home address, date of birth, and contact details. You will also need to enter your social security number, and the number pertaining to a government-issued ID (passport or driver’s license).
- Step 3: Deposit Funds In order to activate your Radius Bank account, you will need to deposit a minimum of $100. The easiest way to do this is to perform a bank-to-bank wire.
- Step 4: Apply for Your Debit Card Once you have activated your account, you will then need to request a debit card. You can do this from within your account portal, and Radius Bank will post it to your home address within a few working days.
Radius Bank Review: The Bottom Line?
In summary, Radius Bank is a great alternative to mainstream financial institutions. You can get started in a matter of minutes, and you only need to deposit $100 to get your account activated.
We really like the fee-free ATM withdrawals, which is available both domestically and overseas. You also stand the chance of earning an unlimited amount of cashback at 1%, although you will need to maintain a minimum account balance of $2,500 to be eligible .
If you’re looking to earn some interest on your savings, Radius Bank also offers a number of CD and savings accounts too. The main drawback of using Radius Bank is that you need to keep a minimum balance of $2,500 to earn interest, and you’ll be charged a whopping $5 per day if you remain overdrawn for 5 days or more.
Other than that, Radius Bank ticks most boxes.
Radius Bank
Pros
- Easy Signup Online
- Open Account with $100
- Fee-free ATM withdrawals
- Competitive Interest Rates
- No maintenance fee
Cons
- Need balance of $2,500 to earn interest
- Can’t deposit cash
