This article will let you in on checking accounts, both in the land based banks, and in the online banks. Well, basically, both categories are same, because virtual banks and land based banks have physical buildings, established somewhere on the globe.
Anyhow, to start off, let’s see what a checking account is. Later, we’ll see what kind of services does an online checking account is capable of providing.
Checking Account – Basic Explanation:
Checking accounts are accounts that are loaded with the facility of withdrawing cash whenever it is needed. So if you’re the kind of person who needs to withdraw money on regular or frequent basis, the checking account can help you with this kind of deal. Likewise, you can also make deposits in the checking account, with a slight variation in benefits from bank to bank.
Now when we talk about online checking accounts, there banks and accredited institutes that provide the same facilities with a twist. Let’s take Payoneer as an example here. Payoneer provides a checking account that can help you to withdraw money. As an online bank, the checking account offer is candy wrapped in a very enticing manner.
For instance, you’re offered a Free Debit Card as a new customer at Payoneer platform. However, the as per the regulations of the main bank that heads Payoneer, a “small” first time cash load fee of $24 is deducted without the user’s consent. On top of that, there’s a maintenance fee of $1 to $3, which is deducted on monthly basis.
The purpose of stating Payoneer checking account as an example was to illustrate how banks deduct fee, despite of trying to make their offers unique and intriguing to first timers. Regardless of what kind of online bank you’re willing to deal with, there’re some rules and precautionary measures that need to be adhered to:
Fee Structure and Hidden Charges:
Is the online checking account absolutely free of cost? Does the online bank deduct fee on each withdrawal or, does it deduct fee on bi weekly or monthly terms? These are the things that need to be taken care of BEFORE signing up for a checking account at any online bank.
Did You Assess The APY Factor?
The APY, or the Annual Percentage Yield, points to a specific percentage of interest that’s accrued as form of a fee or total profit on annual basis. So in case of a profit, you should open an online checking account that has a higher APY percentage – it just makes sense.
Are They FDIC Insured?
FDIC insurance matters a lot whenever you’re opening an account. Despite of the cash incentives that some online and land based banks offer, FDIC insurance is a non-negligible factor. In case the bank goes out of business, FDIC regulations are always there to help you recover your money.
In the end, it sounds like a solid advice to consult other financial experts and existing clients before considering opening a checking account with the bank of your choice. Trust us; it’ll save you a lot of hassle in the near future.