Although known for its credit cards, Discover offers full-service, online banking. It has a highly-rated mobile app, 24/7 support and its checking and savings accounts don’t have minimum balance requirements or monthly service fees.
It’s a good bank option especially if you already have a Discover credit card or you’re in the market for one. However, those who want to bank in person, at least some of the time, should look elsewhere.
Account details and annual percentage yields (APYs) are accurate as of July 27, 2023.
Discover Bank basics
- Checking accounts: Discover Cashback Debit account.
- Savings accounts: Discover Online Savings Account.
- Money market accounts: Money Market Account.
- Certificates of deposit (CDs): Discover offers 12 CD terms running from three months to 10 years with a minimum required deposit of $2,500.
- Other accounts: Credit cards, personal loans, mortgages, student loans, Roth and traditional IRA Savings accounts and IRA CDs.
- Bank branches or online only: Online-only.
Pros
- Accessible saving rates: Discover’s savings account has 4.30% APY and no minimum deposit, making it highly accessible for anyone looking to start saving.
- Few fees: Many Discover’s accounts have no maintenance fees or insufficient fund fees, and there are over 60,000 fee-free Discover ATMs nationwide.
- 24/7 support: When you don’t have a physical bank branch to go to customer service is vital. Discover offers customers 24/7 U.S.-based customer service via phone. Discover consistently earns top marks from independent reviewers on customer satisfaction.
- Well-rated mobile app: When choosing an online bank, the mobile app is one of the top things to consider. Discover’s mobile app earned a 4.9 star rating with over four million downloads in the Apple App Store and 4.6 with over 10 million downloads in the Google Play Store.
Cons
- Online only: If you like to have a bank branch, then Discover Bank isn’t for you. While its online banking experience is highly-rated, that can’t replace the experience of interacting with bank experts at the branch if that’s what you prefer.
- High minimum deposits for some accounts: If you want to open a money market account or CD, you’ll need a minimum of $2,500 upfront.
- No out-of-network ATM fee reimbursement: If you wander outside of Discover’s ATM network, any applicable fees will come from your pocket; Discover doesn’t do any ATM fee reimbursement.
- Only traditional CDs available: Discover doesn’t offer no-penalty, bump-up, step-up or jumbo CDs.
About Discover Bank
It’s in the top 30 largest banks in the nation by assets and Discover Bank is covered by the Federal Deposit Insurance Corp. (FDIC), which protects your deposits up to $250,000.
Checking accounts
The Discover Cashback Debit account offers customers 1% cash back on up to $3,000 purchases each month. See website for details. Plus, the account has no monthly fees or balance requirements, no fees for insufficient funds, no fees to use the automated bill pay service and offers early direct deposit, which allows you to access your paycheck up to two days early.
Learn more: The best free checking accounts.
Savings accounts
The Discover Online Savings Account offers a 4.30% APY with compounding daily interest, no fees and no minimum opening deposit. This makes it a good option for anyone looking for a high-yield savings account.
Money market accounts
The Discover Money Market Account offers 4.20% on balances under $100,000 and 4.25% for balances over $100,000. There are no monthly maintenance fees, but the minimum opening deposit of $2,500 may make you pause. Many of the best money market accounts have lower requirements. Once you open it, however, you don’t need to maintain any set balance.
The account provides a debit card and checks, and there aren’t any fees if you go over the limit of six transactions a month, though Discover reserves the right to close the account or change it to a checking account if you consistently have excess transactions.
Certificates of deposit (CDs)
If you’re looking to lock-in longer-term savings, CDs are a good option. There are 12 term lengths for customers to choose from at Discover: three months, six months, nine months, 12 months, 18 months, 24 months, 30 months, 36 months, 48 months and 60 months. And Discover was one of our winners for best CDs.
Like the money market account, you’ll need a minimum deposit amount of $2,500 and there are penalty fees for removing funds before the agreed-upon maturity date.
Other accounts
Discover offers a wealth of credit card options, plus personal loans, student loans, mortgages and retirement accounts.
Its traditional and Roth IRA Savings accounts have a 4.30% APY and don’t require a minimum opening deposit. Discover’s IRA and Roth IRA CDs offer the same rates as its traditional CDs. To invest though you must be within the limits set by the Internal Revenue Service (IRS) and have taxable earned income.
How Discover Bank stacks up
Discover Bank vs. Capital One 360
Discover Bank and Capital One 360 offer similar deposit accounts with competitive rates, no fees and no minimum opening balance. Capital One, however, offers a few more account options, including a kid’s savings account and a few more ATMS (60,000 at Discover Bank vs 70,000 at Capital One).
Discover Bank vs. Ally
If you’re looking to earn interest on your checking account rather than getting cash back, take a look at Ally. You can earn 0.25% APY on the Ally Spending Account and 4.00% APY on the Ally Online Savings Account.
And while the two banks offer many of the same products, Ally has money market accounts and CDs, plus cryptocurrency options and auto loans, which can make it a better option for an all-in-one bank.
Discover Bank vs. American Express National Bank
As online-only banks with well-known credit cards, Discover Bank and American Express National Bank are natural competitors. They offer the same types of accounts and similar rates, including 4.00% APY on the American Express High Yield Savings Account.
Frequently asked questions (FAQs)
Discover Bank is owned by Discover Financial Services.
Discover Bank offers one debit card, but you can find seven Discover credit cards from its parent company.
Discover Bank is insured by the Federal Deposit Insurance Corp. (FDIC), meaning that your deposits are protected up to $250,000.
Discover has very few fees that can apply to its deposit accounts.
