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With deposit accounts offering up to 4.50% APY, Ally Bank is a worthwhile choice if you’re comfortable banking only online since it doesn’t offer branches
From our partner, Ally Bank
Key Takeaways:
Ally has come a long way from its humble beginnings in 1919 to an online bank today that offers a vast array of financial products with low fees and competitive rates.
In this review, we at the MarketWatch Guides team take a deep dive into Ally Bank’s products and reputation so you can determine if it’s the right place to help you reach your personal finance goals.
We give Ally 4.5 out of 5 stars after evaluating factors including its branch availability, account fees, interest rates and customer support. The bank scores highest for its checking accounts, with its certificates of deposit (CDs) and overall banking experience right behind.
Here’s how the company scores in each of our review categories:
Flip Card
Ally Bank
*Ratings are determined by our editorial review team. Learn more about our scoring methodology.
Ally’s roots stretch back to 1919 when auto manufacturers had dealers maintain a large inventory of cars to keep the factories running at a regular cadence. General Motors formed the General Motors Acceptance Corp. to help auto dealers finance the purchase of multiple cars.
By 1999, after plenty of growth and expansion, the bank formed a corporate finance division and a decade later converted its banking division into the online-only Ally Bank. The company rebranded as Ally Financial in 2010 and is now a top-25 U.S. financial holding company with approximately $196 billion in assets and over 11 million customers. Ally’s auto loans division is one of the top lenders in the U.S.
If you’re comfortable with banking online, Ally Bank is worth considering. It has all the deposit accounts you could want, and all of them come with competitive interest rates. The lack of fees and minimum balance requirements are also a plus, making Ally’s accounts accessible to anyone. Having customer service support at all hours is also a positive.
We rate Ally 4.5 stars for its overall customer banking experience including ease of access to perform banking transactions and other features. Ally offers a variety of deposit accounts, including:
All of these deposit accounts are insured by the Federal Deposit Insurance Corp. (FDIC) up to the maximum allowable limit of $250,000 per depositor for each qualifying account ownership category.
In addition, Ally offers credit cards, individual retirement accounts (IRAs), investment accounts and mutual funds. You can also shop for a mortgage, auto loans or personal loans with the bank. Although Ally is a full-service bank, it doesn’t have physical locations, and you can only make deposits by transferring money from another bank or Ally account, wire transfer, mobile deposit via the Ally app or mailing in a check.
| Ally Account | APY* | Minimum Opening Deposit | Minimum Account Balance |
|---|---|---|---|
| Spending Account | 0.10% for balances less than $15,000 0.25% for balances of $15,000 or more | $0 | $0 |
| Savings Account | 4.20% | $0 | $0 |
| IRA Savings Account | 4.20% | $0 | $0 |
| High Yield CD | 3.00% – 4.50% | $0 | $0 |
| Raise Your Rate CD | 3.75% | $0 | $0 |
| No Penalty CD | 4.00% | $0 | $0 |
| IRA High Yield CD | 3.00% – 4.50% | $0 | $0 |
| IRA Raise Your Rate CD | 3.75% | $0 | $0 |
| Money Market Account | 4.20% | $0 | $0 |
Ally generally has a positive reputation as a financial institution, earning an A rating from the Better Business Bureau and receiving a rating of 5 out of 5 stars from Bauer Financial, an independent bank and credit ratings company. However, customer service ratings do not score the same high marks.
The bank’s Android app receives 2.6 out of 5 stars on Google Play, while the Apple App Store has a rating of 4.7 out of 5 stars.
In 2013, the Consumer Financial Protection Bureau (CFPB) and the Department of Justice ordered Ally Financial Inc. and Ally Bank to pay $80 million in damages for discriminatory lending practices, where it charged higher interest rates for auto loans based on borrowers’ race or national origin. We reach out to Ally for comment on this matter but did not receive a response.
Since then, Ally has implemented a diversity, equity and inclusion initiative and hired a Chief Diversity Officer. Some of the programs include the launching of an entrepreneurial program aimed at students from historically Black colleges and universities and donating millions to local communities in support of social equity, economic mobility and COVID relief.
Ally is a top choice when compared with other large U.S. banks. It offers a variety of bank accounts and can offer higher APYs than its brick-and-mortar peers in many cases.
Although it doesn’t offer the ability to bank in person or deposit cash, Ally Bank customers can access nearly three times the number of ATMs as competing banks such as Chase, Wells Fargo and Bank of America. Additionally, none of Ally’s deposit accounts have minimum opening or balance requirements.
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|---|---|---|---|---|
| Our Rating | ||||
| Savings APY | 4.20% | 0.01% | 0.25% | 0.01% |
| 1-Year CD APY | 4.50% | 0.01% | 1.50% | 4.25% |
| Number of Branch Locations | Online Only | 4,700 | 4,600 | 3,800 |
| Number of ATM Locations | 43,000 | 15,000 | 11,000 | 15,000 |
| Available Deposit Products | Checking, Savings, CDs, Money Market | Checking, Savings, CDs | Checking, Savings, CDs | Checking, Savings, CDs |
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| Our Rating | ||||
| Savings APY | 4.20% | 0.01% | 0.25% | 0.01% |
| 1-Year CD APY | 4.50% | 0.01% | 1.50% | 4.25% |
| Number of Branch Locations | Online Only | 4,700 | 4,600 | 3,800 |
| Number of ATM Locations | 43,000 | 15,000 | 11,000 | 15,000 |
| Available Deposit Products | Checking, Savings, CDs, Money Market | Checking, Savings, CDs | Checking, Savings, CDs | Checking, Savings, CDs |
*The bank offers a low fee that is waivable if at least one requirement is met, such as a recurring direct deposit, a minimum monthly balance or a linked savings account. Requirements vary by bank.
Ally could be a great option for anyone seeking a full-service bank insured by the FDIC that offers high-yield deposit accounts without any minimum opening deposit or balance requirements.
Since the bank is only online, it can offer lower fees and higher interest rates than banks with physical branches and more overhead. Those who aren’t comfortable banking online or through a mobile app or simply want to have an in-person banking experience should opt for a traditional, brick-and-mortar bank instead of an online bank like Ally.
Ally Bank is a reliable bank with all deposits insured by the FDIC up to $250,000 per depositor for each qualifying account ownership category.
The main downsides of Ally Bank are related to it being an online-only bank. You can’t do any of your banking in person and you also can’t deposit cash to your account. Someone who prefers in-person banking or frequently has to make cash deposits will find this makes the bank an unappealing option.
Deposits with Ally Bank are safe since they are insured by the FDIC. Additionally, Ally says customers will not be held liable for any unauthorized online or mobile banking transaction as long as they report it to the bank within 60 days of receiving their statement.
See how Ally stands out in our roundups of the best financial institutions and deposit products available today:
Our team researched more than 100 of the country’s largest and most prominent financial institutions, collecting information on each provider’s account options, fees, rates, terms and customer experience. We then scored each firm based on the data points and metrics that matter most to potential customers. Read our full methodology.
*Data accurate at time of publication
If you have feedback or questions about this article, please email the MarketWatch Guides team at editors@marketwatchguides.
