SoFi announced Thursday that members can take advantage of a new checking and savings account with an APY of up to 1%. Additionally, the account feature no overdraft, service, or transfer fees.
According to the press release, the APY of 1% is 33 times above the national average. To qualify for the high rate, members will need to utilize direct deposit. The APY applies to balances up to $50,000, following that, the APY falls to .05%.
Clients who don't use direct deposit will receive an APY of .25%, which is still fairly high in comparison to other accounts.
The checking and savings account, along with SoFi's suite of money management tools, is intended to be "an improved replacement for people's current bank."
The new accounts will also feature no limits on transfers between accounts, two-day early paychecks, and no ATM withdrawal fees for ATMs in the Allpoint network. There are no minimum balance requirements for either account.
The SoFi checking and savings accounts give clients access to money management tools, including automated savings and SoFi Vaults. SoFi Vaults are extensions of client accounts that allow them to set aside money for emergencies, bills, or to reach savings goals.
In addition, SoFi offers the SoFi Relay, which is a financial insights tool that connects client's accounts into one mobile dashboard. From there, clients can manage their checking, savings, and investment accounts as well as track spending and set financial goals. The tool will also monitor clients' VantageScore 3.0 credit score pulled from TransUnion credit reports.
With the announcement of the new accounts, SoFi is transitioning away from its SoFi Money program. New customers will not be able to sign up for SoFi Money, as the new banking accounts will feature many of the same money management features.
Current SoFi Money customers will be given the opportunity to upgrade to the savings and checking accounts "by answering just a few simple questions and reviewing new terms and conditions."
SoFi isn't the only financial services company to recently announce a high-yield bank account. American Express announced its own all-digital consumer checking account with an APY of 0.5%. AmEx offers a debit card with the account that earns 1x Membership Point for every $2 spent.
While SoFi doesn't provide rewards tied to a debit card, there is the SoFi Credit Card. It has no annual fee and offers cardholders 2% cash back when points are redeemed to pay down eligible debt, deposited directly into the SoFi checking and savings account, or used toward investments with the SoFi Investment account. The card earns 1% cash back when cardholders redeem points for statement credits.