BankDirect Review: Low-Fee Online Banking and Competitive Interest Rates for Higher Balances

GOBankingRates Score

4.4
Quick Take: BankDirect products are limited to deposit accounts. But if you're looking for an online financial institution to do basic banking without sacrificing competitive rates on higher balances, BankDirect is worth considering.
  • Mobile App/Digital Experience
    4.0
  • Fees
    4.5
  • Accessibility
    4.5
  • ATM Availability
    4.5
How did we calculate this?

Pros

  • Competitive rates based on your balance or CD term length
  • Telephone banking
  • Extensive free ATM network and four out-of-network fee reimbursements per month
  • State-of-the-art security
  • Serves customers in all 50 states

Cons

  • No physical branches
  • Low ATM withdrawal limit per day
  • No weekend customer service
  • New accounts must be opened through Texas Capital Bank

About BankDirect

BankDirect is an online-only bank with no physical branch locations. It was founded in 1999 to give customers the convenience of banking whenever they want, from wherever they want. The financial institution is headquartered in Dallas and serves as Texas Capital Bank’s national internet division.

As such, it serves customers in all 50 states and makes the GOBankingRates list of best money market accounts. This BankDirect review takes a detailed look at the bank’s products and services to help you decide whether this might be the right bank for you.

BankDirect Products

All the products BankDirect offers are deposit accounts, meaning you won’t find credit cards, loans or investing options. But you can use some savings products as individual retirement accounts.

Checking Accounts

BankDirect offers two simple, straightforward checking accounts — a free Smart Checking account and Checking with Interest, which offers an APY of % to 0%, depending on the balance tier. Both accounts come with a free Visa CheckCard and free bill pay.

There is no minimum opening deposit for Smart Checking. However, if you’d like to open the interest-bearing Checking with Interest account, you’ll need to start with at least $500. Be sure you can maintain an average daily balance of $2,500 or you’ll be assessed a $15 monthly service fee.

Besides the monthly fee, BankDirect charges a $5 monthly inactivity fee after just 90 days, so be sure you’ll be actively using the account.

Savings Account

There’s just one savings account at BankDirect, but it provides everything many customers are likely to need. It requires a fairly steep $500 minimum opening deposit, but you’ll earn 0% APY on deposits.

There isn’t a monthly service fee to worry about either, but federal law limits withdrawals to just six per month. Luckily, ATM transactions don’t count against the limit. However, keep in mind that you’ll only receive reimbursement for four ATM fees of up to $2.50 each month.

Money Market Account

You don’t need to invest an arm and a leg to just open a money market account at BankDirect. The competitive rates and minimal requirements are part of the reason the online bank ranked in fourth place in the latest GOBankingRates Best Money Market Accounts study.

There’s no minimum opening deposit required and you could earn interest of 0% APY on balances of $10,000 or more. What makes a money market account unique is the ability to write a limited number of checks. You’ll receive 40 checks free on your first order to get started.

Keep in mind that money markets are considered savings account products and have the same limitations of six withdrawals per month. However, BankDirect does not include ATM withdrawals as part of the six-withdrawal Regulation D limit.

CD Rates

If you plan to save $10,000 or more for a specific period of time, a certificate of deposit might be the way to go. BankDirect CDs come in a variety of terms with rates between 0% and 0%, and you have flexibility in determining how to use the interest that accrues.

However, you might earn higher interest with one of BankDirect’s other accounts unless you elect the terms of 12 to 24 months for the maximum rate.

BankDirect Best Features

GOBankingRates scores financial institutions on several criteria to identify which ones are the best-performing. BankDirect scored highest on the following four categories.

Mobile App

Although the BankDirect mobile app receives average ratings from users, it provides all the functionality you’ll need when physical banking isn’t available. You can set up alerts such as notifications of when direct deposits arrive, deposit checks straight from your smartphone, pay bills and manage your accounts.

Accessibility

BankDirect is Texas Capital Bank’s national internet division, offering banking services to individuals nationwide. There is no minimum to open its basic checking account, and most of the accounts have no monthly service fee.

Fees

The minimal fees are one of the best features of having accounts with BankDirect. If you don’t plan on making too many ATM withdrawals outside of the 55,000 free ATMs available, you can rest assured that the first four fees will be reimbursed. And besides the interest checking account, the remainder of deposit accounts don’t have monthly service fees.

ATM Availability

Online banks rely on ATM access as an alternative to physical branches. BankDirect makes it possible to withdraw cash from any of its partnering 55,000 free ATMs nationwide. If you make withdraws outside of the network, the bank will reimburse third-party fees of up to $2.50 for the first four transactions per month.

Editor’s Favorite

Although BankDirect’s money market account is award-winning as #4 in the annual GOBankingRates study, the best thing about BankDirect is its very competitive rate of 0% on CDs with terms of 12 to 24 months.

Banking Experience

BankDirect makes branch-free banking easy, with digital banking and bank-by-phone services you can use for nearly any task you’d typically perform in a branch location. Cash deposits are the exception — you’ll need to use an ATM for those.

Customer Service

Customer service availability is one of BankDirect’s weakest links. Representatives are only available from 8 a.m. to 6 p.m. CT from Monday through Friday. There’s also no live assistance on weekends or bank holidays.

However, you can request assistance using the secure messaging system accessible by logging in to online banking.

Accessibility/Branch Availability

Because BankDirect is an online financial institution, there are no branches. But in addition to online banking and bank by phone, you can bank at over 55,000 surcharge-free ATMs.

Mobile & Digital Experience

You can use mobile and online banking for paying bills and performing nearly any transaction that involves managing accounts — initiating a wire transfer or viewing statements and transactions, for example. Digital check deposits require use of the mobile app, which is available at the App Store, where it has a rating of 3.4 out of 5 stars and on Google Play, where its rating is 3.2 out of 5 stars.

Convenience and Ease of Use

The account-opening process is slow and old-school — surprising for an online bank. Once you’re past that, the online and mobile banking apps let you bank any time, from any place you happen to be.

How To Open an Account

It is not currently possible to open an account on the BankDirect website. In September of 2022, the BankDirect site will be redirected to Texas Capital Bank’s online banking site.

Current BankDirect accountholders can access their accounts by logging into BankDirect until that time, when they will also need to navigate to the Texas Capital Bank website and use their BankDirect credentials to access their account.

Customers interested in opening an account with BankDirect should visit the Texas Captial Bank website, navigate to the account they would like to open, and select “Open an Account.” From there, you will be prompted to enter your personal information — such as your Social Security number, government-issued ID and income information — and details on funding your new account.

Fees

Although most BankDirect accounts have no monthly service fees, there are some bank fees you should be aware of.

TYPE AMOUNT
Monthly Maintenance Fees $15 for Checking with Interest, waived with $2,500 minimum daily balance
Overdraft/Nonsufficient Funds Fee $45
Overdraft Protection Transfers $0
Wire Transfer Domestic and international outgoing: $35
Non-DirectBank ATM Fees $2.50 after the first four
Excessive Transactions $2-$10
Inactivity Fee $5 for month with no activity on Checking with Interest account in previous 90 days

BankDirect vs. Competitors

Before you decide whether to bank with BankDirect, see how it stacks up against some competing online banks.

Bank Best For
BankDirect High-yield money market account
Ally Bank Comprehensive range of financial products and services
iGObanking High-yield savings account
Axos Bank Rewards accounts

BankDirect vs. Ally Bank

Ally is a one-stop shop for all your financial needs, including investment, home, auto and personal loans and investing. BankDirect focuses on deposit accounts only, with no options for loans and credit cards.

BankDirect vs. iGOBanking

The iGOSavings Plus account from iGOBanking comes out way ahead of BankDirect’s standard savings account in terms of interest — 0% on balances under $25,000 at iGOBanking vs. 0% at BankDirect. The scale shifts in BankDirect’s favor when it comes to account types — namely, IRA CDs, which iGOBanking doesn’t offer.

BankDirect vs. Axos Bank

It’s tough for most banks, including BankDirect, to compete with Axos Bank’s Rewards Checking, which pays as much as % APY, or with its selection of accounts overall.

However, user-friendliness can make or break the online banking experience, and BankDirect has the edge there. Online banking information, for example, is much easier to find because it’s linked directly from the BankDirect homepage, whereas you must navigate through a couple of layers of Support pages to find the same information on Axos.com.

Final Take

BankDirect takes a back-to-basics approach in terms of the accounts it offers, but it presents them on a mature digital platform the bank has had over 20 years to perfect. However, be aware that the BankDirect platform is transitioning to the Texas Capital Bank website in September 2022.

BankDirect FAQ

Some of the most common questions that weren't covered in the BankDirect review are listed below.
  • Is BankDirect FDIC insured?
    • Yes. BankDirect deposit accounts are insured up to $250,000 per depositor by the Federal Deposit Insurance Corp.
  • Do BankDirect customers receive checks?
    • Checks are available by request for the checking and money market accounts. The first set you order is free.
  • How do customers get cash?
    • Customers can withdraw cash from any PULSE, Cirrus or ACCEL/Exchange ATM.
  • Is BankDirect secure?
    • Yes. BankDirect uses state-of-the-art technology and best practices to secure your accounts and your personal information.
  • Does BankDirect offer free money for signing up for an account?
    • At present, there are no promotions offering free money for signing up for an account.

Cynthia Bowman contributed to the reporting for this article.

Rates are subject to change; unless otherwise noted, rates are updated periodically. All other information on accounts is accurate as of Aug. 23, 2022.

Editorial Note: This content is not provided by any entity covered in this article. Any opinions, analyses, reviews, ratings or recommendations expressed in this article are those of the author alone and have not been reviewed, approved or otherwise endorsed by any entity named in this article.

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About the Author

Daria Uhlig is a personal finance, real estate and travel writer and editor with over 25 years of editorial experience. Her work has been featured on The Motley Fool, MSN, AOL, Yahoo! Finance, CNBC and USA Today. Daria studied journalism at the County College of Morris and earned a degree in communications at Centenary University, both in New Jersey.
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