Discover Bank review

Discover bank review

Nina Godlewski

BLUEPRINT

Updated 12:41 p.m. UTC July 22, 2024

Blueprint Rating

What you should know

Discover credit cards first rolled out in 1985 and, 15 years later, Discover Bank was officially born. Today it’s one of the largest banks in the nation, with more than $136 billion in assets and a digital suite of credit cards, loans, savings and checking accounts.

You won’t find a physical branch, but you can discover more than 60,000 fee-free ATMs in its network and access your account via its app or a web browser. Its accounts have few fees, its deposit yields are generally competitive and your funds here are guaranteed by the Federal Deposit Insurance Corp. (FDIC).

Pros

Accessible saving rates
Few fees
24/7 support
Well-rated mobile app

Cons

Online only
High minimum deposits for some accounts
No out-of-network ATM fee reimbursement
Only traditional CDs available

Discover Bank basics

Checking accounts: Discover® Cashback Debit Checking.
Savings accounts: Discover® Online Savings Account.
Money market accounts: Discover® Money Market Account.
Certificates of deposit (CDs): Discover® Certificates of Deposit offer 12 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.

Annual percentage yields (APYs) and account details are accurate as of July 18, 2024.

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 Checking account offers customers 1% cash back on up to $3,000 in debit card purchases (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 4.25% 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 4.00% APY for balances under $100,000 and 4.05% APY for balances of $100,000 and over. There are no monthly maintenance fees and while many of the best money market accounts require a minimum deposit, this account does not. Additionally, once you open it, 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.

You’ll need a minimum deposit amount of $2,500 and there are penalty fees for removing funds before the agreed-upon maturity date.

Discover CD early withdrawal penalties
Term	< 1 year	1 year to < 4 years	4 years to < 5 years	5 years to < 7 years	7 years to 10 years
Penalty	3 months simple interest	6 months simple interest	9 months simple interest	18 months simple interest	24 months simple interest

Other accounts

Discover offers a wealth of credit card options, plus personal loans, student loans, mortgages and retirement accounts.

Both the traditional and Roth Discover® IRA Savings Account have a 4.25% APY and don’t require a minimum opening deposit. Discover® IRA Certificates of Deposit 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 the Capital One Kids Savings Account — and a few more ATMS (70,000 at Capital One vs. 60,000 at Discover Bank).

Discover Bank vs. Ally Bank

If you’re looking to earn interest on your checking account rather than getting cash back, take a look at Ally. You can earn 0.10% APY on balances under $15,000 and 0.25% APY on balances of $15,000 or greater on the Ally Bank Spending Account and 4.20% APY on all balances on the Ally Bank 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 a 4.25% APY on the American Express® High Yield Savings Account.