When it comes to institutions that specialize in digital banking, there are two popular names that are battling off being the best — it is Ally Bank vs Chime. Both offer low-fee checking and savings accounts, but, their rates, as well as account access, vary.
Through this Ally Bank vs Chime review, we are going to compare both companies in order to be able to determine which among the two is the most ideal based on your needs and preferences.
As mentioned both Ally Bank and Chime Bank offer mobile banking, which is probably the most sought after banking platform these days. Well, how could you not get into it when it offers so much convenience and ease for customers like you and me.
Mobile banking has ended changed the way banking is done. In fact, in data presented by Statista, back in 2015, “the number of digital banking users was forecast to surpass 161 million in the United States in 2019.” This number represents over twenty percent growth from 2014. According to the study, there are two factors that led to this increase in mobile or online banking. One of them is the increased prevalence of smartphones, as well as other digital platforms, and the second one is the increase or growth in financial technology firms — like Ally and Chime.
If we may just say, another reason why digital or online banking is becoming “in” is the fact that people today – especially the young generation – loves anything instant. People have changed. We now want anything that will provide us convenience or ease of use.
Don’t get us wrong, there is totally nothing wrong with that. In fact, it’s a good thing. Because that also gives us the impression that the banking industry is adapting to change.
Anyway, going back to our Ally Bank and Chime comparative review, we are going to specifically talk about the following?
- What is Ally Bank?
- What is Chime?
- How does Ally Bank and Chime work?
- What are the key features of Ally Bank and Chime?
- What are Ally Bank and Chime fees and charges?
- How is the customer service of Ally Bank and Chime?
- What are the pros and cons of both Ally Bank and Chime?
ALLY BANK VS CHIME: BRIEF BACKGROUND
First and foremost, let us talk about what these companies are. For any customer/client, it is very important to get to know the institution first before signing up or dealing with them. This will help give you peace of mind, at the same time, build trust knowing that the organization is reliable and have an awesome background to back them up.
For those who are not familiar with Ally Bank, the company actually started in the automobile industry. It’s quite interesting knowing that from automobiles, they have become who they are now – one of the most popular names in digital banking.
Anyway, General Motors Corporation established the company as the General Motors Acceptance Corporation or GMAC back in 1919. GMAC was established to help provide financing for its then growing customer base.
Just like any growing companies, eventually, GMAc expanded its operations and added functions that any traditional bank offers.
In 2009, however, GMAC’s banking unit had to change its name. It has become what we now know as Ally Bank. The said name change actually helped GMAC get back on track after going through a financial crisis.
Eventually, GMAC had to embrace a totally new name. The whole mega financial company was rebranded and named Ally Financial. In 2014, Ally Financial went public with the ticker ALLY.
Meanwhile, in 2016, the company expanded and entered into the online brokerage arena. Ally bought TradeKing, which was in the end rebranded to Ally Invest – the company’s, online brokerage firm.
Ally Bank is based in Midvale, Utah.
As mentioned, Chime Bank is an online, rather, a “mobile-only” bank that offers an alternative to traditional banking. This one’s ideal for people who tired of having to pay high fees or those who hate dealing with overdrafts.
Chime makes things convenient, needless to say, it offers its customers a streamlined service that is very understandable.
Just so you know, Chime is both a bank account and a mobile application. Once you have decided to open an account with Chime, you get both a Spending Account and a Savings Account. In addition, you will also get the Chime Visa Debit Card.
All accounts with Chime are FDIC-insured, which makes them a reliable online banking institution.
Furthermore, Chime does offer features that you will surely enjoy. This includes not having monthly minimums or fees, no overdraft fees, and most of all, it has a lot of fee-free ATMs, which definitely made it more appealing especially to the younger ones.
Now, before we continue, here’s an informative review from MissBeHelpful, a YouTube video creator regarding Ally Bank and Chime Bank. Watch the video by clicking below play button:
ALLY BANK VS CHIME: HOW IT WORKS
This time around, let’s look into how both Ally Bank and Chime Bank work. This will give you an idea which between the two institutions is more convenient for you.
The primary reason why a lot of people choose Ally Bank over other mobile or digital banks is that it offers relatively high-interest rates. Sounds good?
Apart from that, Ally Bank does not charge fees like monthly maintenance fees to its customers. More so, it does not also require minimums on any of the accounts they offer. No wonder why Ally Bank is very much appealing to small investors.
Ally Bank is FDIC-insured, which basically means, each depositor is protected for up to $250,000. Note that not all mobile or digital banks are FDIC-insured. Thus, knowing that Ally Bank is FDIC-insured means you can sleep at night peacefully knowing that your money is safe.
Signing up with Ally Bank is easy. All you need to do is provide your personal information, which includes your Social Security number. In addition, you will also need to answer questions, which is in compliance with the PATRIOT Act.
Going through the whole signing up process is not painful at all. Also, another thing that we like about Ally is that should you decide to open another account, you will no longer have to go through the same process. The bank will basically just pull your information off from their database – which makes it really convenient.
Chime Bank is very straightforward. Basically, all those who will sign up will have access to a checking account, which Chime calls as Spending Account; a savings account, and lastly, a debit card.
Initially, all the money deposited in your Chime account will go directly to your checking account. This allows you to use the money to make everyday purchases using your debit card. You also have the option to use it online just like a standard checking account to send money, or you may use it to write paper checks using the Chime Checkbook app.
Just like any online banking account, your money from your checking account can also be transferred to your savings account giving you the option to keep it there or set up an external transfer account. Don’t worry about charges as there are no fees charged for transferring cash.
ALLY BANK VS CHIME: KEY FEATURES
While both Ally Bank and Chime Bank seem to have similarities, it is also important to note that the two are still different from one another. One of the bases on that is the key features they both offer. Let’s take a look at them.
Ally Bank offers a wide variety of financial services like a savings account, checking account, money market, as well as certificates of deposit. In fact, you can open different bank accounts either for everyday use or for long-term savings.
Since it’s an online bank, it’s pretty obvious that Ally is accessible using either your smartphone or your laptop. Ally Bank’s mobile app is available for both iPhone and Android users.
Furthermore, Ally Bank offers ATM reimbursement, online deposits (unfortunately, a cash deposit is not supported), and perhaps the most unique feature it has is the Ally Invest.
Ally Bank is like a one-stop-shop for your banking as well as investing needs. Ally Invest is Ally’s online stock broker service. Just like Ally Bank, there’s so much to like about Ally Invest especially its great pricing model.
Another notable feature of Ally Bank that a lot of their customers are really giving praises to the bank’s customer support which is available 24/7 via phone, live chat or email.
By the way, apart from the bank accounts, we mentioned a while ago, Ally Bank also offers a robust range of products such as:
- Auto Loans
- Home Purchase Loans
- Managed Investment Portfolios
- Mortgage Refinance Loans
- Self-Directed Investment Accounts
But for us, the best feature of Ally is that it is free from any charges, and it does not charge foreign transaction fees as well.
Chime Bank offers a variety of key features, which include the following:
SpotMe – This feature allows you to use your debit card in buying stuff without having to worry about overdraft fees. The thing about this feature is that Chime will “spot” you wherever you want to put that little extra cushion to cover the cost of your purchases. To qualify for this feature, you have to receive $500 or more in direct deposits within the last 31 days. Basically, the SpotMe limit starts at $20, and it can go as high as $100 or more. This will be based on your individual account history as well as usage.
Chime Savings Round-Ups – This is how it goes — every time you use your debit card in using something, Chime will automatically round the change up to the nearest $1, and then, it will be deposited to your savings account.
High-Yield Interest Rate of 0.01% – Compared to traditional banks that pays an APY north 1%, Chime Bank only pays a 0.01% APY. If you park your money on your savings account, expect not to earn an annual interest rate. The good thing is, you are given the ability to transfer your Chime savings account to an external account, which allows you to earn 1.15% APY for a balance amounting to $10,000.
Automatic Savings Feature Plus Checkbook – All members of Chime are allowed to have direct deposits places into their checking accounts. From there, customers or users do have the freedom to choose setting up an automatic savings feature, as well as take advantage of the checkbook feature, which allows you to send a paper check for free.
Automatic Deposits and No Foreign Transaction Fees – Chime also offers automatic deposit for your paycheck, which allows you to get your paycheck early. Also, Chime does not charge foreign transaction fees, which makes it a great choice for those who usually travel abroad.
ALLY BANK VS CHIME: FEES AND CHARGES
Both Ally Bank and Chime Bank do not charge any fees like monthly maintenance fees, overdraft fees, and foreign transaction fees, which makes both online banks equal on this part.
So, if you are someone looking for an online bank that is free from fees and charges, you can just opt for any of these two.
However, for Ally Bank, it does have transaction limits for savings accounts, which is limited to 6, after that you will have to pay $10 per exchange.
To add, both banks do not require minimum fees.
ALLY BANK VS CHIME: CUSTOMER SERVICE EXPERIENCE
This Ally Bank vs Chime comparative review will not be complete without us looking into the customer service support of both banks. As a user/customer, customer service support is vital especially since these institutions are online-based.
Having said that, here’s what we found out:
One of the things that make Ally Bank on top of its game – apart from their list of products and other notable features – is the fact that it has excellent customer service support.
Ally Bank has earned second place in the 2019 J.D. Power 2019 Direct Banking Satisfaction Study. According to the said study, they have found that customers of Ally Bank particularly like their Ally account opening experience, the products, as well as the bank’s fee structure.
But apart from all these, the customer applauded the bank’s customer service support. Ally Bank provides phone, email, and live chat support, which is available 24/7. Another unique feature of the bank is that you get to see your estimated wait time before calling, allowing you to decide whether to push through with the call or not.
Meanwhile, if you are using the app or are logged in online, you may also choose to send secure messages and chat about account-specific problems.
Unfortunately, unlike Ally Bank, Chime’s customer service and support staff is lacking, which makes it a big disadvantage given that it is an online banking platform. However, if you are someone who doesn’t mind having or not having customer support, then, this should not be a problem at all.
ALLY BANK VS CHIME: THE PROS AND CONS
To put everything together, here’s our list of pros and cons for both Ally and Chime:
|– Does not charge any fees (e.g. maintenance fee, foreign transaction fees)Does not require account minimums in opening or maintaining an account
– Provides 24/7 customer service through phone, email, or chat
– Offers an interest-paying checking account
– Provides very competitive rates
– Provides an investing platform through Ally InvestProvides an easy-to-use online interface
– Allows e-check deposit – you just have to snap a photo of your check and upload it
|– Does not have a provision for cash deposits
– Does not have a brick-and-mortar location, which means face-to-face contact with a bank officer or teller is not feasible
– Has transaction limits for savings accounts (limited to 6, after which you will have to pay $10 per exchange)
| – Free from fees and charges like monthly fees, overdraft fees, as well as foreign transaction fees
– FDIC-insured, which means your money is safe with them
– Have lots of ATMs — thousands of them that are free for use
– Offers simple direct deposit
|– Does not support cash deposits
– The interest rate is not ideal for savings
– Does not have physical branches — everything is online only
– Customer service is the company’s biggest downfall
As you can see from the above tables, both Ally Bank and Chime Bank have their respective pros and cons, and it’s all up to you to choose which fits your needs and preferences.
FINAL THOUGHTS ON ALLY BANK VS CHIME
Both Ally Bank and Chime Bank offer competitive financial products — depending on the financial situation you are in. But to make things simple, we got to say choose Ally Bank if you want something that has a wide variety of product selections, as well as higher interest rates. Meanwhile, choose Chime Bank if you want mobile banking that comes with money management and savings tools as well.
As we have said earlier, while both Ally and Chime do have their similarities, if you will look closely, they have so many differences as well. At the end of the day, it’s about choosing the platform that you think will work best for you.
So, having said that and having read all the information we provided, have you decided which one is the perfect mobile bank for you yet?