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Mobile Banking

Comenity Direct Review: Best High-Yield Savings And CD Accounts For You

This Comenity Direct review will provide you with all the essential information you need to know about this digital bank. Specifically, it will focus on its product offerings, which include a high-yield savings account and a Certificate of Deposit (CD) account.

Comenity Direct Review: Best High-Yield Savings And CD Accounts For You

There are a lot of factors to consider when looking for a savings account. But, one of the most important things especially if your goal is not just to save but earn from your savings as well, is to find a bank that offers a high annual percentage yield (APY).

For those who are not really familiar with the term high-yield savings account, since we are going to use it a lot in the course of this review, according to CNBC, high-yield savings accounts, unlike a traditional savings account, reward customers with a higher interest rate that allows their money to grow even faster as it sits in the account.

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Technically, the higher the APY on a particular savings account is, the faster the money grows.

Having a high-yield savings account will surely give you better benefits than the conventional ones. After all, who doesn’t like to earn big from their money, right?

Now, there are quite a few banks, particularly online banks that offer high-yield savings accounts out there. And with so many options around, finding the best could be very challenging.

So, to help you a bit with your search for the right online bank that offers a high-yield savings account, today, we are going to particularly talk about one of the many banks that offer such a deal.

In the next few sections, we are going to talk about some very important details on what Comenity Direct is all about, and how competitive its product offerings are. By the way, apart from its high-yield savings account, as mentioned earlier, we are also going to look into how competitive its Certificate of Deposit account is.

For your reference, we are going to specifically tackle the following:

  • What is Comenity Direct?
  • Who is Comenity Direct best for?
  • What are the products offered by Comenity Direct?
  • How to bank with Comenity Direct?
  • Is Comenity Direct safe?
  • What to like about Comenity Direct?
  • What not to like about Comenity Direct?

WHAT IS COMENITY DIRECT?

When choosing a banking institution, whether it’s a traditional or an online bank, it is every customer’s responsibility to ensure that he or she is dealing with the right financial institution.

We always say, though, that when looking for a financial firm to bank with, you have to consider the bank’s credibility, reliability, and trustworthiness. These are important aspects to look into to ensure that your money will not be put to waste. That it is safe and secured.

Now, with that said, here are a few key points that we thought you should know about Comenity Direct —

Comenity Direct is, first of all, a brand of Comenity Capital Bank. It is a digital bank that provides consumers banking products including high-yield savings accounts and certificates of deposit (CDs).

Comenity started in the banking industry in 1986 as a credit card issuer of many retail brands. Fast forward to today, the bank has over 50 million people carry its private label, branded, as well as business credit cards.

Do you want to know more about Comenity Bank? If your answer is a yes, check out the video below by ProudMoney:

However, in the hope to provide more banking opportunities to consumers, the bank launched Comenity Direct in 2018, which, as you know by now, offers online banking services.

Since Comenity Direct is an online banking solutions provider, obviously, it does not have physical branches like what traditional banks have. However, Comenity Direct’s headquarter is based in Springfield, Missouri.

Comenity Direct is a brand of Comenity Capital Bank, a member of the Federal Deposit Insurance Corporation (FDIC), which means all deposits are insured for up to $250,000 per depositor, for every account ownership category should there be a bank failure.

WHO IS COMENITY DIRECT BEST FOR?

Every bank, whether it be traditional or online, catering to a particular group of consumers. There is no such thing as one for all.

True to that, Comenity is also not available for all. It only appeals to a certain group of people particularly those who are looking for very competitive rates on banking products.

Generally, Comenity Direct should be a great choice for those who want to enjoy the convenience that an online bank gives, and not minding not having access to a physical branch or to ATMs.

Additionally, the online bank would appeal to people who do not want to deal with monthly maintenance fees particularly on savings and CD accounts, as well as those who want flexible hours to reach customer service representatives.

WHAT ARE THE PRODUCTS OFFERED BY COMENITY DIRECT?

In the previous sections of this Comenity Direct review, we provided you with key information on what Comenity Direct is all about, as well as who the bank would appeal to the most.

Now, it’s time for the more important part.

One of the most essential things that consumers need to look at when choosing an online bank or even a traditional bank is the products that are being offered. In fact, for most consumers, it’s the very basis of selecting a financial institution to bank with.

Having said that, it’s time to discuss the products that Comenity Direct offers. Although it does offer credit cards, in this Comenity Direct review, we are going to specifically focus on providing you details about its high-yield savings account and certificate of deposit account.

High-Yield Savings Account

Obviously, as the name suggests, Comenity Direct offers a high interest-bearing savings account. It comes with a very competitive annual percentage rate that makes it very appealing to consumers who want to earn bigger on their savings accounts.

Currently, Comenity Direct’s high-yield savings account earns 0.55% APY. The APY changes from time to time, but nonetheless, the rate remains at par with other high-yield savings accounts offered by other online banks.

What’s nice about Comenity Direct is that it constantly monitors the top rates offered by other banks across the banking industry. So, when other high-yield accounts raise their rates, the bank also raises theirs to ensure that their customers always get the best rates available.

To open a Comenity Direct High-Yield Savings account, the bank requires a minimum initial deposit of $100. While it seems a big amount compared to what other online banks require, the good thing is that Comenity Direct does not charge a monthly maintenance fee. Also, account holders get to have up to six free withdrawals per month.

Additionally, high-yield savings account holders are not charged for incoming wire transfers, online statements, as well as Automated Clearing House (ACH).

However, the bank charges for certain activities like a $25 fee per transfer for outgoing wire transfers, a $15 fee per request of paper checks, and a $5 fee per request of paper statement.

Please note that interest on the high-yield savings account is compounded on a day-to-day basis and credited every month.

Certificate of Deposit Account

If you have spare money that you won’t be needing anytime soon or you have a financial goal, opening a Certificate of Deposit is a better route.

By opening a CD account, you get to leave your money for a certain period of time and earn more from it.

Comenity Direct offers five different CD terms with corresponding rates. The CD terms range from one year up to five years.

As a general rule, the longer the term is, the higher the rate will be. As of this writing, the annual percentage yield varies from 0.63% to 0.90%. Similar to the high-yield savings account, interest is compounded daily and credited monthly.

Please note that stated APYs assume that all interest is credited to the CD account. But, customers have the option to have interest paid out on a monthly basis to a verified or Comenity Direct savings account.

Additionally, CD account holders can also auto-renew their CD accounts once it matures or choose to cash out without having to pay any penalty provided it’s done within the 10-day grace period.

Meanwhile, if the account holder decides to withdraw his or her funds before the CD maturity date, an early maturity penalty will be charged.

As for CD terms of up to three years, the penalty would be 180 days of simple interest, while 365 days of simple interest for those with CD terms of four years or more.

Similar to Comenity Direct’s high-yield savings account, ACH transfers, as well as incoming wire transfers are free, too.

By the way, to open a CD account, Comenity Direct requires a minimum deposit of $1,500.

HOW TO BANK WITH COMENITY DIRECT?

Now that you already know what this mobile bank offers, at this point of our Comenity Direct review, we are going to discuss how to actually bank with them.

Since Comenity Direct does not have any physical branches, it made sure to come up with digital access to its product offerings.

Comenity Direct is accessible through a mobile app that is available for both iOS and Android users, as well as through online banking via its website.

Both platforms are accessible 24/7. However, if you need immediate help, Comenity Direct is accessible via chat through a customer service representative. The customer service feature is available Monday–Friday, 7 a.m. to 11 p.m. CT, and Saturday–Sunday (and most holidays), 9 a.m. to 5 p.m. CT.

Meanwhile, to be eligible to open a savings or CD account with Comenity Direct, you must be at least 18 years old and a citizen or a resident alien of the United States.

As with the bank account application process, all you have to do is visit the bank’s website. The whole process is done entirely online. In fact, it only takes a few minutes to open an account.

Similar to other banks, you will be asked to provide personal information such as your name, address, mobile number, and your Social Security number. Additionally, you must ensure to have with you a valid government-issued identification like a passport or driver’s license for identity verification purposes.

Deposits and Withdrawals

Unfortunately, the high-yield savings account, it does not come with ATM access. The only way customers can deposit and withdraw money from the account is by transferring via a linked account.

Fees

If you are looking to avoid bank fees, Comenity Direct is one of the best choices for you. The bank does not charge monthly maintenance fees on both its savings and CD accounts. Consequently, it does not require any minimum balance as well.

Additionally, ACH, as well as incoming wire transfers, are also free of charge.

Meanwhile, there are charges for the corresponding transactions:

  • $25 fee for outgoing wire transfer
  • $15 fee for paper check request
  • $5 for paper statement request

IS COMENITY DIRECT SAFE?

A lot of people are quite hesitant with mobile banking platforms for safety and security reasons. That is why in every review that we make, we always make it a point to look into the safety and security features of the bank.

Comenity Direct, as already mentioned, is an online-only bank, which makes it even more important to look into how safe banking with them is.

Good thing, the safety, and security of all bank account is one of the top concerns of Comenity Direct.

Thus, to ensure that customer data and funds are intact, the bank installed bank-level security features. This ensures that all accounts are safe from fraud and identity theft threats.

Meanwhile, all accounts under Comenity Direct are FDIC-insured through Comenity Capital Bank, a member of the FDIC. All accounts are insured for up to $250,000 per depositor, per account category, in case of a bank failure.

So, is Comenity Direct safe? Definitely.

WHAT TO LIKE ABOUT COMENITY DIRECT?

This Comenity Direct review will not be complete without sharing with you a list of things that we like and not like about this mobile bank.

For this section, though, let us provide you with the things that we like about Comenity Direct first. This includes:

  • Very Competitive Interest Rates – The major come-on of Comenity Direct is definitely its high-yield savings as well as a certificate of deposit accounts. For both accounts, the bank is able to provide customers with the best rates possible. Good thing, they always check other banks’ rates to ensure they’re able to keep up.
  • No Minimum Balance Requirements – Although for savings the initial deposit required is at least $100, while $1,500 for CD accounts, the good thing is, Comenity Direct does not require any balance requirements, which makes it more flexible for customers.
  • No Monthly Maintenance Fees – Another thing that we like about Comenity Direct is that, unlike other mobile banks, it does not charge a monthly maintenance fee.
  • No ACH Transfer Fees – Apart from no monthly fees, Comenity Direct does not charge ACH transfer fees, too.
  • Accessibility – Comenity Direct is available anytime and on all days of the week via the bank’s mobile app and its website. Account-holders can make banking transactions even on weekends and during late nights.
  • FDIC-Insured – Comenity Direct is a brand of Comenity Capital Bank, a member of FDIC. Thus, all deposits are insured for up to $250,000 per depositor, per account category, in case the bank fails.

WHAT NOT TO LIKE ABOUT COMENITY DIRECT?

While there are a lot of things to like about Comenity Direct, it does have its share of downsides as well. Just like the other mobile banking service providers out there, Comenity Direct is not perfect, too, and definitely has a lot of room for improvement in the future.

Some of the things to not like about Comenity Direct are as follows:

  • Limited Product Options – Unlike other mobile banking service providers out there, Comenity Direct does not offer a variety of product options. As of this writing, the online bank only offers high-yield savings and certificate of deposit accounts.
  • No Physical Bank Locations – Comenity Direct is an all-online bank, which means it does not come with any physical branch locations. So, if you want the benefit of having both mobile and traditional bank access, this is not the bank for you.
  • High Minimum Deposit Requirement for Savings and CD Accounts – Compared to other savings and CD accounts, Comenity Direct requires quite a high minimum deposit requirement for both accounts. As mentioned, for savings, the minimum deposit requirement is $100, while $1,500 is required to be able to open a CD account.
  • No ATM Access – Another thing that we wish Comenity Direct would eventually consider is having ATM access. As of now, the mobile bank does not offer ATM access. Accessing cash is only available via online fund transfers.
  • No Cash Deposits or Check Writing – Unfortunately, Comenity Direct does not allow customers to deposit cash or write checks at the moment. We hope, though, that this can be improved in the future to make it more accessible and more convenient for account holders.

FINAL THOUGHTS ON COMENITY DIRECT REVIEW

Comenity Direct is a mobile banking service provider. It was created by Comenity Capital Bank to provide banking services to consumers.

Similar to most online-only banks, it does not have ATM access or access to physical branch locations. However, online fund transfer is feasible, and account holders can access their accounts anytime, anywhere via the website or the mobile app.

While it does have its share of limitations, what’s nice about it is that it offers high-yield savings as well as CD accounts, which makes it ideal for saving money on a long-term basis.

Having said all that, do you think Comenity Direct is the one you are looking for?

With this Comenity Direct review, we hope you are able to see more of the benefits that it offers over its limitations. Hopefully, it is exactly what you are looking for.