Transportation Alliance Bank (TAB) is one of many banks offering online savings accounts. They were once at the top of the interest rate ladder at 5.25%, but as interest rates have fallen, they have failed to remain competitive and are only offering 3.00% APY on your money. To open an account there is a $25 initial deposit and there’s a $1.00 minimum balance in order to receive the 3.00% APY interest rate. There are no monthly fees.

Transportation Alliance Bank’s premium savings account doesn’t have the best feature set in online banking. You cannot sign up for the account online, and instead have to mail or fax the application in. In addition, you have to fill out another form and mail/fax that in to have your ACH transfers setup. On the ACH form, it states that ACH transfers cannot exceed $1,000. This could be a big problem for any savers with a significant amount of money. There’s an option for Transportation Alliance Bank to use what they call an Express ACH with a higher rate, but according to the application for that Transportation Alliance Bank will do a hard credit pull on your account which will be detrimental to your credit score for the next several months. You can’t even apply for electronic transfers until 90 days after opening the account. There’s a $2.00 fee for outgoing ACH transfers and incoming ACH transfers are free.

Incoming wire transfers are free, but outgoing wire transfers cost $15.00. The interest is compounded on a daily basis and credited monthly. You won’t be able to withdraw money from the account until 10 days after opening the account; subsequent deposits can be withdrawn after three business days.

Some other details from the FAQ and fee schedule about these accounts include: Incoming wire transfers are free. Outgoing wire transfers cost $15. Interest on a Savings Account is compounded daily and credited monthly. Initial deposits that are not guaranteed funds have a 10 business day hold before they can be withdrawn. Most future deposits may be withdrawn after three business days. A paper statement will be issued to customers on a monthly basis.

Transportation Alliance Bank is one of many “virtual” banks which are designed to operate entirely on the bank’s website or by the phone. The bank does have a number of financial service centers that are staffed with support staff and sales associates that market the bank’s products. They have centers in Utah, Kentucky and Georgia. The bank has been a FDIC member since 1998 and it has a total of $466.6 million in assets. Bankrate gave Transportation Alliance Bank a rating of 4 out of 5 stars on their website.

After considering all of the paperwork hassles you have to go through in order to get an account along with its maximum ACH transfer limits, it’s just not worth your time. There are better online savings banks that offer similar rates with much less hassle.

This entry was posted on Wednesday, August 20th, 2008 at 8:47 am and is filed under reviews. You can follow any responses to this entry through the RSS 2.0 feed. You can leave a response, or trackback from your own site.

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