May 23, 2003  ·  Lessig

I got a surprising number of replies to my post about online banks. Bank of America has the most loyal customers by far, with 2.5x the number of positive responses over the next highest rank. Second place was tied between USAA and Citibank. Wells Fargo, HSBC, American Express and eTrade also got strong recommendations.

PC Banker got a particularly strong recommendation from someone I know who apparently has a very interesting passion researching such questions. And First Internet Bank of Indiana got a similarly strong set of recommendations.

There were also a surprising number of missives about the value of local credit unions (indeed, adding them together, credit unions were also tied in second place). I am a member of the Stanford Federal Credit Union, but it has discontinued its online access with Quicken.

The most surprising response, however, came from Citibank itself. On the day I posted the question, a very kind manager at Citibank called to tell me he had been reading my webpage (!). Within a day, all problems with my account at Citibank had been corrected, and my account is live. I didn’t quite know how to respond to this, but I count this as extra effort by Citibank, and so I’ll give them a try. More when there’s something useful to report.

Meanwhile, on the power of blogs…

  • Anonymous

    I am posting anonymously (for reasons that will become obvious in a moment). I work for an online bank, which I think offers very nice products and good service. But I do my banking with a competitor. First Internet Bank of Indiana is simply wonderful. They offer a checking account with no fees (if you have a min balance of $500), and they’ll even pay the fees you get charged for using an ATM.

  • Kevin

    And perhaps I can use my Citi Visa, no — Mastercard again:
    Citigroup and Rainforest Action Network call a truce

  • Erik Ostrom

    I thought about recommending B of A because I’m a mostly satisfied customer, but then realized that their online banking deserves little credit for that. I like the features–bill pay, download to Quicken, etc. But, although my primary checking account works fine, I’ve never gotten my secondary account to download successfully.

    And a few months ago they changed the online banking system without advance warning. They reduced (!) the maximum password length, thus invalidating my pre-existing password. And the web site still claimed the old limit, which meant that when I tried to change my password to something else long, I only got mysterious errors.

    When I called them up to ask what the hell was going on, their customer service guy was very patient and helpful. But their web design effort was lacking.

  • David Campbell

    If you are planning to come back to japan anytime soon I would recommend going with Citibank. You can use the Japanese Postal Banking system ATMs and they are everywhere. I live in a small town in Hokkaido and I just go down to the local P.O when I need to deposit or withdraw money.

  • Tom

    I’m suprised that people like Bank of America. Their interest rates are lower than either of my banks (USAA, and a local bank), and the fees are higher. USAA is great. No fees on ATMs, and they pay the fee that the other bank charges. No fee for point of service use either.

  • Marla

    I know B of A has higher fees, but I still like them best. You can’t beat their customer service. I have never felt so personally loved by a bank. I love you too, Bank of America!

  • Tommy

    OK – an issue I know lots about. I have researched this for quite some time and have actually used most of the features that follow for about four or five years now.
    It is my opinion that the best bank/checkwriting/accounting system to use (until the advent of their recent “upgrade”) was (and their personal version run a close second. A variety of things make Paytrust and APfactory special.
    1) After you sign up with them you don’t even have to open the envelopes that your bills come in. You don’t have to write checks anymore or lick stamps. You never have to even SEE your bills again. They all go to a central location where they are scanned and posted to your secure website. You can create automatic rules for payment of the more mundane bills, i.e. always pay the mortgage payment to XYZ Bank, or you can even get more creative i.e. always pay the water bill unless its over $75. (If its that much I want to see the bill because it might mean I have a leak somewhere.) At the end of the year you can order a CD Rom with copies of all of the bills and all of the checks for one year. Cost $29.99 (and by the way its perfectly legal to throw out your paper records and to keep your tax and other records on CD. Banks have been microfilming their records for years.
    2) You can access your bills and pay them from anywhere in the world. This is a great feature now that I am getting older and want to travel. You can even print them out if you want, but it sort of destroys one of the reasons for using this system – - elimination of paper! You can view 12 to 24 months worth of bills from any of your creditors online! I can’t tell you how nice it is to be able to review the past 8 months utility bills when you have the company representative on the phone, or to be able to verify the date, amount, and check number for any payment made to any vendor at the same time.
    3) I can pay my bills in under 10 minutes and when I am done I can download the file to Quickbooks. Both Paytrust and APfactory both link to Quickbooks. Trust me, in todays world you need Quickbooks. Quickbooks is made by Intuit, the makers of Quicken. Quickbooks allows you to do things with your books and records that make your visits with the bookkeeper and accountant a “once in a while event”, rather than an “everyday thing”. To top it all off, at the end of the year you simply purchase TurboTax (also made by Intuit) and the Quickbooks information imports seamlessly into Turbo Tax. After answering the Turbo Tax quesions for an hour or two you have your completed tax return.
    4) You can link either APfactory or Paytrust to any bank or credit union of your choice. However, Paytrust really shines in this department. Paytrust has a list of several hundred banks. Bank of America, Bank of the West, Wells Fargo, Washington Mutual are a few that I remember as being California banks on their list. If you have an account with one of these banks, they will link to the Paytrust account and actually synchronize Paytrust with your bank – - and then when you download, you are essentially synchorizing the banks version of your account with Quickbooks. They call this feature “Smartbalance” and the result is that it is nearly impossible to ever get out of balance again. I used to have problems when I forgot to write down the ATM withdrawal into the checkbook. That problem wouldn’t exist with Smartbalance. You see, since the bank knows about the ATM withdrawal that I forgot about, the bank will notifies Paytrust the next time that a connection between the two is made. Paytrust then notifies Quickbooks the next time that I download. I have a disclaimer to make about the Smartbalance feature. I have yet to use that feature, since my bank isn’t currently one of the banks on their list.
    The cost for a totally seamless and virutally paperless office that used to generate 4 or 5 bankers boxes of accounting records per year – - – less than $50 a month.

  • Sad about USAA

    I must say, I had USAA on my list of tell everyone how wonderful they are. I am quite disappointed. AFter 15 years of business with USAA, I am leaving and taking my homeowners insurance, life insurance, auto insurance, checking, and two savings account with me.

    They have grown so large and impersonal. They no longer are a company of excellent customer service. They look at everyone as a number and no longer care. The false attitude behind the hellos and thank yous are to cover up their incompetence and lack of care for military and customers who need them in this global world.