Ally Bank and Bank of America are two of the biggest names in online banking today. Both offer convenient digital services, but they have some key differences that consumers should consider when choosing where to do their banking.
This comprehensive guide will compare the pros and cons of Ally Bank and Bank of America to help you decide which is the better option for your needs.
A Brief Comparison Table
| Feature | Ally Bank | Bank of America |
| Account Interest Rates | Higher interest rates on savings and CDs | Very low interest rates |
| Fees | No monthly maintenance fees | Monthly fees if balance minimums not met |
| Physical Locations | Online only, no branches | Extensive branch network and ATMs |
| Account Options | Streamlined offerings | Very extensive account options |
| Customer Service | Top-rated satisfaction | Mixed reviews |
| Mobile App | Full-featured, easy to use | Robust features |
| Security | Standard protections plus alerts | Standard protections plus extras like credit monitoring |
| Bottom Line | Best for digital users focused on low fees and high interest | Better for those who value in-person banking and investment services |
Overview Of Ally Bank
Ally Bank is an online-only bank that offers checking, savings, money market, and CD accounts. It is a division of Ally Financial, one of the largest financial services companies in the United States.
Some key features of Ally Bank include:
- No monthly maintenance fees or minimum balance requirements for deposit accounts
- Free online banking, bill pay, and mobile app
- Access to over 43,000 fee-free ATMs nationwide
- 24/7 live customer support by phone or online chat
- Competitive interest rates on savings and CDs
- No overdraft fees
Ally appeals to consumers who want a streamlined, digital banking experience without brick-and-mortar branch locations. Its focus is purely on online and mobile services.
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Overview Of Bank Of America
Bank of America is one of the “big four” consumer banks in the U.S. In addition to online and mobile services, it operates over 4,000 retail branches nationwide.
Some key features of Bank of America include:
- Access to over 16,000 ATMs and over 4,700 branch locations
- Ability to bank in person, online, or via mobile app
- Extensive account options including checking, savings, money market, CDs, IRAs, and investments
- Rewards program for credit cards and bank accounts
- Zelle person-to-person payments through online or mobile banking
- International banking services
Bank of America is advantageous for those who want the convenience of mobile/online banking paired with the ability to bank in person when needed. It also offers more extensive investment and lending services than Ally Bank.
Comparing Interest Rates & Fees
One of the biggest differences between Ally Bank and Bank of America is their fee structures and interest rates paid on accounts.
Ally Bank pays significantly higher interest rates on savings products compared to national averages:
- Online Savings Account – 3.00% APY
- No Penalty CD – 3.00% – 3.50% APY
- High Yield Money Market – 0.80% – 0.90% APY
Bank of America pays very low interest rates across accounts:
- Advantage Savings – 0.01% – 0.04% APY
- Money Market Savings – 0.01% – 0.04% APY
- Fixed Rate CD – 0.03% – 0.75% APY
For fees, Ally Bank charges no monthly maintenance fees at all, while Bank of America charges monthly fees on many checking and savings accounts if you don’t meet certain balance minimums or deposit thresholds. This makes Ally Bank the cheaper option for many consumers.
Account Options And Features
Ally Bank offers a streamlined lineup of savings, checking, money market, and CD accounts with no hidden fees. Customers can be confident they won’t get nickel-and-dimed by maintenance fees or overdraft charges. Ally focuses on simplifying digital banking services.
Bank of America provides a huge array of checking, savings, lending, and investment services. But this also means more complex fee schedules that make it harder to avoid monthly fees. Customers need to monitor activity and balances more closely to avoid fees. But Bank of America offers more robust services for those who qualify.
Both banks offer mobile check deposit, bill pay, person-to-person payments, and integration with digital money management tools like Mint.com. Bank of America also allows account aggregation within its own app to manage external accounts.
Also watch this review of Ally Bank!
Accessibility Of Branches And Atms
Ally Bank does not have any physical branches, so all banking is done online, through the mobile app, or over the phone. While you can use any ATM nationwide for free, you cannot make in-person transactions or talk to tellers. This is the main downside of Ally Bank.
In contrast, Bank of America has over 16,000 ATM locations and 4,700+ retail branches in 37 states. Customers who prefer in-person banking or want access to a local branch and ATMs will find Bank of America more convenient. Ally Bank is better suited to digital-first users comfortable without physical locations.
Customer Service Reputation
When it comes to customer satisfaction, Ally Bank consistently earns higher marks than Bank of America in surveys and awards:
- Ally Bank rated #1 online bank for overall customer satisfaction by J.D. Power
- Ranked #1 for customer satisfaction among midsize banks by the American Customer Satisfaction Index
- 4 out of 5 stars average customer rating on CreditDonkey
Meanwhile, Bank of America earns mixed reviews:
- 2 out of 5 stars average customer rating on CreditDonkey
- Middle-of-the-pack rankings for customer satisfaction by J.D. Power
- 940+ complaints with Consumer Financial Protection Bureau, compared to 39 for Ally
Ally Bank’s digital focus gives them an edge in streamlined customer service, while Bank of America’s size can make for a more impersonal experience.
Security Protections
Both Ally Bank and Bank of America provide standard security protections like:
- FDIC insurance up to $250,000 per depositor
- No liability for fraudulent debit card transactions when reported promptly
- Encrypted online and mobile banking connections
- Biometric/two-factor authentication for account logins
Additionally, Ally Bank provides security alarms that notify you of suspicious activity, and a 10-day money back guarantee on new accounts.
Bank of America offers extra services like emergency cash, credit freezes, and complimentary identity theft monitoring.
Both banks have robust cybersecurity and fraud prevention protections due to their size and online focus. Neither stands out as significantly more secure than the other.
Frequently Asked Questions (FAQ)
The main downside of Ally Bank is the lack of physical branch locations. If you prefer in-person banking, need to make cash deposits, or want access to local ATMs, Ally Bank may not meet your needs. Their accounts are 100% digital.
Ally Bank is an excellent option for online banking thanks to zero monthly fees on accounts, free ATM access, and leading interest rates. They consistently earn high marks for customer satisfaction as well. For digital banking users, Ally is a great choice.
Ally Bank beats competitors like Bank of America by offering higher interest rates on savings and no monthly maintenance fees. Their online and mobile banking experience is easy to use with great features. If your banking is mostly or entirely digital, Ally Bank provides a convenient and affordable option.
Ally Bank consistently ranks among the top online banks and mid-size banks for overall customer satisfaction according to J.D. Power and other survey rankings. Among national brick-and-mortar banks, Ally Bank offers better interest rates and lower fees than most.
Also Read: Choose Between USAA And Navy Federal Life Insurance.
Bottom Line
In summary, Ally Bank beats out Bank of America for consumers focused on low fees, high interest rates, and digital-first banking services. With no monthly fees on accounts, higher interest rates across the board, and smoother mobile/online banking, Ally Bank is hard to beat on costs and convenience.
The main drawback is lack of physical branches and geographic availability. So Bank of America is better for those who value brick-and-mortar banking or need specialized financial services that Ally does not offer. But for most digital-savvy customers, Ally Bank delivers a simpler, more affordable option.
Switching to Ally Bank is easy with their online account opening and external bank linking. So if you’re looking for an online bank with great interest rates and low fees, give Ally Bank a try!
