Internet banks will sometimes partner with organizations (affinity groups) to help attract more customers. The banks will offer the organization members better rates or signup bonuses. As in the case with Bank of Internet, the rates offered through the affinity groups can be substantially higher than the standard rates.
Discover Bank never offered substantially higher rates for its affinity groups, but it does offer a signup bonus for at least one affinity group. BJ’s members can earn a sign-up bonus of up to $75 at Discover Bank. This offer has been around for a while. DA member Mike first posted on it last year in the forum. Below are the offer’s details:
- BJ's Reward Members: Receive a $75 BJ's Gift Card
- BJ's Inner Circle Members: Receive a $25 BJ's Gift Card
To qualify for the BJ's gift card offer, current BJ's members must open a Discover Online Savings Account with an initial deposit of at least $1,500, or open a Discover CD or Money Market Account with an initial deposit of at least $2,500. All minimum balances must remain in the account for 90 days after the funding date to receive the gift card.
Here’s some of the important small print:
Offer applies to new funds only. Gift card offer limited to one gift card per BJ’s Membership ID per calendar year. IRA CDs are ineligible for this offer. Gift card will be mailed to account address within 6-8 weeks of meeting all qualifications. Gift card awarded by Discover Bank and reported as interest income on IRS form 1099-INT.
Other Affinity Groups
AAA members used to be able to get an extra 5 basis points on all Discover Bank products. However, this bonus rate now only applies to a few of the CDs. Discover Bank also has agreements with other organizations including American Association of Individual Investors (AAII). AAII members still get a 5bps rate bonus on all products. I have more details about these offers in my last Discover Bank CD review.
How Discover Bank Compares With Other Internet Banks
Discover Bank is the only internet bank that's still offering a 2% APY CD. Unfortunately, this requires a 10-year term. Discover Bank's savings account rates have generally been inline with the other major internet banks. Its current rate of 0.80% is a little higher than Capital One 360's savings account rate (0.75%) and just under Ally Bank’s savings/money market account rate (0.84%). Rates are accurate as of 4/5/2013.
Discover Bank is one of the largest internet banks. It has over $71 billion in assets and over $42 billion in deposits. Its overall health score at EpBooks.us is 5 stars (out of 5) with a Texas ratio of 6.58% (excellent) based on December 2012 data. Please refer to our financial overview of Discover Bank for more details. The bank has been a FDIC member since 1934 (FDIC Certificate # 5649).