Radius Bank Review: Low Monthly Fees, But Watch Out for Overdrafts
Radius Bank is primarily an online bank, which means you won’t find branches or even ATMs on every corner. (Radius does have one brick-and-mortar location – in Boston, Massachusetts. Those of you in Beantown can stop by if you’d like.)
This new model of online-focused banking offers a number of benefits that could outweigh the negatives for many customers. Read on for an honest look at the bank’s checking and savings features for individuals and small businesses, as well as its overall convenience and mobile banking features.
What we like:
- 1% cash back on signature-based purchases
- No maintenance fees or minimum balance
- Get your paycheck two days early
- Nice small business options
- Low deposit requirements and good rates on CDs
- Unlike some online banks, you can deposit cash via the ATM network
What we don’t like:
- High overdraft fees
- High balances required before interest kicks in
Checking
Grade: C+
Radius Bank’s Reward Checking is their most popular personal checking account. The account requires a minimum $100 opening deposit, which is a bit on the high side. However, there are no monthly maintenance fees and no minimum balance requirement after the initial $100 minimum opening deposit.
One of the bank’s biggest selling points is the ability to have your paycheck automatically deposited two days earlier than usual. It requires cooperation from your employer, but it can be a great perk if you can arrange it.
Overdrafts can hit you hard. Radius Bank charges $25 per overdraft, and then if your account remains overdrafted for five days, you’ll accrue a $5-per-day penalty.
You can set up overdraft protection by linking to another account or even a line of credit. You won’t pay any transaction fees for overdraft protection, but you could end up paying interest if you use a line of credit.
Radius Bank Rewards Checking is an interest-bearing account, but only if you have a balance of $2,500 or more. The interest rate is 1%, which is far above the national average of 0.09%.
You can also get 1% cash back on all signature-based transactions. In other words, run your transactions as credit rather than debit, and get the cash back. It’ll add up.
Savings
Grade: B
Radius Bank’s basic savings account is called the High-Yield Savings Account because it boasts a high interest rate. It does require a $100 minimum deposit to get your account started, but it doesn’t carry any maintenance fees or minimum balance requirements after the initial deposit.
The real selling point for this account is its 1.25% interest rate on balances of $2,500 to $24,999 and 1.65% on balances above the $25,000 threshold. The national average is only 0.09% APY.
With the High-Yield Savings Account, you also get a free ATM card, which is definitely different for a savings account. You can also transfer funds for free, both internally and externally, by using online or mobile banking.
Radius Bank offers CDs ranging from three months up to five years. It requires a $1,000 minimum for CDs with terms of less than one year, but only $500 for longer-term CDs. Interest rates range from 0.85% to 2.20%. These numbers are some of the lowest minimum deposits and best interest rates out there.
Small Business Banking
Grade: A-
Radius Bank’s most popular checking account for small businesses is called the Tailored Checking Account. It requires a $100 minimum opening deposit to get started.
The bank boasts you can open an account online in 10 minutes or less. The account’s other perks include:
- No minimum balance requirement after the initial $100 opening deposit
- No ATM fees
- Free bill pay
- 24/7 online and mobile banking options
- Unlimited no-fee transactions (you don’t see that too often)
You can also earn interest on your money if you keep your balance at $5,000 or higher. The 0.75% interest is well above the average.
On the downside, accounts with balances below $5,000 will be charged a $10 monthly maintenance fee.
Radius Bank does not offer small business savings account options, but it does offer money market accounts.
Convenience
Grade: B
As an online-focused bank, you won’t find Radius Bank-specific ATMs. But, since you won’t pay ATM fees with Radius, you can use any ATM you like.
The online banking experience is up there with the best of them. You can not only do your banking, but set up budgeting and use other financial wellness tools. Unlike most online banks, you can use their network of NYCE ATMs to make cash deposits.
Radius Bank also offers a wide range of other services including, but not limited to, mortgages, personal loans, student loans, insurance, credit cards and even escrow services.
Mobile Banking
Grade: B
Customers give the Radius Bank mobile app 4.6 out of 5 in the Google Play Store and 4.5 out of 5 stars in the Apple App Store. That’s about par for the course with what we’ve seen from other banking apps.
The app includes bill pay, money transfers, budgeting tools, and a fee-free ATM locator. You can also set up account alerts and check your credit score for free.
For business customers, there is a separate Radius Business app that has features tailored specifically for customers using business accounts.
Our Bank Review Methodology
The Penny Hoarder’s editorial team considers more than 25 factors in its bank account reviews, including fees, minimum daily balance requirements, APYs, overdraft charges, ATM access, number of physical locations, customer service support access and mobile features.
To determine how we weigh each factor, The Penny Hoarder surveyed 1,500 people to find out what banking features matter most to you.
For example, we give top grades to banks that have low fees because our survey showed that this is the No. 1 thing you look for in a bank. Because more than 70% of you said you visited a physical bank branch last year, we consider the number of brick-and-mortar locations. But more than one-third of you use mobile apps for more than 75% of your banking, so digital features are also considered carefully.
Ratings are assigned on a scale of one (worst) to five (best) stars across the following categories:
- Personal checking accounts
- Personal savings accounts
- Small-business banking
- Convenience
- Mobile banking
Credit card and loan products are not currently considered.
Tyler Omoth is a contributor to The Penny Hoarder.
