Discover Bank Review

(Editor Rating)



In this review, we’ll look at the types of accounts Discover Bank offers, including how to open an account and the fees charged by Discover Bank.

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Interest Rates


Ease of Use




  • Multiple CD terms
  • High yield savings account
  • No monthly maintenance fees

Editor's note - You can trust the integrity of our balanced, independent financial advice. We may, however, receive compensation from the issuers of some products mentioned in this article. Opinions are the author's alone, and this content has not been provided by, reviewed, approved or endorsed by any advertiser.

As regular readers of the Dough Roller know, I use the Discover it card for daily purchases. It has no annual fee and you can earn up to 5% cash back. Actually, you can earn up to 20% cash back with some online retailers. What you might not know is that the Discover family of companies include an online FDIC-insured bank. Called simply enough, Discover Bank, it offers some of the highest available interest rates on online savings and money market accounts. If you already carry a Discover credit card, there are some nice features that integrate your card with Discover Bank.

Deal of the Day: Chase is now offering a $200 cash bonus when opening a Total Checking Account. No minimum deposit and all deposits are FDIC insured up to the $250,000 per depositor maximum.

Discover Bank’s Products and Services

Discover Bank offers four account types: a money market account, online savings account, certificates of deposit (CD), and an IRA CD. Each of these account types offers different interest rates and different access to your money.

Money Market Account

Discover Bank’s money market account is similar to an interest-bearing checking account with one exception: customers are limited to 6 pre-authorized withdrawals per statement cycle, including automatic or telephone transfers. Any withdrawals over the permitted 6 per statement cycle incurs NO FEE. Now, you may be asking why Discover Bank imposed this limitation. The short answer is that it is required to under federal law.

I won’t dive into the details, but banking regulations prohibit banks from paying interest on certain transaction accounts. To comply with these laws, money market accounts are limited to six withdrawals per statement cycle. Most banks impose fees to curtail this limit but Discover recently changed their structure to attract more business … thus no fee. In short, all money market accounts have this limitation. In normal economic times, money market accounts typically pay higher interest rates than other demand accounts.

Setting up direct deposit into a money market account at Discover Bank has benefits. Customers can earn interest on their money immediately. And they still have access to the money with a debit card, check, or online transfer. An initial deposit of $2,500 is required to open a Discover Bank money market account. There are no fees associated with this account except for special services (e.g., wiring money, ordering checks).

Online Savings Account

While the Discover Bank online savings account is similar to the money market account, there are some important differences. First, the minimum required opening balance is $0. Second, the interest rate is generally higher. While both of these differences favor the online savings account, there is one important difference that favors the money market account–access to funds.

With the saving account, you withdraw money from your account through an online transfer to your checking account (wherever you bank), wire, or official bank check. You cannot write checks against the account or use a Discover debit card or credit card to gain access to your money. As with a money market account, you are limited to six pre-authorized withdraws each statement cycle, with additional withdrawals cost $15 each. So with the online savings account, you give up some methods to withdraw funds, but you gain a lower initial deposit and higher interest rate.

You can also set up automatic transfers from your existing checking or savings account. This is a useful way to automate your savings, whether to build up an emergency fund or to save for a future purchase.

Resource: 10 Guardrails to Help You Reach Financial Freedom

CDs and IRA CDs

Discover Bank offers both a traditional certificate of deposit and an IRA CD designed specifically for retirement savings. The traditional CD is available with terms from 3 months to 10 years. With very competitive rates, Discover Bank makes it easy to accumulate interest that can be reinvested in the CD or transferred to another account. With the IRA CD, Discover Bank offers both the Roth and traditional IRA CDs. And you can rollover a 401(k) or transfer an IRA to Discover Bank. The interest rates for a given term are the same for both the CD and IRA CD products.

Both the CD and IRA CD offer what Discover Bank calls a “no penalty” feature. If you involuntarily lose your job, you can withdraw your funds penalty-free. There are limitations and restrictions on this feature. For example, it only applies to the 12-month CD or IRA CD. So be sure to review the terms on Discover Bank’s website.

Discover Bank’s Website and Customer Service

When you are dealing with an online bank, the website and customer service are critical. Having used the Discover website for a long time, I know first-hand that it is very easy to navigate. The Discover Bank site, while not as robust as the credit card site, is easy to use and offers a number of nice features.

First, Discover Bank offers 24-hour telephone customer support. Whether you have questions about a new or existing account, you can talk to a Discover Bank representative 24/7. Second, the Discover Bank website offers a number of useful financial calculators, including a savings calculator and a tool to forecast your retirement savings. Finally, Discover Bank offers money management tips and advice.

Related: 8 Strategies for Stressing Less About Retirement

Pros and Cons


  • No monthly maintenance fees
  • High yield savings account
  • Multiple CD terms
  • Easy to use website


  • No bank branches

Comparing Rates

As an online bank, Discover Bank offers very competitive rates. Yet it’s always smart to compare rates. Here’s our rate comparison table that shows competitive rates from several online banks:

Author Bio

Total Articles: 1082
Rob founded the Dough Roller in 2007. A litigation attorney in the securities industry, he lives in Northern Virginia with his wife, their two teenagers, and the family mascot, a shih tzu named Sophie.
Article comments
Garlicbulb says:

Sty away from Ally Bank. Their website doesn’t accurately show transactions and they are really hung up on paperowrk

WF Parham says:

I have banked with Ally Bank for many years. I have never had a problem of any kind. Every transaction has been flawless. I am sorry you had a problem with them several years ago.

John Doe says:

There was some confusion with some transfers between Discover and Chase where I believe I was incorrectly charged fees.

Chase quickly refunded their fee without admitting any fault, making this customer happy with Chase.

Discover didn’t do the same.

john says:

they double “pulled” my initial ECH deposit from my bank and denied responsibility. Seems kinda amateurish. is 1/2 of 1% worth this?
Would not do it again but plan on seeing how it goes at this point.
ING or capital one might be better choices.

scott says:

They did this to me today. I understand why it happened. Their website is not very clear about the initial deposit. When you first open the account you enter the amount you want to deposit, then go through the trial deposits. After they go through you get to fund your account… at which point you added another transfer request and… they double.

Stupid process. I talked to a supervisor about it and said she would bring it to management.

Hopefully I can talk my local bank out of the non sufficient funds fee… Which eats up any interest payments I would have gained from this whole endeavor… 😮

flyercab says:

I opened a Discover Bank savings account several years ago. Ease of use has been a big plus for me. I’ve had reason to call them on several occasions and the customer service results of the situation were always to my liking. I’m sold on it.

Tem Roka says:

I should have seen the warning signs. When I first opened the account in August 2011, Discover tried to pull the initial deposit amount ($9,000) THREE TIMES from my other bank, resulting in multiple overdraft charges of $105. When I asked my bank about this, they told me that I needed to get refunded from Discover and of course Discover told me otherwise. So basically I had to fight with both banks and then eventually closed off my original bank account (since their service was worse than Discover’s). What a mistake.

Things were going well for a while with Discover as I had a regular deposit in place. But after unacceptable delays in money transfers and having to wait almost a week for each transaction to occur, I decided to pull out from Discover and open a HSBC bank account that only takes 3 days per transfer. As I was pulling out all my money, of course Discover did what they do the best-they repeatedly tried to “transfer” money into my other account multiple times, resulting in $35 overdraft fees. When I called Discover to ask how on earth this multiple pull happened, they explained that I logged on and transferred the money multiple times myself (they even got a tech person at Discover to verify this!). This was the most insane excuse I have ever heard. And all of this mysterious ‘transfer’ that I requested all occurred after I emptied out my account. When I asked them “why would I try to make transfers from an empty account?”, they were like, “I can see that this doesn’t make sense and there must have been a mistake”. So I asked for a refund for the $35 fee they charged but they told me that was impossible.

I realized that this is how Discover penalizes people who empty out their accounts–they falsely charge you with fees based on a fake transfer that their system creates. This is the most unbelievable experience I have ever had with a bank. I truly believe that Discover bank is committing a crime through their fraudulent practices.

Janet says:

That’s good to know. I am trying to figure out which bank would suit our needs. Sounds like Discover is one to stay away from .Too bad since I like their card

Jim says:

The ‘card’ and the ‘bank’ were two different entities. The card side works flawlessly, the bank however is another story. It was a small Trust Company now operating under the guise of DISCOVER. In my experience with mistakenly moving two IRA’S, a CD, checking and savings has been atrocious. Error after error after error.
It is simply inexcusable, and in my opinion borders on incompetence. As soon as my mistakes mature, they will be moved elsewhere.
One word, avoid – for now…maybe they will get their act together in time, just not now.

Madison says:

I have several accounts with Discover and have never, ever had a problem. Transfers from my local bank to Discover are quick and easy. Their people are friendly and knowledgeable with 24/7, 365 day service. Great bank, great card!

Andrew Tazz says:

How long have you been with them? How long does it take for your transfer to be available? How are you transferring the money…PayPal, transfer from your local bank?

Michele says:

Don’t open an account here if you are divorced. I called customer service to get some help to close my CD and they asked me “security” questions about people related to my ex-husband that I don’t know. Haven’t had any contact with those people in almost 30 years. They claim they get this information from “public records”. It seems they look at web sites like and and choose random information for security questions. So they get information that may be decades old about people that may not even be related to you, even dead people, and addresses you may or may not have lived at 30 years ago that you might or might not remember. So anyone who gets one of these “public records” reports can get into your account. When I told them that they were asking questions about my ex-husbands little brother that I couldn’t possibly answer, they froze my account.

Patty says:

Never heard of such a thing. Maybe this account was opened by your ex-husband?

Votava says:

I am so tired of discover .is there a way i can withdraw above 10,000 in my money market with my debit card?

Steve says:

I have been a satisfied customer of Discover card for years. I notice that they have a a simple straightforward philosophy to all their products, which makes it very easy if you are customers. For example, if you want to do a 0 percent promo rate balance transfer with them, The 0% rate is for 12 months unlike other banks which give you a month and year and figure out the period, and whether it’s really worth doing the transfer. Same with their 5% bonus cashback categories. You know exactly what the categories are and can plan in advance as oppose to Chase freedom, which makes you wait two or three weeks before the new period is supposed to start.
So when I recently got an offer to open an savings account and transfer a certain amount to get a bonus, I decided to give it a try. To my surprise the bonus posted as soon as the amount transferred hit the new account. Plenty of other banks give bonuses too. However you usually have to have the money in the account for a certain period of time,and then once that certain period has been fulfilled they have another certain period which is as equally long, then the bonus is added to the account. I think more people need to give this bank a try.

Tyrone says:

So far all of my experiences with the online savings transactions, and transfer has ben great. I’ve talk with the customer sevices on several occasions, and this too has been great experiences…

Carl says:

I opened an Online Saving account with Discover several years ago and a Money Market account last year. Every transaction has been flawless. Yes, it takes 3-5 days to transfer money between my local bank and discover but I’ve never had a single issue. I’ve called Customer Service a couple of times with questions and they have always been helpful and quick. Their interest rates are very competitive too. It’s been a 5 star experience!

michael says:

I have a Discover Savings account for almost 2 years, and did not have a problem until now. A few days ago, I suddenly received an email saying my account balance went negative. Fear of being hacked, I checked my account online and found that Discover reversed an ACH deposit of $30K from my local bank that was cleared 1 month ago. I called my local bank, and they told me they did initiate the ACH reversal, and as far as they know, the ACH deposit was completed 1 month ago. I called Discover Bank several times and they could not figure out why there was an ACH reversal. They are still trying to sort it out and said they would try to correct it by next week. Luckily I did not need the money now, or I would be screwed by Discover Bank. Also I found out their ACH transfer takes 4 full business days to post. i.e. They will take the money out from your account on Monday and won’t deposit it to your local bank until Friday, so you lose 5 days of interest, compared to my Captial One 360 account that takes only 1-2 business days.