First Internet Bank Review - Full Service Online Bank
Do you want the high interest rates paid by online banks, but you’re frustrated by the lack of full-service banking? If so, First Internet Bank may be the dream bank you’ve been looking for. They have just about everything you need and we’ll go over it all in our First Internet Bank review.
It’s truly a one-stop bank, except it’s entirely online.
Headquartered in Fishers, Indiana, First Internet Bank was established in 1999, and now operates in all 50 states. It operates as a full-service bank, though it has zero branch locations. It is a subsidiary of First Internet Bancorp, which is a publicly traded company listed on the NASDAQ (INBK). The company has $3.1 billion in assets as of June 30, 2018.
What distinguishes First Internet Bank from other online banks is that it goes beyond a limited product menu. Where most online banks focus on providing high yield savings products–primarily as a result of the low overhead that comes from operating exclusively online–First Internet Bank provides that as well, but also adds every other banking service you’ll need.
That includes full checking account services, IRAs, HSAs, accounts for minors, education savings accounts, credit cards, vehicle loans, personal loans, student loans, and mortgages. They even provide full-service business banking.
The bank has a rating of A+ (on a scale of A+ to F) from the Better Business Bureau (BBB). The bank has been accredited by BBB since 2013.
First Internet Bank offers a variety of checking, savings, and money market accounts, as well as CDs, paying some of the highest interest rates available. They also offer health savings accounts, IRAs, children’s accounts, and education savings accounts.
Overview details on each account type offered are as follows:
First Internet Bank Online Checking Accounts
First Internet Bank offers two different checking accounts:
Interest Checking. This account pays an Annual Percentage Yield (APY) of 0.70% as of January 2019, when you maintain an average daily balance of $500 or more. The account includes unlimited check writing, and your first order of checks is free. The account comes with free Online and Mobile Banking, including Bill Payment. ATM surcharges are rebated up to $10 per month.
The account does have a $10 monthly maintenance fee, but that is waived with an average daily balance of at least $500. The account requires a minimum of $100 to open, and comes with a Visa Debit card.
Free Checking. There is no monthly maintenance fee, but this account does not pay interest. It requires a minimum of $25 to open, and comes with a Visa Debit card. The account also comes with free Online and Mobile Banking, including Bill Payment. You also get unlimited check writing, and your first order of checks is free.
First Internet Bank Savings Accounts
First Internet Bank offers two different savings accounts:
Regular Savings Account. This is an interest bearing savings account, with an APY of 0.75% as of January 2019. The account requires a minimum initial deposit of $100. The $2 monthly maintenance fee can be avoided with an average daily balance of $1,000. It comes with an ATM card, though since it’s a savings account, you are limited to no more than six withdrawals per monthly statement period.
The bank provides an ATM surcharge rebate of up to $10 per month for use at all out of network ATMs.
Free Savings Account. So named because there is no monthly maintenance fee. But the account does earn interest at a rate of 0.60% APY. The minimum initial deposit is $25, and it also comes with an ATM card. You are limited to no more than six withdrawals per monthly statement period, and there are no ATM surcharge rebates for use of out of network ATMs.
First Internet Bank Money Market Savings Account
This is a high-yield money market savings account, currently paying two interest rate tiers, based on account balance (as of January 2019):
- Daily balance of $250,000 or less, 1.81% APY.
- Daily balance above $250,000, 2.02% APY.
The minimum initial deposit is $100, and there is a monthly maintenance fee of $5 that you can avoid with an average daily balance of at least $4,000.
The account comes with an ATM card, and you are eligible for an ATM surcharge rebate of up to $10 per month for use of non-network ATMs. As is the case with savings accounts, you are also limited to no more than six withdrawals per monthly statement period.
First Internet Bank Certificates of Deposit (CDs)
First Internet Bank CDs range in terms from three months to 60 months. They can be opened with a minimum initial deposit of at least $1,000. Interest APYs as of January 2019, as well as applicable early withdrawal penalties, are as follows:
First Internet Bank Health Savings Accounts (HSAs)
First Internet Bank offers HSA accounts that require no initial deposit, and earn interest at a rate of 0.15% APY (as of January 2019). There is no monthly maintenance fee, and the account comes with a debit card and free online and mobile banking.
The HSA account is an IRS approved program that comes with the following parameters:
First Internet Bank Individual Retirement Accounts (IRAs)
First Internet Bank provides IRA using either the Money Market Savings Account, or any of the CDs it offers, in terms ranging from 12 to 60 months. A minimum opening balance of $1,000 is required.
For 2019, the maximum IRA contribution is $6,000, or $7,000 if you are 50 or older.
First Internet Bank Accounts for Kids
This is referred to as “Tomorrow’s Tycoons”, and it’s designed specifically for account holders under age 18. A minimum of $100 is required to open the account, and there is no limit on the number of deposits you can make. Since it is a savings account, there is a limit of six withdrawals per monthly statement cycle. The account does not come with an ATM card.
But the account is currently paying an APY of 0.75% (as of January 2019), and has no monthly maintenance fee.
The account is automatically converted to a Regular Savings account once the child reaches age 18.
First Internet Bank Coverdell Education Savings Accounts (ESAs)
First Internet Bank offers Coverdell ESAs to help you fund your children’s college educations. You have a choice to invest in either a money market account, or a series of CD’s with terms ranging from 12 to 60 months.
The APY’s on these savings instruments are as follows as of January 2019:
First Internet Bank offers the full range of bank lending products. These include credit cards, personal loans, vehicle loans, student loans, and personal mortgages:
First Internet Bank Credit Cards
First Internet Bank offers a Cashback credit card. It’s a Visa card that work with Apple Pay. Terms of the card are as follows (as of January 2019):
First Internet Bank Personal Loans
First Internet Bank offers personal loans for just about any purpose, from debt consolidation to medical expenses. The loans are unsecured and come with terms of up to 60 months. The interest rate starts at 10.99% APR as of January 2019.
First Internet Bank Vehicle Loans
First Internet Bank Vehicle Loans are available for new and used horse trailers, recreational vehicles, motorcycles, autos, and boats. Rates and terms for each loan type are as follows (as of January 2019):
First Internet Bank Student Loans
First Internet Bank Student Loans are offered through Sallie Mae, as The Smart Option Student Loan. Features and benefits include:
- Multiple in-school repayment options plus a choice of competitive fixed and variable interest rates provides even more flexibility
- No origination fees and no prepayment penalty
- Benefits and an interest rate reduction available
- Rates that reward creditworthy borrowers
- Applying with a creditworthy cosigner may help you qualify
- 100% US-based Student Loan Specialists
First Internet Bank Personal Mortgages
First Internet Bank offers residential mortgages for conventional, FHA and VA loans. They also provide 30-year fixed rate mortgages for all three mortgage types, as well as a 15-year fixed rate for conventional loans. They also provide home equity loans with terms of five, 10, and 15-year fixed rate terms. Prices are competitive, and updated daily.
First Internet Bank provides full service business banking, including the following programs:
First Internet Bank Business Checking
First Internet Bank offers three different business checking accounts. They offer a mix of services, depending upon which account will work best for your business. Some of the services involve include unlimited transactions, remote deposits, online banking, treasury management services, business debit card, an online bill payment.
The three accounts have the following basic parameters:
|Account/Requirement||Minimum Initial Deposit||Monthly Maintenance Fee||Minimum Balance to Avoid Monthly Fee|
|Small Business Checking||$500||$25||$10,000|
|Commercial Premium Checking||$1,000||$15||$25,000|
|Commercial Analysis Checking||$1,000||Earnings credit rates help pay for services use||N/A|
First Internet Bank Business Savings and Money Market
This is the First Internet Bank Regular Savings Account, but it pays much higher interest. As of January 2019, it pays an APY of 1.16% on daily balances up to $250,000, and 1.41% on balances above.
They also offer the Money Market Savings Account, which is identical to the one offered to customers for personal banking.
First Internet Bank Business CDs
Business CDs are identical to the CDs offered for personal banking.
First Internet Bank Business Treasury Management Services and Payments
Business Online Banking includes full banking, funds transfer, disbursement ACH funds, wires, and merchant services. They also offer commercial deposit services, including remote deposit capture, sweep accounts, and zero balance accounts (ZBAs) to consolidate your cash balances between principle and subsidiary accounts.
Other features include:
- Balance and detail report
- Stop payments
- Internal deposit account transfers
- ACH Origination (disbursements and collection)
- Multi-Factor Authentication – the industry’s highest standard for fraud prevention purposes
- Security Key – for extra layer of fraud prevention when processing ACH and Wires
- Quickbooks, Quicken and Comma Separated Value (CSV) file features
First Internet Bank Business Lending
First Internet Bank provides three types of business lending:
- Commercial Lending. Includes working capital lines of credit, acquisition and expansion loans, commercial credit cards, and SBA loans.
- Commercial Real Estate Lending. Customized financing programs for different types of commercial real estate. Includes residential construction and development, office, multi family, retail, and industrial financing.
- Single Tenant Lease Financing Program. Acquisition financing for properties subject to long-term rental lease arrangements with national and regional tenants (typically major retail chains).
Other First Internet Bank Business Services
Some other business services provided by First Internet Bank include:
Dealer Services. Providing funding for horse trailers, stock trailers, motorhomes, travel trailers, fifth wheels, camping trailers, and highway/cruise type motorcycles.
Public finance funding. The Bank works with various governments and nonprofit organizations, including cities, counties, and state governments; hospitals, fire departments, and water and sanitation districts. They offer a variety of product placement bank loans to meet their financing needs.
Specialty financing. Financing for medical practices, including dental, veterinary, and healthcare practices. Financing can be used to buy, start, or sell a practice, or to refinance existing debt.
A First Internet Bank account comes with the following features and benefits:
Bill Pay. Pay anyone or any company anywhere in the U.S. You can use it to set up automatic payments. You can even have your bills come to your bank account for payment.
Mobile Banking. You can download the app for free on iPhone, iPad, Android, and Android tablets. The mobile app has all the functionality of online banking, and also offers text message banking. You can also use mobile banking for remote deposits. Just snap a picture of the check, hit the send button, and you’re all set.
Debit card/ATM card. A Visa Debit card is available with First Internet Online Bank checking accounts. It can be used for purchases anywhere Visa is accepted, as well as for access to ATMs. You have the option to use the card as either a debit or credit card, and it can also be used for Apple Pay.
The Bank also offers ATM-only cards, which cannot be used to make purchases, but will give you access to ATM machines.
First Internet Bank participates in the PLUS ATM network, where you can use either card at over 1.1 million ATMs worldwide, free of charge.
Customer service. Personal Banking customer service is available by phone, Monday through Friday 7:00 AM to 9:00 PM, and Saturdays from 9:00 AM to 3:00 PM–all times Eastern. You can also reach customer service by email from the website.
Account security. First Internet Online Bank is an FDIC member bank. This means your account is protected for up to $250,000 per depositor.
Non-sufficient funds: $30 per occurrence
Overdraft fee: $30 per occurrence
Uncollected fee: $30 per occurrence
Check copies: $5 per copy, but images of checks written within the past 12 months are free through online and mobile banking
Statement copies: $3 per statement, however you can view up to 12 months statements at no cost when they are received electronically
To open an account with First Internet Bank you must first meet the following qualifications:
- Be a legal U.S. resident
- Be at least 18 years old
- Have a Social Security number
- Have a government issued ID (typically a driver’s license or equivalent document)
First, you’ll create a username and password. Then choose what type of account you want to open–checking, savings, money market, certificate of deposit, or other account type.
You can make a deposit into your account through any of the following methods:
- Direct deposit
- Remote deposit from your smartphone
- IScan Deposit – you can scan a check on your home computer, and upload it on Online Banking
- Mail a check
Once you’ve opened your account, you can log in at any time from the First Internet Bank login page.
Question: I get that First Internet Bank offers all banking services. But won’t there be times I may need a bank branch?
A: Banking technology has advanced to the point where physical bank branches are becoming increasingly unnecessary. ATMs are an excellent example of this in everyday life. Even banks with thousands of branches are gradually moving toward online banking. There’s now practically nothing you can do at a bank branch that you can’t do online or from your mobile device.
Question: Can I apply for an account with the bank if I am not a U.S. citizen?
A: First Internet Bank requires only that you are a legal U.S. resident. That means you must have a verifiable U.S. residential address and a U.S. tax identification number or Social Security number.
Question: Does First Internet Bank offer custodial accounts?
A: Yes. You can get a custodial account under either the Uniform Gifts to Minors Act (UGMA) or the Uniform Transfers to Minors Act (UTMA). First Internet Bank even has the Tomorrow’s Tycoons savings account specifically for that purpose.
Question: Can I make deposits into my account from an ATM?
A: Some, but not all, PLUS ATMs do accept deposits. You’ll have to determine which ones in your area will accept them, and use those machines for those times when you want to make an ATM deposit.
Question: Does First Internet Bank offer overdraft protection?
A: Yes. You can add overdraft protection by linking either a savings account or an overdraft line of credit to your checking account.
First Internet Online Bank is one of the most comprehensive online banks available. But if you’re investigating online banks, you owe it to yourself to check out several before making your decision.
We recommend any of the following–all are solid choices:
CIT Bank is similarly aggressive with interest rates. They offer high interest savings and money market accounts, with minimum opening deposits as low as $100. They also have one of the widest varieties of high interest CDs in the industry. For example, their RampUp CD enables you to take advantage of rising interest rates. And their No-Penalty CD has an 11-month term, and allows you to withdraw funds without incurring a prepayment penalty.
Read More: CIT Bank Review
Synchrony Bank offers high-yield savings accounts available with a minimum opening balance of just $50. They also offer a wide variety of high-yield CDs, with terms ranging from 3 to 60 months. However, CDs are a bit steep with the minimum initial investment of $2,000.
Read More: Synchrony Bank Review
FNBO Direct is best known for their high interest savings accounts, that require no minimum balance. However, their CD rates are generally no better than what you can get at a local bank.
This may be the most interesting alternative online bank. Discover offers a checking account, which you can earn up to 1% cash back using the attached debit card. They’re also paying a generous bonus to open a high balance, high interest savings account. Their CD rates are at the high end of the range for both the three- and five-year terms. However, they do require a minimum initial investment of at least $2,500. Of course one of the major advantages with this bank is the tie-in with Discover’s very attractive credit card offers.
Read More: Discover Bank Review
First Internet Bank Pros and Cons
- High interest rates — First Internet Bank offers some of the highest interest rates available on money markets and CDs.
- Little to no fees. — Monthly maintenance fees, where they apply, are easily avoided.
- Full-service online bank — First Internet Bank is a full-service online bank, which is a rarity in the online universe.
- Variety of products to fit your needs — The Bank offers every type of loan you’ll need, including credit cards, vehicle loans, personal loans, student loans, and mortgages.
- Business banking — First Internet Bank provides full business banking services.
- Mobile app — You can scan and upload checks to online banking from your home computer (iScan), as well as make mobile deposits from your smartphone.
- ATM network — Access to more than 1.1 million ATMs worldwide.
- Available everywhere — The bank services customers in all 50 states.
- No physical bank branches — This, of course, is what online banking is all about.
- Interest rates are not the best — Interest rates paid on savings accounts are lower than other online banks.
Based on the combination of services offered, from checking accounts, to high-yield money market account and CDs, IRAs, HSAs, and ESAs, First Internet Bank qualifies as a full service online bank. That’s rare in an industry where most participants focus solely on high-yield savings products, and totally exclude other common banking services.
First Internet Bank also provides the full range of loans the average consumer will need. This includes credit cards, personal loans, student loans, vehicle loans, and even home mortgages.
First Internet Bank can even accommodate business clients. They offer all business banking services, including a high-yield money market account and CDs.
Given the sheer number of banking services offered, First Internet Bank should be near the top of your search for an online bank. The basic advantage is that you can do all your banking with this company. There’ll be no need to maintain a local bank for basic banking services, like checking and loans, while keeping the online bank strictly for high-yield savings products.
If you’d like more information, or if you’d like to open an account with the bank, visit the First Internet Online Bank website.