If you are interested in slashing your banking costs and having your bank put some money in your pockets for a change, I think you’ll like reading my PerkStreet review.
BTW, please read through to the end of this post to see how you can get a free copy of my mega best seller ebook “Money Academy For Couples Stop Arguing About Money & Get Your Finances Together in 30 Days”.
Before endorsing (or bashing) any financial product or service, I like to get in there and kick the tires a few times. That’s why I spent a good chunk of time doing my research. And after I did my basic sniffing around, I grilled a Perk Street executive on the phone for more than 75 minutes. Then I called customer service to see if I could trip them up a little. After that I looked under a few rocks to try to uncover a few problems. Here’s what I learned.
What is PerkStreet?
PerkStreet is an FDIC insured bank that offers two products right now; a free checking account and a free debit card. Since they are FDIC insured, each account is insured us to $250,000. They are an online-only bank. The do not have brick and mortar branches. According to PerkStreet’s research, it costs physical banks about $800 per customer/per year to keep their fancy branches open. That’s a lot of cabbage. Guess who ends up footing the bill for those expenses? Bank customers do.
By not having physical branches, it saves PerkStreet a ton of money and they pass those savings on to you. That’s why they can offer excellent service and put money back in your pockets too. In fact, they figure that the average American would save $563 a year by using the PerkStreet’s checking account and debit card compared to any other debit card on the market today. Hefty.
The bank was founded in 2009 and they already have more customers than 50% of all the banks in the United States. That’s impressive if you ask me. PerkStreet estimates that 18% of all bank customers use direct banking (online only) and that number is growing by leaps and bounds every year.
Here’s a brief comparison of PerkStreet versus the competition:
Why might you be interested in opening an account with PerkStreet?
As I hinted above, it costs PerkStreet a tiny fraction of what it costs your typical bank to run. As a result, they operate with almost no fees, free checking accounts (you can open and operate an account with no charges), no minimum balances, a free debit card and a great cash rewards program. I’ll explain all this in just a minute.
What if you want to deposit money into your account?
You have to open an account with a minimum of $25. After that you can send money to Perkstreet f you want to deposit checks into your account. You send your checks to PerkStreet using free postage paid envelopes or you can overnight your deposit for free using a UPS store. Nice.
The exec I spoke with also told me that they are working on mobile applications that will allow you to take a picture of a check and instantly make a deposit. That should be available soon. Far out.
You can also set up automatic transfers into your account from your employer, social security or other banks. No charge. If you have cash, you can go to any Money Gram store and they’ll deposit the cash into your account gratis as well. Money Gram stores can be found in most Wal-Mart’s and many other locations as well.
What if you need cash?
Whenever you need cash you can easily go to any one of their more than 42,000 ATM machines in the STAR system and make a withdrawal. There is no fee whatsoever as long as you use an ATM that is part of the network. They make this pretty easy to do. On their site, they have a button you can select to locate the nearest ATM machine. I checked this out myself and found 4 ATMs within a 3 minute drive of my home. Again, there is no surcharge for this service. Nice.
What about checks?
In terms of writing checks, PerkStreet has you covered as well. They give you your first two books of checks for free. If you run out, you can order more blank checks from PerkStreet for dirt cheap or you can use any vendor you like. And speaking about checks, you can even get overdraft protection on your account if you have the need. Considerate.
What if you want to talk to a human being?
PerkStreet offers 24/7 customer service and all the calls are answered in the United States. That means you won’t have any trouble understanding the nice people on the other end of the phone. In fact, customer service is one thing PerkStreet really prides itself on. I took this for a test ride and called them a few times. They picked up my call within 2 minutes and answered all my questions. I was actually blown away by the professional level of service. What a refreshing change.
Can anyone open an account?
This is actually another plus for PerkStreet. The company doesn’t run a credit check before they agree to open your account. That means if you are trying to rebuild your financial life, PerkStreet is a wonderful partner for you. Even if you’ve experienced credit problems and/or even bankruptcy, these people will do business with you.
Just about the only people Perk Street won’t tango with are those who have run afoul of the Chexsystem program. These are people who have butt heads with banks in the past. So if you have an unresolved issue (like a history of bouncing checks or other problems) you won’t find a welcome mat at Perk Street. But other than that, Perk Street is a good financial partner to consider. Again, this is true even if you struggle with credit card debt.
How does the rewards program work?
This is where the magic happens. They encourage you to use your debit card whenever you can. You will receive 1% cash back on all purchases using the debit card and 2% cash back on purchases from specific major online retailers. (See below for a partial list of vendors.)
The only caveat is that your purchases must be made without using your pin number. In other words, when you present your debit card to the merchant and she asks you “credit or debit” you have to say “credit”.
The reason for this is Perk Street was able to negotiate some sweet deals with MasterCard who processes the transactions this way. Since it’s much cheaper for Perk Street to process transactions through them they pass those benefits on to you.
If a transaction is processed as a debit, they don’t save much money and they can’t pass those savings on to you in the form of cash back. That’s why you have to use your card as a credit card even though it’s a debit card. It’s no big deal because it doesn’t cost you a dime to process the transaction as a credit card (in most cases) but it’s just something you need to keep in mind.
PerkStreet has another cute little deal going. They currently provide 2% cash back on any purchase you make with your PerkStreet debit card as long as another Perk Street debit card is used at the same location within an hour. This is their way of promoting referrals from you. If you and your pals go out and you get them to use their Perk Street debit card when you split the bill, you’ll each get 2% back. Of course there is the added benefit that you won’t have to pick up the whole tab too since your pal is picking up her share of the bill for once. Oh la la.
You can get more points too if that’s your thing. For example, if you keep a $5000 balance in your checking account, you get that 2% cash back for in-store purchases at certain retailers. And every month, PerkStreet asks the users to select favorite retailers. Once everyone votes the “winners” are chosen. Then if you use your debit card at one of those retailers that month, you’ll get 5% cash back. How sweet it is! Here is a table that summarizes the rewards points program:
How do you redeem your cash back rewards points?
You can redeem your points in one of two ways. First, you can get a gift card at select retailers. You just go online and select the denomination and the retailer and PerkStreet will send out your card. It will take about 3 to 5 days for the card to arrive.
If you prefer cash, you can get that money directly deposited into your account. But if you go for cash, the amount will be 9% less than the face value. That’s because PerkStreet buys those gift cards at a discount. If you go for cash, it’s no problem but the bank has no discount to pass on so they have to put a little less into your account. Make sense?
Here’s a list of retailers you can get those gift cards for:
How do you open an account?
You open your account by simply following this link. It will take you about 5 minutes and you’ll be all set. You can see by the screen below that the process is super simple.
PerkStreet is an FDIC insurance bank. That means your account is insured up to $250,000 per account.
In addition, any transactions you make using your debit card are protected. In fact, since the card is actually a MasterCard, you have the same safeguards as a credit card. If there are fraudulent charges on the debit card they will be investigated and reversed. The same goes with vendor disputes. It’s nice to know that PerkStreet has your back.
What are the fees?
Of course nobody works for free and PerkStreet is no different. Of course they make money when they invest the money you deposit in your checking account. This is known as the “spread” and every bank does this. Remember, there is never a maintenance fee for your checking account no matter how much or little you have on deposit. And you’ll never pay a fee to use your debit card either. The do have other costs but they are completely avoidable. In other words, if you don’t want to pay anything, you don’t have to. Here is a summary of those charges:
- Overdraft fee – $32 per item
- Returned item fee – $32 per item
- Inactivity fee – $4.50 (as long as you have SOME activity, any activity, they won’t charge you this)
- Research Fee – $25 per hour, $10 minimum
- Bank or Cashier’s check fee – $8 per check
- Expedited replacement debit card fee – $50 per request
- Stop payment fee -$15 per request
- Incoming wire transfer fee / Credit card funding fee 2.5% of funds loaded if and only if the credit card company charges PerkStreet a fee.
- Deposit item returned fee- $7 per item
- ATM surcharge/Non-network ATM fee -$2.00 per transaction if the ATM is out of the STARsf® system. There are currently
- Foreign Exchange Fee -1% of transaction amount
- Outgoing wire transfer fee – $12 Domestic/$45 International
I like the fact that PerkStreet is very transparent when it comes to fees. They are explained in large blue letters on their website – not hidden away in tiny fonts no human could read. Also, you can Google “PerkStreet Fees” and their fee disclosure (summarized above) is first on the page.
In summary, here’s what I like about PerkStreet
- They don’t rip you off with hidden fees.
- They provide a free checking account with no minimum balances and no maintenance fees.
- You can wire money into your account, set up direct deposit, make online transfers and set up ACH transfers for free.
- You can use any STAR ATM for free and easily find those machines.
- You can download all your transactions from PerkStreet and import the data into QuickBooks or YNAB most other budget tracking software.
- Perkstreet has some great free resources to help savers get their financial house in order through their
- You can speak to a human being fast if you want to. Also, and this could be just me but I consider it a huge benefit that the person speaks English well.
- Free bill pay. This will save you lots of time and I love this feature.
Here’s what I am not crazy about
- I need a bank that will help me with my personal account and my business. Right now, PerkStreet isn’t set up for business accounts. As a result, I could not use this service.
- I don’t like the idea of having to use other companies to deposit cash into my account. Truth be told, I don’t deal with cash a great deal. I don’t see it as a huge problem but it just isn’t something I’m really comfortable with. I like one-stop shopping.
- I personally don’t go nuts for rewards. I could be short-sighted but that’s me. I put a higher premium on convenience and the rewards system seems a little convoluted. I just like things very simple and I like to be able to spend my rewards wherever I like. I appreciate the new policy of putting cash in my account. It’s good that they now allow customers to redeem rewards for credit back to their own account.
- When you call, they don’t tell you to press “0” in order to speak to a human. I wish they put that on the menu. Pet peeve. Sorry. Once I figured this out I got to speak to a human quickly and the people I spoke with were super professional. I just wish that option was made more apparent.
Who PerkStreet is good for
If you shop a lot at the retailers who provide the 2% cash back rewards, this card is a no-brainer. Nobody else is going to reward you so generously. Also, if you don’t have a business and don’t deal with cash a lot, this is a good fit. If you have a very straight-forward banking need yet your current bank is nickel and diming you to death, PerkStreet could be your answer.
Who PerkStreet is no good for
If you deposit cash quite often this would not be my first choice. Also, if you are a business owner and want to use one bank for both personal and business, this wouldn’t work. Finally, if you need a credit card rather than a debit card, this is not a solution for you.
As a parting note, I did some research on “PerkStreet Complaints” and found a few people who complained about extended hold times on their checks when they opened an account. I spoke with PerkStreet about this and found this indeed can be a problem if you have sketchy checks. As it turns out all the banks have scammers who make this complaint and it’s not just PerkStreet. I know that you would never try to pull a fast one. But make sure that if you do business with PerkStreet – or any bank – you ask how long the initial hold is going to be on the checks you deposit.
Have you done business with PerkStreet? What has your experience been so far?
OK – I told you I”d be delighted to send you a free copy of my ebook “Money Academy For Couples” and here’s the deal. If you happen to open an account with Perkstreet leave me a comment and tell me about your experience. I want to hear the good, bad and ugly. You let me know how it goes and I’ll send you the ebook immediately.