Dollar Savings Direct: 4.00% APY Emigrant Clone
Sometime in the last month or so, (or longer, I have no idea honestly) a new high yield savings bank appeared with little fanfare or press: Dollar Savings Direct. It’s a division of Emigrant Bank, FDIC Certificate #12054, which is the same parent company of Emigrant Direct. On the face of it, it appears there’s little difference besides interest rate and minimums. Dollar Savings Direct has a higher APY at 3.75% but has a minimum balance of $1,000 but no fees (if your balance falls under the minimum, you earn only 1%). If you go to their respective homepages, they’re designed with nearly the same elements (layout is the same except on Dollar Savings you have a picture of Benjamin Franklin versus a patriotic top hat, the buttons are basically the same, color-schemes, etc).
What’s the deal? Well, I called Dollar Savings Direct and chatted with a very nice CSR who explained the whole story. She confirmed that there was no difference other than APY and minimums, that was interesting. She also explained that Dollar Savings Direct was merely Banco Fortuna, Emigrant Bank’s foray into the Spanish-speaking banking market, rebranded in English. I suppose Emigrant’s foray wasn’t as productive as they had hoped. If you visit the Banco Fortuna homepage, it redirects you to Dollar Savings Direct, confirming the CSR’s explanation.
So, from someone who didn’t know about Banco Fortuna (or that it was going away), it appeared as though Emigrant Bank was trying to get more deposits without having to pay their existing Emigrant Direct customers. It now appears that isn’t the case.
The last question I had for the CSR was whether I could transfer between the two accounts and she said no. They were two separate banks, despite having the same FDIC certificate, so to transfer funds you’d need a checking account intermediary.
I don’t see how Emigrant Bank can offer two different rates on essentially the same product for much longer.
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Tags: Dollar Savings Direct, Emigrant Direct, High Yield Savings Accounts
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There are 17 comments, add your thoughts now!
The real question is why they didn’t just have Emigrant buy out the assets of Banco and use the Emigrant brand on it.
As an Emigrant Direct client, I still find it pretty frustrating — regardless of what they say, they are still getting new money without raising the rate for existing clients; regardless of what the actual bank’s name is, its all the same parent company… all seems very silly, and certainly doesn’t help make me feel like a valued customer (which is important when you are no longer a rate-leading bank)
I second Richard’s sentiment.
I’ve already moved most of my money out of Emigrant Direct to Countrywide.
(And after the BoA merger, I’m thinking I need to move it out of there as well…)
It does seem a bit shady, but I’m glad to find out about it.
Thanks!
I wrote an email to EmigrantDirect asking why they had set up Dollar Savings with a higher interest rate for essentially an identical account as EmigrantDirect. The rep wrote back explaining that the difference is that DollarDirect requires a $1000 minimum deposit, and explained how money could be transferred out of my EmigrantDirect to the linked account, then sent back to a newly-opened DollarSavings account. I wrote back that this seemed a counterproductive way to deal with EmigrantDirect depositors. If they want depositors to keep $1000 in an account do it by paying the premium interest rate when you maintain that balance. Don’t make me have to re-do all the automatic deposit and bill-payer arrangements I have already set up! Asked them to pass along the advice to their marketing department.
If you knew that Emigrant Direct’s parent company is BancoPopular (a bank in Puerto Rico, a country which primarily speaks Spanish), (this like pulling teeth from the CSR) you would understand that this new offering is no more exploiting the “Spanish population” than the old one was. Therefore the conclusion to the creation of dollarsavings is truly the fact of attracting new customers without paying loyal customers an additional dime….(not a Spanish thing)
I too emailed them asking why I needed to go through the time and pain of a new account application process when they account I have would otherwise qualify for that rate at the same bank. They answered that it was necessary and that I would have to move money around using an intermediary.
I made it simpler… I just transferred all but a buck to another online savings account I already had that had a slightly better rate than Emigrant anyway. I told them I would do that and I kept my promise. I hope they learned that customers see that as outrageous.
I also called them to ask why the discrepancy… it’s obviously a ploy for new deposits while screwing loyal customers. I wasn’t considering moving my money before, but now I am. Great job, Emigrant!
Shady. I’ve been a customer of EmigrantDirect for years, but this irks me. Throwing up a clone website with a different rate to bypass existing customers, wasting my time by asking me to open a new account…. No thanks.
Wow! I’ve been looking around at other online banks since Emmigrant’s rates have fallen so much in the past 6 months or so. I was initially happy that they were one of the highest when I opened my account 18 months ago. In my searching it seemed a lot of people had problems with other banks, but most had good experiences with Emmigrant. I was going to just stick with Emmigrant and hope the rates go up, but after seeing this I am going to look at moving all my money from Emmigrant to perhaps FNBO. This irks me. Time to do some research on FNBO.
The FED did a rate cut of 0.5% today but did anybody notice Dollar Savings actually increased their advertised rate to 4%. Hope this is all good , I was a bit alarmed to read on this blog that they are owned by Banco Popular when they say that Emigrant was started by Irish Emigrants and all the flag waving on the site. I am happy with the service but just hope there is no funny business and I am trying to get my savings back from the FDIC. The times we are in have left us all a bit scared about stability of the banks.
Emigrant probably needs to raise deposit levels after those like myself emptied our accounts after what they pulled with this different Web site.
They should have done what ING did a couple of years ago… they ran a “winter savings special” or some-such named program where all new deposits during the period got an extra half or full percentage point. Sure people may have moved money back out after the program, but at least existing customers could move new money in and get some benefit.
Emigrant gave the finger to its customers on this one. Fine by me, it was easy enough to move my money to another bank. I was with them for years and was happy, but the customer-hostile move was enough to have me bail. It was much easier to transfer my money out and fire them as one of my banks than it would have been to fill out new applications just to get the rate the same bank is offering… it was just stupid.
Emigrant is NOT affiliated in any way with BancoPopular. Why someone would post such false information is … nuts.
In fact Emigrant is the largets privately owned bank in the country…USA.
If you read the top of the blog it says Banco Fortuna and the link points to Dollar Savings Direct.So what is the relationship to the spanish bank.
EmigrantDirect and BancoFortuna are both divisions of Emigrant Bank in NY. In the summer of this year Emigrant Bank changed the name of BancoFortuna to DollarSavingsDirect and instead of continued focus on spanish speaking people, began offering a higher yielding deposit account catering to persons willing to make a minmium balance initial deposit.
NOTHING at all to do with BancoPopular.
There’s is also another difference between these acounts. Dollar pays interest monthly so if you close the account before interest is posted you loose the interest for that month. With Emigrant you could interest for every day your money is on deposit.
Look, i know it’s a pain if you’re an existing emigrant bankcusstomer to have to close out the account and open a new one at Dollar Savings Direct, but it’s worth it for the 4% interest rate. So i did it. the bank that has my checking account made things really complicated, they just couldn’t figure out how to link, or maybe they didn’t want to. anyway, ever since that was straightened out, i’ve been very happy with my new DSD account and online transfers are seamless, though it’s irritating it takes several days (apparently something common to many online banks) for my deposit to be “useable.”
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