PerkStreet Financial, the online bank O'Malley is talking about, offers a free checking account and one of the most flexible debit card rewards programs we've seen.
Perk Street's newest reward program offers several levels of rewards based on how much you have in checking and where you are spending you money. Perk Street members with $5,000 or more in checking will now receive a 2% cash back reward on any non-PIN debit card purchase and those with less than $5,000 will continue to receive 1% cash back.
In addition to the standard rewards structure, PerkStreet is now offering 5% cash back on special categories and merchants each month. The current 5% cash back categories for June 23rd through July include:
- Gas: earn cash back on any pay at the pump gas purchase
- Home Improvement: rewards for any purchase at Home Depot, Lowes and Menard's
- Ice cream: Treat yourself at Ben &Jerry's, Dairy Queen, Culver's and Cold Stone Creamery and earn rewards.
The rewards system at PerkStreet is straightforward and allows its customers to switch between the three debit card rewards at any time with a few clicks. You can take a cash back reward starting at $5, or get a free cup of coffee for every $200 spent or free song for each $100 spent. In truth, most consumers probably won't spend the $33,333 required to earn $500 in the debit card rewards that O'Malley mentions, but it is nice to know that there is no rewards cap to max out.
PerkStreet claims to have one the largest no-fee ATM networks in the nation, close to 40,000, inside stores such as CVS, Walgreens and Circle K. Because PerkStreet's ATMs are located in stores, and not at branches, you can't make a deposit at one of these locations. To make a deposit to PerkStreet you can mail a check in a pre-paid envelope, take it to a Mailboxes Etc. or UPS location where it will be sent overnight for free. Hopefully, PerkStreet will offer the option to scan your check or make a deposit with an iPhone, as does USAA.
Like its brick and mortar competitors, PerkStreet is FDIC insured up to $250,000 and offers phone support if you have a problem. The bank keeps costs low by providing customer service through call centers rather than branches. Its call centers in Delaware and Wisconsin claim answer times of close to 30 seconds.
O'Malley says the low overhead that comes from not operating branches is the reason PerkStreet doesn't need to charge for membership to its debit card reward program. While debit card rewards programs are growing in popularity and offering better perks, many are only doing so with an annual fee.
While there is no ATM fee at many locations and no annual fee, there are some fees at PerkStreet including a $4.50 inactivity fee if you don't use the account in some manner once a month, and optional $25 overdraft protection fee. Customers can opt out of the overdraft protection program -- under which the back can decide, at its own discretion, to pay checks even if the customers has insufficient funds in their account. More remarkably, the bank does not charge insufficient funds fees.
"We look and feel more like a community bank, albeit for the Internet community." is how O'Malley describes the culture of PerkStreet. Given its emphasis on customer service, encouraging smart decisions and rewards, I am inclined to agree that PerkStreet looks and feels like a community bank. I look for good things to come from this community bank for the Internet model and hope to see more from PerkStreet and other similar banks in the near future.