April 13th, 2009
MoneyAisle Review
MoneyAisle is a new site which banks compete for your deposits. Banks bid on your deposits in real time, offering you a high yield savings account, or a bank CD. All banks are FDIC insured, so you can be assured that your money is fully guaranteed up to $250,000.
Look and Feel
MoneyAisle has a simple clean look, and gives significant prominence to their press coverage on their homepage. Given most people’s hesitancy to use an online service for their finances, the press coverage helps the consumer trust the legitimacy of the website and services provided. They also have a nice video section where you can learn about the website and watch some news coverage of MoneyAisle.
How does it work?
MoneyAisle is similar to an auction site like eBay, but instead of buyers and sellers, you and banks and users. A user will select a high yield savings account or a bank CD, then specify your deposit amount, state of residence, and then hit “submit”. Up to 90 different banks then bid on that amount, and the highest offer is displayed. You can then choose to sign up and execute the transaction. The great part about this is there is no need to register and you can play around with different options to find the best rate.
I choose a few different variations to see how MoneyAisle performed and expectedly, the higher the deposit amount, the better the rate. Looking for the best high yield savings account, I ran through 3 different deposit amounts $1,000, $5,000, and $25,000.
With a $1,000 deposit, which is the minimum value, I was able to get an APY of 2.3% from Flagstar bank. Increasing my deposit to $5,000 had little effect and resulted in same APY from Flagstar. However with a $25,000 deposit, Williamstown Savings Bank was willing to go higher and offered a 2.50% APY.
As a comparison, I’m currently receiving 1.5% APY from ING, and you can get a First National Bank of Omaha account through Credit Karma for 1.90% APY. These accounts have no minimum deposit, so by locking in your amount, the banks will reward you with higher interest rates. One can expect as more banks sign up, there will be more competition for the deposits over 10,000 and will offer even higher rates.
MoneyAisle also offers bank CD’s, and the process is similar. You select your deposit amount and state, as well as a CD duration length, then up to 95 banks will bid for your money. A very nice feature is the ‘compare similar maturities’ which shows you the changes in APY based on the length of the CD.
Once you decide that you want to open the account, you enter some basic information on MoneyAisle, and the bank will then contact you. Since Money Aisle does not ever touch the money, they pass you on to the bank and you will have to sign up directly with them.
Overall Impressions
MoneyAisle provides a great service that allows consumers to get the best possible deal on their deposit money. There may be other methods that you might be able to get a bit higher interest rate on your CD or savings account, but with over 90 banks represented on the site, its smart comparison shopping and a great place to price out different options if you are looking for a new savings account or a CD. Also it’s nice to know that MoneyAisle doesn’t accept advertising, as that could be a potential conflict of interest if one of their providers attempts to advertise on the site.
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How does MoneyAisle make its money?