Capital One Bank Review: Online and Traditional Accounts

Capital One is an average choice for brick-and-mortar banking, but the best value at this bank is found in its Capital One 360 online accounts. Capital One's higher interest rates and fewer account fees makes it a strong candidate for your online banking, even compared to competitors who focus exclusively in that area.

Review: Should You Open a Capital One Account?

While Capital One 360 is a good option for people used to managing their money online, those who prioritize in-person banking may be disappointed by the limited availability of Capital One's physical banks and traditional accounts.

Good For...Bad For...
  • Online accounts with some access to branches
  • Brick-and-mortar accounts with low monthly fees
  • Cost-effective overdraft policy for online accounts
  • Fewer branch locations than national banks
  • Below-average rates relative to other online banks
  • No international wire transfers for Capital One 360
map of Capital One branches in the US, by county

If you do have Capital One branches nearby, Capital One's traditional products are clearly stronger options than comparable accounts at larger banks such as Bank of America. For instance, Capital One Essential Savings requires no minimum to open or to earn interest, yet earns at least 0.10% APY —ten times the rate on standard savings accounts at Bank of America, Chase and Wells Fargo. Granted, 0.10% isn't exactly a staggering figure, but those who really want better rates would have more success looking at online options.

Though there are quite a few online banks that beat Capital One's rates, the availability of brick-and-mortar service to supplement your online access may tip the scales for a lot of people. The bank's rates don't fall terribly far behind, either: Capital One 360 Savings, the bank's online savings product, yields 0.75% on all balances. When paired with Capital One 360 Checking, which earns 0.20% APY on its own, the bank's online savings option becomes a more comprehensive bank package with respectable yields.

Finally, Capital One 360's overdraft protection policy is much more consumer-friendly than the typical bank. Customers can opt into free transfers from an overdraft line of credit, which charges interest on the amount you overdraw. The current rate of 11.50% APR means that every day, you pay about 3 cents for every $100 of negative balance. Compared to the typical up-front charge of $35 at other banks, Capital One's overdraft policy is basically free; however, you won't have the line of credit option with the bank's traditional accounts, like Capital One Essential Checking.

Capital One 360 Review

Although Capital One 360's rates are fairly average among online accounts, people with lower balances will appreciate the fact that most Capital One 360 accounts don't require any minimum amount to open or to qualify for interest.

Account NameAPYMinimum to Earn APY
Capital One 360 Checking0.20%, 0.75% OR 0.90%$0, $50,000 OR $100,000
Capital One 360 MONEY0.25%$0
Capital One 360 Savings0.75%$0
Capital One 360 Money Market0.60% OR 1.00%$0 OR $10,000

None of these accounts charge a monthly fee, making Capital One 360 one of the most cost-efficient banking options available. While most other banks do provide ways to waive or cancel monthly fees by meeting certain balance levels or making enough transactions, customers at Capital One won't have to worry about fulfilling any conditions to keep their accounts free. This also has the benefit of maximizing your interest, since your balance is protected from any recurring deductions from maintenance.

Capital One 360 Checking and the student-oriented Capital One 360 MONEY accounts are supported by a variety of service options not typical of online banks. Even though these are online accounts, account-holders can still visit Capital One branches to make cash deposits and receive a limited amount of in-person service. This choice of brick-and-mortar service is only available to people living in certain areas, but Capital One's partnership with the Allpoint network of 55,000 machines ensures that you'll likely have access to free ATMs wherever you go.

Other Capital One Accounts

For people who prefer having a more concrete, personal experience with their bank, Capital One provides traditional brick-and-mortar accounts slightly better than its larger competitors. For instance, you won't find any Capital One savings accounts with the insignificant 0.01% APY offered at Chase, Bank of America or Wells Fargo.

Account NameKey Stats
Capital One Essential Checking
  • Monthly Fee: $8.95
  • Monthly Fee Waivers: $300 daily minimum OR $250 in direct deposits
  • Minimum to Open: $50
  • Non-Network ATM Fee: $2
Capital One High Yield Checking
  • APY: 0.20%
  • Monthly Fee: $0
  • Minimum to Open: $500
  • Minimum Balance Required: $5,000
Capital One Essential Savings
  • APY: 0.10% OR 0.50%
  • Minimum for APY: $0 OR $10,000
  • Monthly Fee: $0
  • Minimum to Open: $5

The Capital One Essential Checking Account is a fairly cost-effective banking choice, although its fees make it slightly less affordable than the Capital One 360 online accounts. The $8.95 fee is lower than the same fee at most other nationally available banks, and also requires far less to waive altogether. This is especially useful if you tend to maintain a lower balance: while a bank such as Wells Fargo might require you to keep as much as $1,500 in your checking account to skip the monthly fee, Capital One Essential Checking requires just $300.

By contrast, the main advantage of the Capital One Essential Savings Account is that it charges no monthly fee, which means you can grow your interest worry-free. Its 0.10% APY is ten times the rate for standard savings accounts at bigger banks, and can reach up to 0.50% APY for accounts that hold at least $10,000 in deposits. Other than an online savings account, this is one of the best rates for a no-fee account you'll find at a bank. Currently, Capital One Essential Savings also comes with a promotional rate of 1.10% APY in the first 6 months for new accounts.

Capital One for Small Business Banking

Capital One also offers online and traditional checking accounts designed to help small businesses. You'll have access to several different account options depending on whether or not your business operates within the bank's service areas, as shown on the map above.

Spark Business Checking Accounts

Account NameKey Stats
Capital One Spark Business Checking
  • Availability: branch locations only
  • Monthly Fee: $0
  • Minimum to Open: $0
  • Free Transaction Limit: unlimited
Capital One Spark Business Basic Checking
  • Availability: online/nationwide
  • Monthly Fee: $15
  • Monthly Fee Waiver: Prior 30- or 90-day account balance average of $2,000 OR two or more active business products in Spark Business Credit Card, Small Business Loan or Line of Credit, or Merchant Services account (including Spark Pay)
  • Free Transaction Limit: unlimited
  • Free Cash Deposit Limit: $5,000; fee of $1 for every $1,000 deposited after that
Capital One Spark Business Unlimited Checking
  • Availability: online/nationwide
  • Monthly Fee: $35
  • Monthly Fee Waiver: Prior 30- or 90-day account balance average of $25,000 OR two or more active business products in Spark Business Credit Card, Small Business Loan or Line of Credit, Merchant Services account (including Spark Pay), or Spark ProDeposit
  • Free Transaction Limit: unlimited
  • Free Cash Deposit Limit: unlimited

While all of Capital One's business accounts offer unusually good benefits, it's important to note that the first option, Spark Business Checking, is a brick-and-mortar account that can only be opened at a Capital One branch. Spark Business Basic and Spark Business Unlimited Checking, on the other hand, can be opened online from anywhere in the country. All three business checking accounts avoid the usual per-item fee on account transactions, making them ideal for retail businesses or anyone else who deals with heavy transaction volume.

However, Capital One may be less effective for businesses that deal with large amounts of cash. While the cash deposit limits on Capital One's online accounts are more generous than the restrictions set for business checking at other banks, you'll find it difficult to actually make cash deposits if your business isn't located close to a physical Capital One branch.

Capital One has many other products for small businesses, including credit cards, loans and merchant services. Activating two or more of these will help you avoid the monthly maintenance fees on the Spark Business checking accounts, giving business owners a good incentive to broaden their banking relationship with Capital One. The bank's business savings accounts are highly competitive options, as well: first-time customers earn 1.00% APY for the first 12 months on a Spark Business Savings account and 0.40% APY going forward.

How Does Capital One Compare to Other Banks?

Capital One's products compete against online banks as well as traditional banks, so we've compared the bank to competitors from both areas.

Capital One vs. Ally Bank

As an online bank, Ally beats Capital One 360 at its own game: with an APY of 1.00% and no monthly fee on Ally Online Savings, you'll earn even more interest than you would with a Capital One 360 Savings Account. That said, you can still obtain that 1.00% rate if you put $10,000 in the Capital One 360 Money Market Account. Capital One also comes closer to matching Ally in its checking accounts. If your average checking balance is under $15,000, you'll earn 0.20% APY with Capital One 360 Checking compared to Ally Interest Checking.

Capital One vs. Chase Bank

Chase Bank maintains robust online accessibility through its website and mobile banking app, making it Capital One's closest competitor among the largest banks. However, Chase's underlying accounts and fees don't exactly measure up.

map of Chase branches in the US, by county

With a disappointing 0.01% APY for Chase Savings and the premium interest checking accounts, even Capital One's traditional accounts earn more interest than Chase. Avoiding monthly fees is also harder at Chase, since you need $1,500 to waive fees on Chase Total Checking as opposed to just $300 for Capital One Essential Checking. You should only pick Chase over Capital One if you don't live near any Capital One branches, or if you strongly prefer Chase's excellent credit card rewards program. Banking with Chase makes it much easier to manage any credit card balances you may already have at Chase.

Capital One vs. TD Bank

If you have a choice between TD Bank and Capital One, then you should probably open an account at Capital One for its lower fees and higher interest rates. One important exception is TD Convenience Checking, which has a lower minimum balance requirement than Capital One Essential Checking.

map of TD Bank branches in the US, by county

TD Bank is a highly regional choice for banking, mostly limited to New England states, but its services are also available in some areas where Capital One operates. Although it offers a much larger variety of account types than Capital One, TD's fees stay consistently above the level of costs you'd deal with at Capital One. However, TD Convenience Checking does come free for anyone with a daily minimum of at least $100, making it slightly easier to get free checking at TD than at Capital One, which requires $300 for Capital One Essential Checking.

Capital One vs. Bank of America

When compared to Capital One, Bank of America has many of the same shortcomings as Chase, as it offers slightly higher account fees and much lower interest rates.

map of Bank of America branches in the US, by county

Because account fees and rates at the largest banks tend to mirror one another, you'll find the same $12 monthly fee for standard checking at Bank of America as at Chase, along with the same $1,500 requirement to avoid that fee. Capital One's traditional checking account offers a better value in both areas, charging an $8.95 monthly fee that's waived with just $300 in the bank. Interest rates at Bank of America are similarly weak, hovering between 0.01% and 0.06% APY on balances that earn 0.10% to 1.00% at Capital One.

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