Taking competitors head-on and hoping to attract new customers,
In addition, there are no annual fees. While Fidelity doesn’t run automated teller machines, it will refund almost all of the fees people are charged at 1 million ATMs run by a number of leading banks carrying the Visa, Plus or Star logos, including Bank of America, Citizens Bank and TD Banknorth.
“This is a next-generation product, better than traditional checking,” said Sanjiv Mirchandani, president of the growth business group at Fidelity.
Customers can set up cash alerts, telling them when they have a excess money in their checking account, which they can then invest, or when funds are low and they are in danger of bouncing a check.
Checking, investment accounts and online trading are “merging together,” said Laura Bruce, senior reporter at Bankrate.com. “For the consumer, it’s all about where you’re going to get the best deal with the most convenience.”
Bank of America first got the ball rolling in October 2006, when it offering 30 free online equity trades a month to customers with a combined $25,000 in their accounts with the bank. For customers with account balances of $100,000 or more, Bank of America is paying a 4.63% interest rate.
This past April, Charles Schwab offered a checking account paying 4.25%, refunds of ATM fees, no minimum balance, insurance on deposits of up to $100,00 and free online bill paying. ING Direct offers a 4% interest rate, and for customers with a balance of $5,000 or more, E*Trade pays 3.2%.