Porte Banking Offers Unique High Yield Savings Account

Porte is a brand of the financial technology company (fintech) Populus Financial Group that has partnered with MetaBank to offer unique checking and savings accounts. Like many of the new fintech bank accounts, Porte requires a mobile app to open and manage the account. You must first open the checking account, what it calls a demand deposit account. It’s a free checking account, but it pays no interest. Once you have the checking account opened and once you have a direct deposit, you can apply for the savings account. According to the Porte FAQ:

How do I set up the Savings Account?

Once you receive a qualifying Direct Deposit of $1,000 or more in a month, you become eligible for Porte’s Savings Account. Once eligible, the option to set it up will show up in your Porte app.

For savers, the savings account is the most attractive aspect of Porte. The savings account currently offers 3.00% APY on balances up to $15k. The portion of the balance above $15k earns 0.50% APY. Unlike reward checking accounts, there are no monthly requirements to maintain these rates. Once you qualify for the savings account by making the necessary direct deposit, you no longer have to maintain the direct deposit to continue to earn 3%. Also, there are no debit card usage requirements or other activity requirements.

There are several issues to consider.

First, there’s no guarantee that these rates will last. According to the small print of the Porte savings account page:

The interest rates and APYs of each tier may change. The APYs were accurate as of 1/1/2021.

Second, Porte doesn’t make it easy to transfer your funds into and out of the savings account. According to the small print of the Porte savings account page:

Savings Account funds are withdrawn through the Porte Account (maximum 6 such transfers per calendar month) and transaction fees could reduce the interest earned on the Savings Account.

Once your funds are in the Porte Account, you can’t use the Porte App to initiate an ACH transfer to your external bank account. As is common for many online banks, there’s no information about ACH transfer details at Porte’s website. Also, I wasn’t able to learn about these details by calling Porte. Only existing customers are able to connect with a CSR by phone. However, from reviews in their Apple App store, many customers have complained about the App lacking the capability of initiating ACH transfers. In one reply, the Porte representative wrote:

We've been working on adding the ability to transfer funds from your Porte account to other bank accounts

Even though you may not be able to initiate ACH transfers at Porte, you should be able to initiate transfers using your other banks. That will likely be the best way for savers to move money into and out of their Porte accounts.

Thanks to DA reader ichaelm who posted info on Porte in the DA Forum.

My Take

Like many of the fintech bank accounts, Porte appears to be targeting the millennials with a mobile checking and savings account. Thus, they probably don’t anticipate that a high percentage of their customers will keep large amounts in their savings account with little checking account activity. I have a feeling Porte will lower rates as the percentage of these types of customers increase. Until that happens, the savings account is a good deal. Even the rate for the portion of the balance above $15k is competitive when you consider many of the major online banks have lowered their savings account rates to 0.40%.

Availability

Porte accounts are available nationwide. According to Porte’s FAQs:

Porte accounts are available to anyone over the age of majority who is a U.S. citizen or permanent resident in one of the 50 U.S. states or District of Columbia.

You’ll need to download Porte’s mobile app to apply. It appears that there is no hard credit pull. According to the Mobile Banking section of Porte’s website,”

Apply for an account using the Porte app. No credit check required.

As I mentioned above, their customer service phone support (1-800-267-7080) appears to only handle existing customers. If you’re not a customer and are able to get through to a CSR, please leave a comment.

Bank Overview

Porte is a brand of the financial technology company (fintech) Populus Financial Group. Porte is one of several financial related brands owned by Populus. The fintech has partnered with MetaBank which actually holds the deposits of the Porte accounts. Funds in the Porte accounts are FDIC insured through MetaBank. For purposes of FDIC coverage, the funds in your Porte account will be aggregated with funds at all of your other MetaBank accounts.

As we saw with the problems at Beam Financial, banking with fintechs is not the same as banking directly with a bank. However, the fintech banking model used by Porte, in which the fintech partners with just one bank, is safer than the model that was used by Beam, in which the fintech uses a sweep account that distributes funds across a network of banks. Nevertheless, I believe dealing directly with a bank or credit union (whether it’s a brick-and-mortar bank or online-only bank) is generally safer than dealing indirectly with a bank via a fintech.

MetaBank has an overall health grade of "A+" at DepositAccounts.com, with a Texas Ratio of 4.31% (excellent) based on December 31, 2020 data. In the past year, MetaBank has increased its total non-brokered deposits by $1.24 billion, an excellent annual growth rate of 72.5%.

Meta Financial Group, Inc. is the holding company for MetaBank. In Meta Financial Group’s corporate history, it’s described how and when MetaBank transitioned from a typical community bank into its current state:

In 2004, prepaid industry leader Brad Hanson approached former MetaBank CEO Tyler Haahr with a vision for a new kind of bank. Together, they created the Meta Payment Systems division. In a few short years, we became a top collaborator with market-leading partners and one of the top card issuers in the prepaid industry. We continue to push the forefront of payments as we focus on prepaid cards, credit cards, electronic funds transfer and ATM sponsorship.

In addition to being one of the top prepaid issuers in the nation, MetaBank provides deposit account services for fintech/neobank/challenger banks. In addition to Populus/Porte, MetaBank provides deposit account services to MoneyLion.

How the Porte Savings Account Compares

Porte’s high yield on balances up to $15k is similar to the high yield of many reward checking accounts. Unlike reward checking accounts, there are no monthly requirements to maintain the rate.

There are other fintechs that offer similar accounts and rates. One is T-Mobile Money which offers a checking account that earns 4.00% APY on up to $3k when requirements are met. The portion of the balance above $3k earns 1.00% APY. All balances will also earn 1.00% APY if the requirements are not met.

The Porte Savings Account has similarities to the Superior Money Market at Affinity Plus Federal Credit Union. The Superior Money Market Account currently earns 1.00% APY on balances up to $25k, and 0.15% for the portion above $25k. This requires ongoing direct deposit.

The Porte Savings Account also has similarities to the SmartyPig savings account. SmartyPig started out many years ago as a fintech that partnered with a bank. Now, it’s a product offered by Sallie Mae Bank. The account earns 0.70% APY on balances up to $10k, and 0.45% APY for the portion above $10k. There are no direct deposit requirement at SmartyPig.

The above rates are accurate as of 4/19/2021.

To review the best liquid bank account rates, both nationwide and state specific, please refer to our Savings Account rates table, Money Market Account rates table, Standard Checking Account rates table and Reward Checking Account rates table.