Capital One review: High APYS, no fees, great mobile banking

An online-first bank with some of the best APYs and a great mobile experience

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Derek Silva

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Derek Silva

Derek Silva

Personal Finance Expert

Derek is a personal finance editor at Policygenius in New York City, and an expert in taxes. He has been writing about estate planning, investing, and other personal finance topics since 2017. He especially loves using data to tell a story. His work has been covered by Yahoo Finance, MSN, Business Insider, and CNBC.

Published October 26, 2021|5 min read

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5.0 / 5

Capital One offers online banking services nationwide with a full suite of financial offerings. It’s online savings account offers an APY of 0.40%, which is well above the national average of 0.06%. It also offers a checking account that earns interest, accounts tailored to children, and certificates of deposit (CDs). If you need a credit card that gives cash back or travel rewards, Capital One has multiple to choose from. In fact, Capital One is the third-largest U.S. card company according to Reuters. [1]

Capital One

OVERALL

Out of 5. See our Methodology section at the bottom of the page.

5.0

THE GOOD

    0.40% APY savings account

    70,000+ fee-free ATMs nationwide

    Top-rated mobile app and customer satisfaction

    Over a dozen credit card options

THE BAD

    Branch locations in only a handful of cities and states

    No money market or investment accounts

THE BOTTOM LINE

Capital One is among the highest-ranking banks we’ve looked at, scoring a perfect 5 out of 5. Whether you’re looking for a high interest rate, fee-free banking, great mobile banking, a new credit card, or all of the above, Capital One could be the right choice for you.

Savings APY

See our Methodology section at the bottom of the page for more details.

10.0

Offerings

See our Methodology section at the bottom of the page for more details.

10.0

Mobile App

See our Methodology section at the bottom of the page for more details.

10.0

Fees

See our Methodology section at the bottom of the page for more details.

10.0

Support

See our Methodology section at the bottom of the page for more details.

10.0

The good

High interest rates

Capital One offers an APY of 0.40% for it’s savings account, which is more than 6x higher than the national average of 0.06%, according to the Federal Deposit Insurance Corporation (FDIC). [2] Even its main checking account earns more than the national average with an APY of 0.10%.

Fee-free banking

Unlike many other national banks, Capital One has basically no fees. If you want to open an account, there is no minimum to open, no minimum balance you need to maintain, and no monthly fee. There’s no card replacement fee and if you want to use an ATM, Capital One has more than 70,000 fee-free ATMs nationwide.

If you want to avoid overdraft fees, there are a few options. You can choose for Capital One to simply deny all transactions that would result in an overdraft, you can opt to automatically pull any overdrafted amount from your savings account, or you can choose neither and Capital One will always give you a 24-hour grace period to cover any overdraft you make.

A wide range of banking options

Capital One offers multiple savings and checking accounts, including accounts tailored to children and teens. CD accounts are available for multiple term lengths. If you want a credit card, Capital One has nearly a dozen flagship cards, with additional options for students, people with lower credit scores, and businesses. Capital One doesn’t have a full range of loan products, but it does offer auto loans and refinancing.

Capital One in the news

  • In September 2021, Capital One announced it would test a buy-now pay-later (BNPL) service sometime in 2021. The bank had previously banned use of its credit cards for BNPL services, describing the resulting point-of-sale loans as risky.

  • In August 2021, Capital One gave $50,000-worth of business grants to three Black women as part of the Black Girl Magic Digital Summit, an event to help Black women open and run their own new businesses.

The bad 

Limited branch locations

Capital One is primarily an online bank and most people don’t live near a physical branch. Luckily, Capital One offers a great online banking experience, a top-rated mobile app, and a lot of ATMs. If you live in certain states, brick-and-mortar bank locations are available. Residents of New York, New Jersey, Texas, Louisiana, Virginia, and Washington, D.C. may have a nearby branch.

Not a full suite of options

The banking options that Capital One does offer are great, but you will need to go elsewhere for certain services. For example, there are no investing accounts or money market accounts (though the savings account rates are higher than the money market rates at most banks). The only loan products offered by Capital One are auto loans.

Reputation

Capital One customers generally give the bank some of the highest satisfaction scores among national banks, according to J.D. Power. [3] In 2021, Capital One ranked fifth in overall customer satisfaction. It also scored the third highest in mobile app satisfaction and sixth in online banking satisfaction. [4]

For those concerned with the bank’s social activity, Capital One has stated its dedication to mitigating climate change. In 2017, it bought 100% of its electricity from renewable sources. In 2018, it installed its first on-site solar project and it became a member of RE100, a global initiative where companies commit to 100% renewable electricity. Looking at broader social initiatives, in 2020, the bank pledged $10 million to organizations that were advancing the cause of social justice for Black communities. [5] The bank awarded $3 million in grants to eight nonprofit organizations that were affected by the coronavirus pandemic. [6]

Capital One doesn’t have a perfect reputation, though. In 2019, Capital One was hacked and suffered a data breach that affected 100 million people in the U.S. Most of the information stolen by the hacker was from credit card applications filed between 2005 and early 2019. According to Capital One, the hacker stole 140,000 Social Security numbers, 80,000 linked bank account numbers, and other information about card holders such as credit scores, credit limits, and contact information. [7] Capital One said it directly notified all individuals whose SSNs and bank account information were accessed. It also offered free credit monitoring and identity protection to everyone affected. [8]

Previously, Capital One was fined $100 million after the Office of the Comptroller of the Currency (OCC) — a bureau within the U.S. Treasury — found that the bank had failed to fully comply with a 2015 order to improve its anti-money laundering policies. [9]

The Consumer Financial Protection Bureau (CFPB) also took action against Capital One in 2012, requiring the bank to refund $140 million to two million customers and to pay an additional $25 million penalty. The action came after a CFPB examination identified that Capital One’s vendors had used deceptive marketing tactics to mislead or pressure credit card customers into paying for “add-on products” such as credit monitoring when activated their cards. [10]

Methodology

To compare Capital One with other options and determine the best banks and credit unions of 2021, we collected quantitative data on more than 50 major U.S. financial institutions. Specifically, we looked at savings account APYs, product offerings, fees, mobile app satisfaction, and customer support. We rated each aspect on a scale from 1 to 5, then averaged the five scores into a single rating. Here’s a detailed breakdown of each scoring matrix.

Savings account APY

We rated the highest APY that each bank or credit union offers on a savings account (excluding accounts or rates with a minimum balance requirement greater than $1,000).

Rating

Best Savings APY

1

Less than 0.1%

2

0.10%-0.19%

3

0.20%-0.29%

4

0.30%-0.39%

5

0.40%+

Offerings

We counted how many product lines each institution offers, since many people enjoy the convenience of keeping multiple accounts at the same bank. We included deposit accounts (checking, savings, money market, certificates of deposit), credit cards, loans (personal, student, auto, home equity), mortgages and mortgage refinancing, retirement accounts, and investment accounts as distinct qualifying offerings.

Rating

Offerings

1

1 offering

2

2 offerings

3

3 offerings

4

4 offerings

5

5+ offerings

Mobile app satisfaction

Since mobile apps are increasingly becoming the primary way people manage their bank accounts, we consulted the J.D. Power 2021 U.S. Banking Mobile App Satisfaction Study. For any banks or credit unions that weren’t included in the study, we used mobile app customer ratings from the Google Play store.

Rating

J.D. Power Score

App Store Score

1

Less than 840

Less than 3.0

2

840-849

3.0-3.4

3

850-859

3.5-3.9

4

860-869

4.0-4.4

5

870+

4.5+

Fees

We consulted every bank’s fee schedule and terms and conditions to search for any of the following: monthly maintenance fee, overdraft fee, insufficient funds fee, debit card replacement fee, account closure fee, and stop payment order fee.

Rating

Qualifying Fees

1

4+ fees

2

3 fees

3

2 fees

4

1 fee

5

0 fees

Customer support

Since different people prefer different support options at different times, we counted how many customer support channels each bank offers, including telephone, email, online chat, mobile app, online forums, online learning center, and physical branches.

Rating

Support Channels

1

1 option

2

2 options

3

3 options

4

4 options

5

5+ options