U.S. fintech Current introduces high-yield savings where customers earn a 4.00% APY

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As competition among digital banks intensifies, US fintechs Current Introducing a new product designed to make our banking service more attractive. The company announced this morning that it is launching a new high-yield offering called “Interest” that allows any current account holder to earn a 4.00% Annual Percentage Yield (APY) – a rate higher than the national average. 60 times higher, it notes.

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The interest offer will be made available to all current users, including Current’s free basic plan as well as premium users who pay to access advanced features. (The latter group also helps currently being able to promote their APY, in fact, as a premium customer payment Currently $4.99 per month for Extended Service.)

While it is common for Neobanks to offer higher APYs than traditional banks, many banking services require users to jump through hoops to reach higher rates. for example, a finance Offers 1.00% APY in its “Save” product on funds up to $5,000, but to get its higher 3.00% rate, you’ll need to have the auto-savings feature set up. Aspiration and Varo also offer 3.00% APY, but they have their own needs around the cost Balance, Total Direct Deposit, even more.


Current’s new offering, however, pays out-of-funds totals of up to $6,000 annually, the company says. It also notes that there is no minimum balance requirement and no direct deposit or spending requirements. Also, what makes its product different is that all the members will be able to earn interest on their funds on a daily basis. (Typically, banks pay interest monthly.)

But the catch on Current’s product is that a total of $6,000 will have to be spread across its savings pods. So the APY is earned per pod up to $2,000. This makes it a viable option for customers who are just starting to save and who want to organize their money into separate groups, rather than having to park a large balance.

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image credit: Current

Current tells Nerdshala that it’s not offering this high-yield product at a higher rate, which it aims to bring down over time, later.

“We are not taking this as a promotional rate,” explains Josh Stephens, the current VP of Product. “We’re looking at this as something that’s available for all but the foreseeable future … I think, of course, you see the promotional rates from other people, with a lot of bells and whistles attached to it. But it is something that is available to anyone with no minimum balance, no fees,” he says.

The company also sees the rate as a way to better promote its banking service in a crowded scenario. Current, which got its start as a teen banking service, has expanded over the years to offer a more competitive product for adults—including those without children. Like many digital banking services, Current offers fee-free overdrafts, cashback, fee-free ATMs, fast direct deposits, automatic savings, wealth management tools, and more. With the launch of Interest, it is now also responding to customer demands for better savings products.

“Inflation has been rising over the past few months at one of the highest rates in 40 years. [The Consumer Price Index] Growing at the fastest pace since the early 80s,” says Stephens. “And for our members – and for a lot of Americans – it means their money is not going as far as they should. It means they are paying more for the same goods and services. It’s getting harder to keep apart.”

Meanwhile, Current believes that the current options in the market make it difficult for banking customers to grow their money meaningfully.

This change may encourage some banking customers, who have kept their money in savings elsewhere, to switch to the current service instead. Over time, they can upgrade to premium current products and services, making the higher APY worth it from a business standpoint.

Today, Current has over 3 million members, free and paid, with the average age among its member base being 27 years – less than many competitors.

For the long term, the company plans to offer more to these customers to help them grow their money. It plans to enter the crypto space to be last year announced partnership With Acala to create a new category of “Hybrid Finance” that will combine the benefits of traditional banking and decentralized finance. Consumer lending is also on its roadmap.

Current’s new Interest product will start rolling out on iOS and Android from today.

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