Huntington are the latest to come out with an online only, high rate savings account.  This field is no getting flooded.  It will be required as a defensive mechanism by most US Banks.

The strategy here is to siphon money from the customers ‘home bank’ (their term) and get funds transferred to the Huntington high rate savings account.

• High yield savings account rate: 5.30%* APY
• $1,000 minimum opening balance
• No minimum balance fee when your balance is $1,000 or more
• Account availability for approved accounts within one hour (weekdays, 7:00 a.m. to 10:00 p.m. ET and weekends, 7:00 a.m. to 7:00 p.m. ET)
• All accounts will feature:

* Online Banking

* Electronic statements with your Anywhere Savings account

* ATM Card

* Electronic money transfer in to and out of your Huntington accounts

Source: DirectHuntington – Online High Yield Savings Account

The web site is simple, with too much information in the pdf files (see below).  I understand the need to have T&C’s but at least include all the relevant information in the site, in an easy and friendly format.  For example I wanted to read about ATM’s and ARM fees but darned if I could find that.  That’s pretty basic information.

There are innovations, and while I am sure others are probably doing this, they use trial deposits a al Paypal to validate account ownership for bringing money over from your other bank.

What are Trial Deposits?

To move money to your new Huntington account, we will make a secure electronic link to your funding account at your home bank. This link is created through trial deposits. Trial deposits are small amounts of money that we will deposit into your funding account within 1 to 3 business days of receiving your completed application.
Detailed instructions will appear during your application process and in an email message from Huntington.

Relevance to Bankwatch:

I hope these Banks have a plan B for this strategy.  Dragging people online by attraction of a high interest savings account is ok, if its backed up with a plan B.  Judging by the 4 legal agreements in PDF, which vary between 6- 8 pages each, I suspect this strategy has been put together hastily.

My take .. these bankDIRECT offshoots would be the perfect platform to attempt innovative internet initiatives to communicate and share information with these new customers at low risk.  why not include a blog for example, explaining what they are planning.

PS .. I took the time to read the legal documents, and they are either very fuzzy or unclear. – an example in the “ELECTRONIC
BANKING SERVICES AGREEMENT AND DISCLOSURE STATEMENT”.  (my emphasis)

TYPES OF AVAILABLE CARDS
We allow the following cards (and their
related card numbers) to access the services
and perform the transactions covered by this
agreement:
* Huntington Temporary Electronic Banking
Card.
* Huntington Electronic Banking Card.
* Huntington Check Card accepted by VISA
merchants.
When you apply for our electronic banking
service, we will determine which card(s) we
will issue to you in response to your request.