Better than a toaster? Banks offer cash to get customers

If you live in a major U.S. city, odds are that you can earn some quick cash just for opening a checking account. Not surprisingly, the offers, which run as high as $400, often have strings attached. Still, savvy consumers can find some of the promotions rewarding, so long as they read the fine print.

Those are the findings of Bankrate.com, which on Wednesday released a study of financial institutions and their latest offerings, which ranged from a $10 iTunes gift card at BBVA Compass in Dallas to $400 in three of Citibank's major markets.

For those wondering why banks would be willing to pay cash to acquire new accounts, Claes Bell, a data analyst at Bankrate.com, notes that financial institutions already spend money in the form of mailed marketing materials and on telemarketers. Using greenbacks as an incentive is just an expansion of that, he said, so it's buyer beware: "[Banks] are not making these offers to be nice, they want customers that are going to stick around."

For instance, one promotion from Citibank offers $400 for those who keep a minimum balance of $15,000, not a bad return for someone able to keep that much money in an conventional checking account for 90 days, said Bell, who noted that hurdle would be too high for many Americans.

"This needs to be an account that people can live with. If you can't meet the requirements, you can end up paying a bunch of fees," he added. Those pondering such an incentive should "think of it as an actual bonus, but not the reason I'm getting a checking account."

A search of the 10 largest U.S. markets in late April and early May found 37 of the cash offers, which might differ depending on the size of the new account. The strings attached varied as well, with the most common being a stipulation by 21 of the 37 banks that the consumer had to sign up for direct deposit.

Some required minimum balances ranging from $200 to $5,000, while a few of the accounts mandated a minimum number of debit card transactions, from six to 20, to get the reward. And, consumers typically must have the account for 60 to 90 days to get the payout.

Consumers should be especially wary of minimum balance requirements, as failing to maintain them could result in service fees that quickly eat up the cash incentive, Greg McBride, Bankrate's chief financial analyst noted in the report.

Nearly two-thirds of the accounts had no fee for canceling within the first 12 months. "You're best served by looking for a free checking account," McBride wrote. "Long term, you ultimately want to be in an account that has no monthly service charges and no monthly balance requirements."

The last thing a consumer should do is lock up cash in a checking account that pays no interest just to avoid paying fees, rather than putting it in a high-interest savings account, he added.

Here's a list of what Bankrate found for checking bonuses in major markets:

Apple Bank: $100

• Offer valid in New York. No expiration date given.
• To receive the bonus, you must establish and set up direct deposit of a recurring payment into the new checking account. That direct deposit must be verified within 60 days of opening the account. To qualify for this offer, the recurring payment must be a payroll payment, or a federal or state government benefit or pension benefit.
• Fee if account is closed early: $0.
• Monthly fee: $0; balance required to avoid fee: $0.

BBVA Compass: $100 NBAStore.com Gift Card

• Offer valid in Dallas, Houston. No expiration date given.
• To receive the bonus, open an NBA Checking account and make 3 qualifying bill payments of $50 or more within 90 days of activating bill pay.
• Fee if account is closed early: $25 if account is closed within 180 days of opening.
• Monthly fee: $0; balance required to avoid fee: $0.

BBVA Compass: $15 Amazon Gift Card

• Offer valid in Dallas, Houston. No expiration date given.
• To receive the bonus, open an NBA Checking account and have 2 direct deposits of $300 or more within 90 days of activating the "Direct Deposit Dash" game.
• Fee if account is closed early: $25 if account is closed within 180 days of opening.
• Monthly fee: $0; balance required to avoid fee: $0.

BBVA Compass: $10 iTunes Gift Card

• Offer valid in Dallas, Houston. No expiration date given.
• To receive the bonus, open an NBA Checking account and make 40 qualifying purchases using Visa debit card within 30 days.
• Fee if account is closed early: $25 if account is closed within 180 days of opening.
• Monthly fee: $0; balance required to avoid fee: $0.

BMO Harris: $200

• Offer valid in Chicago. Expires July 31, 2016.
• To receive the bonus, sign up for an account (Everyday, Select or Portfolio) and make a direct deposit of at least $300 within the first 60 days. Bonus is deposited into the checking account approximately 120 days after opening the account.
• Fee if account is closed early: $50 if closed within 90 days.
• Monthly fee: $12/$15/$25; balance required to avoid fee: $1,000/$5,000/$25,000.

Cambridge Savings Bank: $100

• Offer valid in Boston. No expiration date given.
• Promotion targets students and employees at companies that Cambridge Savings Bank does business with. $100 bonus is deposited into account after 30-60 days.
• Fee if account is closed early: $0.
• Monthly fee: $10/$20; balance required to avoid fee: $1,000/$10,000.
• Monthly service fee waived with $2,500/$10,000 combined balances in consumer banking products.

Capital One Bank(360): $200

• Offer valid in New York and Washington, D.C. Expires July 31, 2016.
• Promotion is only available if you receive an email or mail directly to sign up for 360 Checking. Bonus requires 2 direct deposit of $200 or more within 60 days of opening account. $200 bonus is deposited into checking account about 90 days after opening.
• Fee if account is closed early: none.
• Monthly fee: none; balance required to avoid fee: none.

Chase Bank: $150

• Offer valid in Chicago, Dallas (national), Detroit, Houston, Los Angeles, New York and San Francisco. Expires Oct. 15, 2016.
• To receive the bonus, open account, deposit $25 or more at opening and have direct deposit made to the account within 60 days of opening the account. Bonus is deposited into account within 10 business days after completing requirements.
• Fee if account is closed early: none.
• Monthly fee: $12; balance required to avoid fee: $1,500.
• Monthly service fee also waived with monthly direct deposits of $500+ OR keep an average daily balance of $5,000+ in combination of qualified checking and savings balances; additional $100 bonus if a Chase Savings account is opened and linked to the checking account.

Citibank: $400

• Offer valid in New York, San Francisco, Washington, D.C. Expires Aug. 31, 2016.
• To receive the bonus, open a new checking account in either The Citigold Account Package or The Citibank Account Package and deposit $15,000 within 30 days. Bonus is paid after account within 90 days.
• Fee if account is closed early: N/A.
• Monthly fee: $25-$30; balance required to avoid fee: $15,000.

Fifth Third Bank: $200

• Offer valid in Chicago, Detroit. Expires July 23, 2016.
• To receive the bonus, open account, set up direct deposit and make 3 online bill payments using Fifth Third's online bill payment service within 90 days of opening the account. Bonus is deposited into the new account within 6 weeks of completing requirements.
• Fee if account is closed early: none.
• Monthly fee: $11; balance required to avoid fee: $1,500.
• Monthly service reduced to $8 with monthly direct deposit of $500 or more; monthly service fee also waived with combined monthly average balance of $1,500 across your deposit and investment accounts OR if you spend at least $500 per month on a Fifth Third credit card OR any existing Fifth Third personal mortgage, auto loan or line of credit with an outstanding balance.

First Republic Bank: $350

• Offer valid in San Francisco. Offer is a case-by-case basis. Bank wants customer to bring all banking relationships and banker will determine if eligible to get the bonus.
• To receive the bonus, the customer must have direct deposit. Bonus gets direct deposited after 90 days.
• Fee if account is closed early: $0.
• Monthly fee: $25; balance required to avoid fee: $3,500.

First Savings Bank of Hegewisch: Up to $100

• Offer valid in Chicago.
• Customer must open with $300. To keep the bonus, you must continually make 5 transactions using the account each month, or the $50 offer will be taken away. After the first 3 months of opening account you will get the $50 bonus; if you get direct deposit right away, you get another $25 bonus; if you do e-statements after 3 months of activity, you get another $25 bonus. The $250 promo is for customers who get a home equity loan.
• Fee if account is closed early: $35.
• Monthly fee: $0; balance required to avoid fee: $0.

Flagstar Bank: $100

• Offer valid in Detroit; varies by location.
• To receive the bonus, set up recurring direct deposit of $250+. Direct deposit must be from a local company. Bonus is deposited into checking account within 60 days of completing requirements.
• Fee if account is closed early: $100.
• Monthly fee: $0/$10/$25; balance required to avoid fee: $0/$1,000/$5,000.
• Hockeytown Banking products match up with Simply Checking line (Red Wings/Powe Play/Hat Trick).

Liberty Bank for Savings: $100

• Offer valid in Chicago.
• To receive the bonus, you need 2 recurring direct deposits of at least $100 within 60 days of opening and 2 bill payments through Liberty Bank Bill Payment. After direct deposit is set up for 60 days, you get the $50. After you sign up for online banking and have it for 60 days, you get another $50.
• Fee if account is closed early: $50 if closed within 90 days.
• Monthly fee: $0; balance required to avoid fee: $0.
• No checks, only debit card.

M&T Bank: $150

• Offer valid in Philadelphia, Washington, D.C. Expires Sept. 30, 2016.
• Bonus is available on any personal checking account. Requires 1 direct deposit of at least $100 within 90 days of account opening. The $150 bonus is deposited into account within 90 days of qualifying direct deposit.
• Fee if account is closed within 12 months: $50 if account is closed within 180 days of opening.
• Monthly fee: $6.95; balance required to avoid fee only avoided with a transaction such as deposit, withdrawal or debit purchase.

PNC: $50/$200/$300

• Offer valid in Detroit, Philadelphia, Washington, D.C. Expires Aug. 31, 2016.
• Bonuses available are $50/$200/$300. Requires 10 debit card transactions within first 60 days for all levels. Virtual Wallet (Base) must have $500 direct deposit within first 60 days; Virtual Wallet Performance Spend requires $2,000 direct deposit within 60 days; Virtual Wallet Performance Select requires $5,000 direct deposit within 60 days. Bonus deposited into checking account within 60 days of completing requirements.
• Fee if account is closed early: $25 fee if closed within first 6 months.
• Monthly fee: Base: $7; Spend: $15; Select: $25. Fee can be waived with direct deposit: Base: $500; Spend: $2,000; Select: $5,000; balance required to avoid fee: Base: $500; Spend: $2,000; Select: $5,000.

Salem Five: $100 Visa Reward Card

• Offer valid in Boston.
• To receive the bonus, registration is required; 2 direct deposits over $250 each, 6 online bill pays over $25 each or 20 debit transactions over $5 each within 60 days. All gift cards will be mailed within 60 days of successfully meeting one of the criteria listed.
• Fee if account is closed early: $0.
• Monthly fee: $15, can be waived with direct deposit; balance required to avoid fee: $1,500.

Santander Bank: $150

• Offer valid in Boston, Philadelphia. Expires Sept. 30, 2016.
• The bonus is available on Simply Right (fees shown), Basic and Premier Plus Checking accounts. Customer must have direct deposits totaling $500 or more within the first 90 days and keep account open for 90 days. Bonus is deposited into account within 30 days of meeting requirements.
• Fee if account is closed early: $25 if account is closed within 90 days of opening.
• Monthly fee: $10; balance required to avoid fee: Only avoided with a transaction such as deposit, withdrawal or debit purchase.

SunTrust: $200

• Offer valid in Washington, D.C. Expires July 31, 2016.
• To receive the bonus, open Select Checking Account online, deposit at least $100 within 14 days of opening, make $2,000 or more in qualifying direct deposit within the first 60 days. Bonus is deposited into account up to 8 weeks after you make the qualifying direct deposit and the minimum account opening deposit.
• Fee if account is closed early: $25 if account is closed within the first 6 months and if the Checking account is closed by the client or SunTrust within 180 days after opening. SunTrust reserves the right to deduct the reward amount from those accounts at the time of closing.
• Monthly fee: $15. Monthly fee also waived with $2,000 or more in total direct deposits each statement cycle or $10,000 in combined relationship balances (deposits, investments, mortgages and loans); balance required to avoid fee: $2,000.

SunTrust: $100

• Offer valid in Washington, D.C. Expires July 31, 2016.
• To receive the bonus, open Essential Checking account online, deposit at least $100 within 14 days of opening, make $500 or more in qualifying direct deposit within the first 60 days. Bonus is deposited into account up to 8 weeks after you make the qualifying direct deposit and the minimum account opening deposit.
• Fee if account is closed early: $25 if account is closed within the first 6 months and if the checking account is closed by the client or SunTrust within 180 days after opening. SunTrust reserves the right to deduct the reward amount from those accounts at the time of closing.
• Monthly fee: $7. Can be also waived with $500 or more in total direct deposits each statement cycle OR make 10 banking transactions per statement cycle; balance required to avoid fee: $500.

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