Newtek Bank review 2024: Competitive rates and low fees, yet falls short on full-service banking

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Newtek Bank was founded in 1963 and focused on providing financial services to businesses. In recent years, it has expanded its offerings to include personal banking products, including high-yield savings accounts and certificates of deposit (CDs). The bank operates primarily online and has only one physical location.

Newtek Bank can be a good choice if you're looking for an online bank to park your savings and earn a high interest rate. 

Newtek Bank accounts 

Newtek Bank offers two types of accounts for personal banking: high-yield savings and CDs. 

Personal High Yield Savings 

Newtek Bank’s high-yield savings account offers a competitive 5.25% APY with no minimum balance requirements and no monthly maintenance fees. 

This account offers one of the highest APYs in the nation, making it one of the best high-yield savings accounts. You don't have to jump through hoops to obtain this rate — all balances will earn 5.25%. 

To access your funds in a Newtek Bank savings account, you can:

1. Initiate an online transfer to a linked external account (typically takes 3 business days)
2. Request a wire transfer (outgoing domestic wire fee: $100)
3. Contact customer service to request a cashier's check or money order

CDs

Newtek Bank provides a range of CD options, including fixed-rate and variable-rate CDs. All CDs have a $2,500 minimum initial deposit, which can be quite steep compared to other banks.

Fixed-rate CD terms range from 6 to 60 months, with rates up to 5.05% APY. NewTek also offers a variable-rate 24-month CD that offers 5.60% — one of the highest 2-year CD rates on the market.

Here’s a breakdown of NewTek’s CD rates: 

All of NewTek’s CD’s charge early withdrawal penalties, though the amount ranges based on the CD’s term:

• For CDs with terms under 12 months: 90 days' worth of simple interest on the amount withdrawn
• For CDs with terms over 12 months: 180 days' worth of simple interest on the amount withdrawn

For the 24-month variable-rate CD, the early withdrawal penalty is 1% of the principal balance, along with any uncredited interest, at the time of withdrawal.

Other Newtek Bank products and services 

In addition to its personal high-yield savings account and CD offerings, Newtek Bank offers a few business banking offerings, including a business checking account, a business money market account, and business CDs. 

As part of Newtek One, Newtek Bank business customers can also access additional offerings like Newtek Advantage, a digital tool that helps businesses gain a more comprehensive overview of their finances. 

Newtek Bank fees 

Newtek Bank prides itself on its minimal fee structure:

• No monthly maintenance fees for savings accounts or CDs
• No account opening fees
• No fees for incoming wire transfers
• Outgoing domestic wire fee: $100
• Non-sufficient funds (NSF) fee: $30
• Stop payment fee: $20
• Dormant account fee: $10 per month (after 12 months of inactivity)

Newtek Bank banking experience 

Newtek Bank offers a more robust banking experience for businesses, but its offerings for personal accounts are more limited.

Online and mobile banking platform 

Newtek is a digital bank, so you can quickly sign up for an account online—in as fast as two minutes, according to Newtek—and manage your account on the web or through its mobile app.

Mobile app features

• Check account balances and transaction history
• Transfer funds between Newtek Bank accounts
• Initiate external transfers to linked accounts
• Deposit checks remotely using mobile check deposit
• Contact customer support through voice or text chat

User ratings:

• iOS: 4.6 out of 5 stars (based on 250 ratings)
• Android: 4.4 out of 5 stars (based on 60 ratings)

Common user complaints:

• Slow external transfer processing times 
• Occasional app glitches or login issues
• Limited mobile app functionality compared to some competitors

Online banking features

• View account balances, transaction history, and statements
• Set up and manage account alerts
• Initiate transfers between Newtek Bank accounts and external linked accounts
• Open new accounts or renew CDs
• Contact customer support through video chat

User reviews:

• Generally positive feedback on ease of use and reliability
• Some complaints about the dated interface and limited customization options

Customer service

Newtek Bank offers multiple channels for customer support:

• Phone support: Call 855-763-9835 24/7 for assistance
• Email support: Send a message to [email protected] 
• Online chat: Available through the online banking platform, Monday-Friday, 9:00 a.m. to 5:00 p.m. ET
• Text chat: Start a conversation through the mobile app, 24/7

Typical response times:

• Phone support: Wait times vary but are generally longer during peak hours (weekdays, 10:00 a.m. to 3:00 p.m. ET)
• Email support: Expect a response within 1-2 business days
• Video, voice, and text chat: Usually connected with a representative within a few minutes during operating hours

Account security 

Newtek Bank offers relatively standard security features but covers the important basics. It’s a member of FDIC, which provides insurance for up to $250,000 per depositor per account ownership category. Newtek Bank also offers two-factor authentication and encryption for enhanced information security. 

How Newtek Bank stacks up 

While Newtek Bank offers competitive rates, especially on savings accounts and short-term CDs, it lacks the full range of products and services some competitors offer. Ally Bank, for example, provides checking accounts and a more extensive ATM network. 

How we rated this bank

Every bank review we publish has undergone a rigorous editorial process to ensure accuracy and objectivity. Learn more about our methodology here. 

Here are some of the factors that influenced this bank’s overall score:

The bottom line

Newtek Bank's strengths lie in its high interest rates and low fee structure. It offers some of the most competitive rates in the market for both savings accounts and CDs, with minimal fees.

However, the bank falls short in several areas. Its product mix is very limited for a bank, offering only savings accounts and CDs. The lack of physical branches and ATM access is a significant drawback for an online bank, especially without ATM fee reimbursements.

Newtek Bank could be a good choice for individuals looking to park their savings and earn high interest rates. However, it's probably not suitable as a primary bank. 

Editorial disclosure: Opinions expressed are author's alone, not those of any bank, credit card issuer, or other entity. This content has not been reviewed, approved, or otherwise endorsed by any of the entities included in the post.