Max My Interest: Friend or Foe


Max My Interest, or Max for short, offers a cash management app that enables individuals and businesses to earn additional interest on their checking and savings accounts. The advantage for consumers? Max does automatically what most people are too busy (or lazy) to do for themselves, which is to shop around for the best rate.

Customers do not have to change banks to use Max. They simply link the app to their current bank and create savings accounts at other institutions through the setup process. From there, Max automatically transfers funds as market rates change, always ensuring that the cash in their accounts is earning the maximum yield. Max charges 0.02 percent per quarter on the cash being optimized, for a total of 0.08 percent per year

In theory, this sounds great. Max allows users to save smartly and earn a higher rate of interest on cash deposits with minimal effort. Max works directly with the largest institutions, including the likes of Bank of America, Wells Fargo and Citigroup, and uses an algorithm that transfers money between banks automatically. Since Max only utilizes other banks’ savings accounts, customer funds are FDIC insured despite the fact that Max itself is not a bank.

According to the website, the average customer earns 0.70 percent to 0.90 percent more with Max than they do at traditional brick-and-mortar banks, which can be significant–particularly for high net worth clients, who Max estimates keep nearly a quarter of their portfolio in cash. In addition to individual accounts, Max offers services to wealth management professionals, and to businesses.

Signing up isn’t exactly as easy as 1-2-3. A new user must create multiple savings accounts, one for each bank it wants to be able to transfer funds to, which is time consuming—although once that has been done, everything happens automatically thereafter. We are also leery of products that require the user to give a third party access to their existing bank account because that increases their security risk.

This is a tough call. Although Max could be considered a potential friend for big banks or banks with high savings account rates, what it comes down to is this: Do they really want aggressive rate shoppers who are always chasing the highest possible yield, which is what Max will bring them. And if you do happen to be a bank that pays out a higher rate, don’t you still want a relationship with the consumer that includes more than just their deposits? If so, partnering with Max may not be the best way to maximize your interest.

Bank Director Staff Writer