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CIT Bank is an online bank that offers good rates with no monthly service fees – and it definitely ticks a lot of the boxes for millennials.
But despite these attractive features, CIT Bank is still surrounded by a lot of uncertainty. Potential users are unsure about the bank’s safety, trustworthiness and reputation – and I think that’s perfectly understandable.
After all, the first thing we need to make sure before we trust any bank with our savings is that it is reliable and that our money is in good hands.
Because my inbox is full of emails with questions like “is CIT bank safe?” and even “Is CIT a real bank?”, I think there’s no better time than now to address this.
I can assure you – CIT bank is as real as you and I, but I understand why some people would think it isn’t. The bank takes a very different, online-only approach to banking – and is nothing like your traditional bank (which is awesome, but it can also cause some users to doubt its legitimacy).
In this CIT Bank review, I’ll be covering the ins and outs of this online bank – and clearing up any confusion. You’ll find out what CIT bank is, who it’s owned by, whether you can trust it with your money – and what its most attractive features are.
What is CIT Bank?
CIT Bank is an online-only bank that offers:
The competitive rates CIT bank offers make it a top choice for anyone looking to earn interest on their savings.
With CIT Bank’s Premier high-yield savings accounts, you get 1.55% APY with a minimum opening deposit of only $100. The money market account offers 1.85% APY, again with a minimum opening deposit of $100, while certificates of deposit offer up to 1.85% APY for an 18-month term.
It’s worth mentioning that CIT Bank also offers CD options with more flexibility.
Because CDs are low-risk investments designed to be long-term, it’s not uncommon to have to be penalized for withdrawing your money before maturity (i.e., the date when you’re officially allowed to withdraw your funds).
With a No-Penalty, 11-Month CD offered by CIT Bank, you won’t get penalized for accessing your funds early if you need to – and you’ll still get excellent earning potential (1.75% APY).
That’s pretty awesome because you can lock in a great long-term investment rate – but know you could dip into your savings if you needed to.
The latest exciting addition to the bank’s savings account options is the Savings Builder – a savings account that allows you to earn up to 1.80% APY on your money. To qualify for the highest APY, you will need at least $25,000 (or you can commit to depositing $100 each month and build your savings).
The downside of CIT bank is that it doesn’t offer checking accounts – so you will have to look elsewhere if you want an everyday banking account.
The Highlights of CIT Bank:
- Online-only bank with no physical branches
- No monthly fees
- Competitive interest rates on high-yield savings accounts (1.55% APY), money market accounts (1.85% APY), and certificates of deposit (up to 1.85% APY; minimum deposit – $1,000)
- Newest addition – Savings Builder account (impressive 1.80% APY)
- Certificates of deposit come with extra flexibility (no-penalty to access funds)
- Low minimum deposits for savings and money market accounts
Who is CIT Bank Owned By?
CIT Bank is owned by CIT Group – a financial holding company that has been around since 1908, and has approximately $50 billion in assets, as of September 30, 2019. CIT Group is headquartered in New York City, and CIT bank is CIT Group’s subsidiary.
CIT stands for Commercial Investment Trust – which was the name the company initially used.
The company can be divvied up into two segments – commercial and consumer banking. Its commercial segment offers commercial financing, equipment financing, real estate financing, factoring, and railcar financing.
CIT’s consumer banking segment is where CIT Bank – the company’s national online bank – sits. CIT also owns award-winning OneWest Bank, which is their Southern California branch bank. Unlike CIT Bank, OneWest Bank is a regional bank with over 60 physical bank branches.
Interesting Fact: CIT is going to be acquiring Mutual of Omaha as part of its strategic growth plan. Details of the $1 Billion (with a B) transaction can be found in this press release.
Is CIT Bank and Citibank the Same?
Time to clear up the confusion! Citibank and CIT Bank are two different institutions. They may have similar-sounding names – but their names and the fact that they are financial institutions are probably the only two things they have in common.
Citibank is a consumer division of Citigroup – a multinational investment bank and financial services corporation founded in 1812.
CIT Bank, as mentioned before, belongs to CIT Group – a financial holding company.
Is CIT Bank Safe?
Security is a major concern for anyone who is looking to switch banks – but CIT Bank takes its security seriously.
The bank has several strict measures in place to protect your private information, prevent fraud, as well as keep your information safe and secure.
CIT Bank’s Security Features:
- Transaction and activity monitoring. CIT Bank monitors your transactions and activity to help spot any suspicious behaviors.
- 28-bit Secure Socket Layer (SSL) encryption. CIT Bank uses 28-bit SSL encryption to create a secure browser connection and prevent information from being intercepted.
- Antivirus protection. CIT Bank also uses antivirus protection, so that your computer systems stay virus-free.
- Firewall use. The bank uses firewalls to block unauthorized individuals from accessing your information on their systems.
- Secure messaging. CIT Bank has a secure messaging portal and uses communication encryption.
- Automatic sign-out. When you’re inactive for a set period of time, CIT Bank will automatically sign you out to prevent anyone else from accessing your private information.
As you can see, CIT Bank has various security measures in place to prevent fraud and protect your privacy – but it’s always important to make sure you’re doing your part.
Anyone visiting CIT Bank’s website also has access to these handy fraud prevention tips, which are worth checking out.
Is CIT Bank Federally Insured?
For those wondering whether CIT bank is FDIC insured, the answer is yes. The bank is an FDIC member, meaning that all deposit accounts held at CIT Bank are insured up to $250,000 per depositor.
The Federal Deposit Insurance Corporation (also known as FDIC) is an independent institution of the U.S. government – and it protects you against losing your money if your bank is FDIC insured.
So, what does the FDIC insurance over? It covers deposits received at CIT Bank, such as savings and time deposits (like CDs).
The insurance covers the balance of each depositor’s account up to the insurance limit (which is $250,000 per depositor for each ownership category) – and that includes the principal as well as any accrued interest.
However, it’s also important to know what FDIC insurance doesn’t cover – and that’s investments in stocks, mutual funds, bonds, municipal securities, life insurance policies, or annuities – even if you bought these from CIT Bank or any other bank insured by FDIC.
Your Savings Bonds, US Treasury Bills and Treasury Notes also won’t be protected by FDIC.
Knowing exactly how the insurance rules and limits apply to your bank account can be tricky – which is why FDIC has created the Electronic Deposit Insurance Estimator (EDIE).
The tool can assist you in calculating your FDIC coverage on your accounts – and determine whether your deposits are within or exceed FDIC coverage limits.
Another thing to note is that FDIC isn’t just an insurer – it’s also a backup supervisor for the insured banks and institutions.
It works to make sure the banks comply with consumer protection laws, including the Fair Credit Reporting Act, the Fair Credit Billing Act, the Fair Debt Collection Practices Act, and the Truth-In-Lending Act.
Is CIT Bank Trustworthy?
Earning customer trust is probably the single most important factor in determining a bank’s success.
It’s the only way to build long-term relationships with customers – and is much more important than any other features like high-interest rates, low minimum balances, or being able to bank on-the-go.
Knowing that the bank will protect your money and your data is paramount – so it isn’t surprising that people may feel a little skeptical about CIT Bank, and other online banks.
Online banks are quite a step forward in the banking industry – but it is also quite unnerving to think that if anything was to happen or if you had any pressing questions, you couldn’t pop into your nearest branch and speak to the bank’s representative face-to-face.
However, as you can see, CIT Bank does a lot to ensure its customers that it can be trusted – from taking several security measures, to having the additional layer of protection through FDIC insurance.
I personally think that there isn’t anything you can’t trust about CIT Bank – and there aren’t any red flags that need raising.
So, Is CIT Bank For You?
You will now find plenty of CIT bank reviews online (some more accurate than others!), but the message is clear – CIT bank is legit and is a great choice for those looking for a no-fee savings options with solid rates.
It takes customer security and privacy seriously, with many security measures in place to prevent fraud and ensure data protection. CIT Bank is also FDIC-insured, meaning there’s that additional layer of consumer protection.
That said, if you’re looking for a bank that offers personal service, CIT bank may not be the best option because it doesn’t have any physical branches.
But if you’re OK with that and are looking to park your savings somewhere that’ll earn you solid interest – CIT bank is well worth considering.