Northern Bank Direct is the online banking division of Northern Bank, a community bank headquartered in Massachusetts that was founded in 1960. The online-based Northern Bank Direct provides certificates of deposit (CDs) and money market account options for savers. Competitive rates make it a worthwhile consideration for banking customers.

In addition to its banking products, Northern Bank Direct offers a health savings account and 1031 exchanges.

Here’s a closer look at Northern Bank Direct’s savings products and how it stacks up to similar online institutions.

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Account Basics

Money Market Account

Northern Bank Direct pays a competitive 4.95% APY on its money market account on balances up to $250,000. There are no fees to open this type of savings product with Northern Bank Direct, but it does require a somewhat steep $5,000 minimum deposit. If you can’t swing that minimum deposit, keep in mind that some banks have much lower minimum deposit requirements. This account offers check-writing and ATM privileges.

Northern Bank Direct is part of the SUM Program, which provides surcharge-free ATMs throughout the nation.

CDs

CD options from Northern Bank Direct come in a range of terms, from six months to 60 months. All of the bank’s CDs require a $500 minimum deposit.

Here are the current rates for Northern Bank Direct’s CDs:

APY

6 Months

5.00%
9 Months 5.00%

12 Months

5.60%

15 Months

5.40%

18 Months

4.75%
24 Months 4.50%
36 Months 4.00%
48 Months 4.00%

60 Months

4.00%

Notably, Northern Bank Direct offers two somewhat uncommon terms, including nine and 15-month terms. The rates on many of these CDs compete with some of the best CD rates offered.

Interest for CDs through Northern Bank Direct is compounded and credited on a monthly basis.

Early withdrawal penalties from the bank vary by term. For terms less than 12 months, you’ll be charged six months of interest, and for terms 12 to 35 months, you’ll be charged 12 months of interest for withdrawing early. The penalty moves up to 24 months’ interest for CD terms of 36 to 47 months. It increases to 36 months for terms of 48 months or greater.

Distinguishing Features

Northern Bank Direct offers several ways to access the cash in your money market account. You can make a withdrawal by check, ATM, online electronic funds transfer, telephone transfer and wire.

The ability to make transactions in person at a Northern Bank branch is another feature that’s useful for customers in Massachusetts and the surrounding area. Many online banks don’t offer the ability to bank at a branch.

Access on the Go

Since it’s an online bank, customers of Northern Bank Direct have 24/7 access to online and mobile banking.

The financial institution’s mobile banking app is available on iOS and Android. It allows customers to check account balances, transfer funds and make check deposits. On the Android version, users can also pay friends and family with People Pay. Neither version of the app gets top-notch scores, but the Android version (2.8 out of 5 stars) rates higher among users than the App Store version (1.5 out of 5 stars).

Those located near a Northern Bank branch can make a transaction for their Northern Bank Direct account in person, which provides customers with a little more convenience than other banks that operate strictly online.

Pros

  • Competitive money market account rate
  • Branch access for customers located in the New England region
  • Money market account check-writing and debit privileges
  • No monthly maintenance fees

Cons

  • Only offers two banking product types
  • Relatively high money market minimum deposit requirement

How Northern Bank Direct Stacks Up

Northern Bank Direct’s money market account rate and CD rates are higher than yields found at many other online banks. This makes it an option mainly for consumers interested in opening a money market account or CD. In addition to a competitive rate, its money market account offers perks like check-writing privileges, an extended ATM network and 24/7 account access.

Northern Bank Direct also isn’t a full-service bank, which puts it at a disadvantage to many other top online banks, which may offer additional services like checking, credit cards and loans.

Current customers of Northern Bank seeking online banking combined with branch access may get the most benefit from opening an account at Northern Bank Direct. The ability to make transactions in person isn’t an option that many online banks offer.

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Frequently Asked Questions (FAQs)

Is Northern Bank Direct FDIC insured?

Yes, Northern Bank Direct is FDIC insured (FDIC# 18266). All products from Northern Bank Direct are insured by the federal government up to $250,000 per depositor, per account ownership category. You’re protected in the event of a bank failure.

Does Northern Bank Direct have any branches?

No, Northern Bank Direct is an online bank and doesn’t maintain branches. However, since it’s a division of Northern Bank, customers of the online institution can choose to make transactions in person at a Northern Bank branch in the New England region.

What do I need to open an account at Northern Bank Direct?

In order to open an account at the online institution, you’ll need to gather the following personal information:

  • Address
  • Date of birth
  • Driver’s license number
  • Social Security number

In addition, you’ll need the account and routing number of the institution you’ll be using to fund your CD or money market account.