Discover vs Ally 2026: Battle of the Online Banks
Two of the most popular online banks go head-to-head. Both offer no fees, competitive rates, and excellent apps. Here's how to choose.
⚡ Quick Verdict
- • You want the $200 sign-up bonus
- • You want 1% cashback on debit
- • You value best-in-class app
- • You use Discover credit cards
- • You want savings buckets
- • You want higher APY (3.70%)
- • You prefer stability (no acquisition)
- • You want CDs with easy options
| Feature | Discover | Ally | Winner |
|---|---|---|---|
| Savings APY | 3.60% | 3.70% | 🏆 Ally |
| Sign-Up Bonus | $200 | None | 🏆 Discover |
| Cashback Debit | 1% (up to $3K/mo) | None | 🏆 Discover |
| Savings Buckets | ✗ No | ✓ Yes | 🏆 Ally |
| Fee-Free ATMs | 60,000+ | 43,000+ | 🏆 Discover |
| Mobile App Rating | 4.8★ | 4.7★ | 🏆 Discover |
| No-Penalty CD | ✗ No | ✓ Yes | 🏆 Ally |
| 24/7 Support | ✓ Yes | ✓ Yes | Tie |
| Checking Account | ✓ Yes | ✓ Yes | Tie |
The Capital One Factor
Before we dive deep, one major consideration: Discover is being acquired by Capital One. The $35 billion deal is pending regulatory approval as of January 2026.
If the acquisition closes:
- Discover accounts will likely migrate to Capital One
- Rates may change (Capital One currently offers 3.50%)
- Features like cashback debit may be discontinued
This doesn't mean you shouldn't choose Discover—the current product is excellent—but it's worth knowing the future is uncertain.
Ally faces no such uncertainty. It's a stable, independent bank with no acquisition on the horizon.
APY: Ally's Small Edge
Ally currently pays 3.70% APY vs Discover's 3.60%. On a $25,000 balance:
The difference is modest—$25/year on $25,000. Both are excellent rates.
The Cashback Debit: Discover's Unique Edge
Discover is the only bank offering 1% cashback on debit purchases—up to $3,000 in purchases per month.
If you spend $2,000/month on debit: $240/year in cashback
That's significant—far more than the APY difference. However:
- Only works on signature (credit) transactions, not PIN
- Credit cards typically offer better rewards and protections
- May not survive the Capital One acquisition
If you prefer debit over credit cards, Discover's cashback is a genuine differentiator.
Savings Buckets: Ally's Killer Feature
Ally lets you create savings buckets within a single account—separate goals with individual targets:
- Emergency fund: $20,000 goal
- Vacation: $5,000 goal
- New car: $15,000 goal
All buckets share one account, earn the same APY, and can be easily reorganized. It's genuinely useful for organized savers.
Discover has no equivalent—you'd need multiple accounts to separate goals.
CDs: Ally Offers More Flexibility
Both banks offer CDs, but Ally has more options:
- No-Penalty CD: Withdraw anytime after 6 days, no penalty
- Raise Your Rate CD: Increase rate if Ally raises rates
- Standard CDs: 3-month to 5-year terms
Discover offers standard CDs only. If you want CD flexibility, Ally wins.
Mobile Apps: Both Excellent
Both apps are highly rated:
- Discover: 4.8★ (iOS), 4.6★ (Android)
- Ally: 4.7★ (iOS), 4.5★ (Android)
Discover has a slight edge in ratings and is often praised for its clean, intuitive interface. But both apps are excellent—this shouldn't be a deciding factor.
ATM Access
Discover: 60,000+ fee-free ATMs + $30/month out-of-network fee reimbursement
Ally: 43,000+ fee-free ATMs + $10/month out-of-network reimbursement
Discover wins on both network size and reimbursement. If you frequently use ATMs, Discover offers better access.
The Final Verdict
This is genuinely close—both are excellent banks. Our recommendation:
Choose Discover if:
- You want the $200 bonus (for $25K deposit)
- You'll use the 1% cashback debit
- You value the best mobile app experience
- You're okay with acquisition uncertainty
Choose Ally if:
- You want savings buckets to organize goals
- You prefer the (slightly) higher 3.70% APY
- You want CD flexibility (no-penalty option)
- You prefer a stable, independent bank
Can't decide? You can always open both—they're free with no minimums.