Tue, 15 Apr 2008

Washington Mutual External Accounts

Washington Mutual online banking allows the addition of external accounts for ACH transfers. It is an extremely useful feature.

I recently opened an HSA at another bank. That bank is out of state. I wasn't looking forward to mailing checks to make deposits and writing checks on the HSA to reimburse myself for medical expenses. The external accounts feature makes that all unnecessary. I can transfer funds between my WaMu accounts and my HSA from the WaMu website without ever licking a stamp or signing a check.

To verify ownership of an external account, WaMu makes two small deposits of less than a dollar (then yanks them back out with a single withdrawal). When the deposits appear in your external account, you confirm the account on the WaMu website by entering those amounts.

I first saw this technique used by PayPal. Now it seems to be a standard account confirmation method.

If WaMu just offered OFX as one of the transaction download formats, I'd give them a perfect score.

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