Many Web sites can help you look for good rates on investments, but MoneyAisle.com says it can do better.
MoneyAisle, which launched this month, doesn't just compile rates from different banks. Instead, it has banks bid for the right to keep your CD or high-yield savings account.
It's similar to what Charlotte-based LendingTree does for loans, except MoneyAisle bidding is in real time, said Edward Woods, a senior analyst at Celent.
“It's Priceline for bank products,” Woods said.
To use MoneyAisle, you submit some very basic information - the state you live in, the amount of your investment, and the duration if it's a CD - and banks compete against each other to offer the best return. You can watch the auction unfold on your computer screen, where a graphic will tell you the number of banks and bids in each round, and of course, the increasing rate. It should take just a couple of minutes.
If you want to accept the winning rate, you provide your information and a bank representative contacts you. If the bank lets customers open accounts online, then MoneyAisle will take you to the relevant Web site.
MoneyAisle says it has a network of 72 bidding banks and hopes to reach 100 this summer. In South Carolina, it accepts bids for CDs and savings accounts. In North Carolina, it accepts bids only for savings accounts because of state regulations.
In its first week, MoneyAisle says, it facilitated $1 million in deposits.
There's no fee for consumers to use the site, and MoneyAisle says it's eager to help them get the best returns on their money and to help small and mid-sized banks reach clients across the country. It accepts no advertising; it makes money from subscription fees and new client fees from banks.
I asked for a bid on a $1,000, one-year CD in South Carolina and - after a quick 13 rounds of bidding from 53 banks - got an offer of 3.5 percent from Beacon Federal in East Syracuse, N.Y. That's slightly better than the national average of 3.18 percent, according to Bankrate.com.
Woods says MoneyAisle is another sign that consumer services offered by big banks “are being picked off one by one.”
“This isn't going to change the world any time soon,” he added. “But it's a sign that things are changing.”