You can be denied a loan for having a bad credit report, but did you know you can also be denied a bank account if you have a negative banking history?
Many banks use reports from ChexSystems, a consumer reporting agency, when deciding whether to let someone open a checking account or not. Similar to a credit report, a ChexSystems report documents your banking history. If you’ve had too many bounced checks, overdrafts, unpaid balances, or suspected fraudulent activity, there is a chance a bank could refuse to let you open an account.
If you’re concerned that negative marks in your banking history may cause a bank to block you from opening an account, rest assured there are other options. You may want to consider banking with a financial institution that doesn’t use ChexSystems records.
In this article, we’ll look at 12 of the best banks that don’t use ChexSystems and may be more likely to accept customers with less-than-perfect banking histories.
U.S. Bank is a good second-chance banking option because its Bank Smartly checking account has tools to help improve financial wellness. With the U.S. Bank mobile app, account holders can track their spending, set goals, and schedule alerts for when a bill is due or their account is low on funds. It’s also a good choice if you prefer a traditional bank rather than a strictly online one — it has branches in 26 states.
The Bank Smartly account at U.S. Bank enables you to link to an eligible account for overdraft protection and also offers an Overdraft Fee Forgiven program, which waives fees on overdraft transfers that exceed $50.
There are no monthly maintenance fees for military members and customers 24 years old and younger and those 65 and older. The monthly maintenance fees can be waived for customers who meet certain requirements, such as having monthly direct deposits of at least $1,000 or maintaining a minimum balance of $1,500 or more, among others.
U.S. Bank is FDIC insured.
Chime is a financial technology company. You can open online accounts through Chime that have no overdraft fees, monthly service fees, minimum balance requirements, or foreign transaction fees.7
Chime doesn’t use ChexSystem reports or credit reports in the decision-making process for new customers. And you can open an account through Chime with no initial deposit. With a Chime Checking Account, you can make withdrawals from over 60,000 fee-free ATMs and get paid up to two days early with direct deposit. 5 6
Accounts you open through Chime are FDIC insured through its partner banks The Bancorp Bank and Stride Bank.
Varo also doesn’t use ChexSystems, and credit reports don’t factor into your application for a new account.
Varo banking accounts have no monthly fees, no overdraft fees, and no minimum balance requirements.
You can also open a Varo account with no money. Your money could be earning interest up to 5.00% (as of Aug. 29, 2023) APY in a Varo high-yield savings account with direct deposit. And, if your credit is less than stellar, Varo’s Believe card could help you build your credit back into good standing.
Its mobile banking has good reviews, with 4.7 out of 5 stars in the Google Play Store and 4.9 out of 5 stars in the Apple App Store.
Varo is FDIC insured.
SoFi is an online financial company that enables you to earn up to an 4.50% (as of Aug. 2, 2023) APY on your savings account and 0.50% (as of Aug. 2, 2023) APY on a checking account when you use direct deposit.2 8 3 That is well above the national average savings rate, and banks rarely offer interest-earning checking accounts.
SoFi doesn’t pull your ChexSystems report when you apply to open an account, making it a good choice if you have negative marks in your banking history. There are no monthly fees, no overdraft fees, no minimum opening deposit requirements, and no minimum balance requirements, and you could also get your paycheck 2 days early when you sign up for direct deposit.9
You can even earn up to 15% cash back when you use a SoFi debit card for purchases at select local establishments.4
SoFi memberships also include other perks like career coaching and financial planning.
SoFi is FDIC insured.1
Wells Fargo Clear Access
Wells Fargo’s Clear Access Banking is specifically geared toward people who have had issues opening accounts at other banks due to their banking history. This second-chance checking account comes with a $5 monthly service fee, which is waived for customers between 13 and 24 years old or who have a Wells Fargo Campus ATM or Debit Card linked to the account.
You’ll need $25 to open a Clear Access account, after which no minimum daily balance is required. There are no overdraft fees; however, Wells Fargo won’t authorize transactions if you don’t have enough money in your Clear Access account. Although Wells Fargo offers overdraft services, those services aren’t available for Clear Access Banking accounts.
Wells Fargo is a national bank with a presence in many states, so if having access to branch locations is important to you, this could be a good choice. If you’re in the Midwest, Oklahoma, or Louisiana, however, it may not be the best option for branch access.
Wells Fargo is FDIC insured.
Navy Federal Credit Union
If you are an active duty or retired member of the armed forces or Department of Defense or are related to someone in the military, you may be able to open an account at the Navy Federal Credit Union, and the credit union doesn’t run a ChexSystems report when you apply for an account.
Navy Federal Credit Union offers five different checking accounts for you to choose from, all of which have no monthly service fee or minimum balance requirement. Navy Federal Credit Union members also get free access to their TransUnion credit score and can manage their credit health through the credit union’s Mission: Credit Confidence dashboard.
Navy Federal Credit Union is insured by the National Credit Union Administration (NCUA).
GO2bank is an online non-Chexsystems bank that charges a $5 monthly fee for accounts, which can be waived with eligible direct deposits. There is no minimum balance required to open a GO2bank account online, and you can withdraw your money at thousands of ATMs across the country.
Opt-in overdraft protection of up to $200 is available for GO2bank customers who set up eligible direct deposits. You’ll have to bring your overdraft balance to $0 within 24 hours to avoid fees.
Need to rebuild your credit? The potential is there with GO2bank's secured Visa credit card. No credit check is required for the card, but you will need direct deposits totaling at least $100 in the past 30 days to be eligible.
Accounts with GO2bank are insured by the FDIC.
Current is a fintech company that was founded in 2015 with the goal of being “the future of banking.” It offers accounts that help build your credit, and it doesn’t require credit checks or banking history reports from ChexSystems to open an account.
With Current accounts, there are no minimum balance fees, no in-network ATM fees, no monthly fees, and no bank transfer fees. You can make ATM withdrawals at over 40,000 fee-free Allpoint ATMs and get fee-free overdraft protection with qualifying direct deposits.
Like most online financial companies, Current enables you to get paid up to 2 days faster with direct deposit. The company also provides a high-yield savings account with 4.00% (as of May 23, 2023) APY.
Accounts opened through Current are FDIC insured through its banking partners Choice Financial Group and Cross River Bank.
You may be familiar with Acorns as an investment platform, but it also provides online banking accounts, which are included with all Acorns subscriptions. Acorns subscriptions start at $3 per month.
Banking on Acorns simplifies using the platform’s round-up feature to invest your spare change instantly. You can also automatically invest part of every paycheck you receive.
Acorns checking accounts have no hidden fees, no minimum balance fees, no overdraft fees, and you could get paid 2 days early with direct deposit. The Acorns Visa debit card can be used fee-free at over 55,000 ATMs within the AllPoint network.
Acorns Checking Accounts are FDIC insured.
Green Dot Bank
Green Dot Bank’s Unlimited Cash Back account enables you to earn 2% cash back on your mobile and online purchases. With a Green Dot Bank account, you manage your account primarily through the Green Dot app. You can use the app for mobile check deposits and cashing, online bill pay, and to track your spending.
Overdraft protection up to $200 is available with eligible direct deposits on Green Dot Bank accounts, but you must opt in. Green Dot also offers high-yield savings that earn 2.00% (as of Jul. 27, 2023) APY interest annually on up to $10,000.
Green Dot Bank is FDIC insured.
Sable is designed to help non-U.S. citizens establish themselves in the U.S., but Sable’s benefits are available to U.S. citizens and non-citizens alike. Opening an account through Sable doesn’t require a credit check or ChexSystems banking history.
Debit card accounts opened through Sable provide unlimited 1% cash back on select brands and have no annual or monthly service charges, no overdraft fees, and no minimum deposit requirements. Sable is one of the best checking accounts for non-U.S. citizens because they can apply for an account with a passport or visa if they don’t have a Social Security number.
Sable accounts are FDIC insured through its banking partner Coastal Community Bank.
United Bank Gateway Checking
While it offers several types of checking accounts, United Bank’s Gateway Checking account is designed especially for people with poor credit scores and bank history.
This second-chance checking account won’t use your ChexSystems report or credit report in the application process. However, there is a monthly maintenance fee of $10 on the account, and it doesn’t include a debit card or overdraft privileges.
You’ll also be charged $34 on each insufficient funds transaction, and if you bounce more than two checks in a month, the bank may close your account.
You can open an account online, but its branch locations are only in Alabama and Florida.
United Bank is FDIC insured.
FAQs about banks that don't use ChexSystems
What is the process to open an account with a bank that doesn't use ChexSystems?
The process to open an account with a bank that doesn’t use ChexSystems isn’t much different than a bank that does. Many financial institutions enable you to open an account within minutes online.
Several banks that don’t use ChexSystems provide customers with a secured credit card or prepaid credit card that requires a deposit of a certain amount before you can use it.
Are there hidden fees at banks that don't use ChexSystems?
Many of the financial institutions we looked at that don’t use ChexSystems don’t have hidden fees, but that’s not to say other banks won’t charge hidden fees. When opening any account, it’s important to look at a bank’s fee schedule. The best banking accounts come with no monthly fees, no maintenance fees, no overdraft fees, and no minimum balance requirements.
Can you still be denied an account at a bank that doesn't use ChexSystems?
Yes, you can still be denied an account at a bank that doesn’t use ChexSystems. Banks decide who they provide services to and under what circumstances. For example, you may be denied an account if you can’t verify your identity with a Social Security card, passport, or other government-issued document. Federal law requires banks to identify and verify a person’s identity when they open an account.
You may have difficulty opening a bank account if you have negative marks in your banking history, like bounced checks, unpaid balances, or overdrafts. Many banks use the ChexSystems reports on your banking history to determine if you are a high risk for them to take on as a customer.
However, several banks offer second-chance bank accounts for customers with less-than-stellar banking histories. Many of these banks or financial technology companies that don’t use ChexSystems offer online accounts with benefits like no monthly fees, no minimum balance requirements, and fee-free overdraft protection.
Opening an account at a bank that doesn’t use ChexSystems can be a good way to help you rebuild your financial wellness and get your banking history back in good standing.
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