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Would you like to open a checking account, but you’re worried that your bad credit and past banking history might get in the way? With these issues, it can be difficult to open a new bank account.
17 Best Bank Accounts for Bad Credit
Regardless of your banking history, there are numerous banks and credit unions that offer bad credit checking accounts, all with unique features and benefits.
Subject to certain terms and limitations. Offer valid through October 31, 2024. Member FDIC.
Offer may not be available if you are an existing U.S. Bank customer or live outside of the U.S. Bank footprint.
The account includes a free debit card that can be locked or unlocked if ever misplaced or stolen. There are no ATM transaction fees at U.S. Bank ATMs and no surcharge fees at over 40,000 MoneyPass® Network ATMs.
The checking account requires a $25 opening deposit and a $6.95 monthly fee. This fee can be waived for those 24 and under, 65 and over, or military members (must self-disclose).
Additionally, the fee can be waived with monthly deposits of $1,000+, an average balance of $1,500+, or holding an eligible U.S. Bank credit card. Qualifying for any Smart Rewards® tier (Primary, Plus, Premium, or Pinnacle) also waives the fee.
With the SoFi Checking and Savings account, you won’t have to worry about monthly fees or overdraft fees.
For a limited time, customers can earn a bonus of up to $300 when they make qualifying direct deposits. This is in addition to the access SoFi provides to more than 55,000 Allpoint® Network ATMs.
You can also enjoy the convenience of receiving your paycheck up to 2 days in advance with SoFi’s early direct deposit feature.
SoFi stands out with its competitive annual percentage yield (APY) – a rewarding 4.50% on savings and 0.50% on checking balances, all with direct deposits. There’s no minimum direct deposit amount necessary to qualify for these rates.
First Tech Rewards Checking & Savings is an ideal solution for those looking for a rewarding banking experience without the traditional constraints. This account combines high-yield interest and multiple financial incentives within a single platform.
There are no minimum balance requirements and no monthly maintenance fees. One of the standout features of First Tech is its high interest rate, offering up to 4.00% APY on both the checking and savings account up to certain balances. This is significantly higher than many traditional and online banks.
Accessibility is also a key benefit, with over 30,000 CO-OP network ATMs available nationwide for fee-free withdrawals. Additionally, First Tech offers enhanced financial flexibility and peace of mind with features like real-time fraud monitoring and free overdraft transfers.
Current is one of the fastest-growing mobile banking solutions in the U.S., with over one million members. However, Current is a financial technology company, not a bank. Most importantly, Current does not use ChexSystems or pull your credit.
With Current, you can build your credit seamlessly, just by using your debit card on everyday transactions. The best part is that there is no credit check or borrowing involved.
Some features of the Current mobile app include fee-free overdraft protection of up to $100, 40,000 fee-free Allpoint ATMs, and no minimum balance or hidden fees.
You can also earn up to 4.00% APY on savings and get paid up to two days sooner with direct deposit. In addition, you can earn up to 15x points, and get cashback on debit card purchases.
With Chime®, a bad credit score is no longer a deal-breaker. They offer an award-winning financial app and debit card with 24/7 live support, with a real human.
You can open a Chime Checking Account online with no monthly fees. There are also no overdraft fees, no foreign transaction fees, and no transfer fees.
Chime also offers access to over 60,000 MoneyPass® and Visa® Plus Alliance ATMs. Plus, you can get your paycheck up to 2 days earlier with direct deposit. You can also deposit cash for free at over 8,500 Walgreens.
GO2bank is a neobank developed by Green Dot, is a neobank developed by Green Dot, a well-established fintech known for its prepaid debit cards and banking services.
The bank offers a checking account with savings subaccounts known as vaults, and the best part is that there is no minimum balance required to open an account online.
The savings account offers an attractive 4.50% APY on savings up to $5,000. Additionally, you can deposit cash at any of the 90,000 retail locations or withdraw funds from any of the 19,000 fee-free ATMs.
You can also use the mobile app’s check deposit feature to deposit checks directly into your checking account.
With direct deposit, you can even receive your pay up to 2 days early or your government benefits up to 4 days faster. Additionally, you can qualify for up to $200 in overdraft coverage with eligible deposits.
Responsible use of the GO2bank Secured Visa Credit Card can also help you build your credit over time.
If you receive a payroll or government benefits direct deposit in the previous monthly statement period, your monthly fee is waived. Otherwise, it is only $5 per month.
No monthly fee with direct deposits of $500 or more
Earn up to 3% cash back on purchases
Overdraft protection covering up to $200 with eligible direct deposits
2% APY on savings
The Walmart MoneyCard is a prepaid debit card that offers a robust alternative to traditional checking accounts.
This card stands out with its cash back rewards program, offering up to 3% cash back when shopping at Walmart.com, 2% at Walmart fuel stations, and 1% at Walmart stores, up to a total of $75 each year.
The account also covers up to $200 for purchase transactions with opt-in and eligible direct deposits.
The ASAP Direct Deposit feature is another great perk, allowing users to receive their pay up to two days earlier and benefits up to four days earlier.
Additionally, with the Walmart MoneyCard, you can earn a 2% APY on savings and have chances to win cash prizes each month. The monthly fee of $5.94 can be waived with a direct deposit of $500 or more in the previous monthly period.
Chase is one of the most popular banks in the U.S. And now, they offer an account called Chase Secure Banking that doesn’t use ChexSystems, and doesn’t charge overdraft fees.
Account holders also get access to over 16,000 ATMs, free online bill pay, and free money orders and cashier’s checks.
With 4,700 locations across the country, this is an excellent option for anyone who prefers having access to physical branches.
Opening a Chase Secure Banking account comes with a $100 cash bonus when you use the card for 10 purchases within 60 days.
Account approval is immediate, and you’ll receive your debit card within days.
If you are an active-duty or retired member of the military, including the Armed Forces, National Guard, Coast Guard, or Department of Defense, you may be eligible for Navy Federal Credit Union membership.
Navy Federal doesn’t utilize ChexSystems or EWS. They also offer a number of free checking accounts with no monthly service fees for those with qualifying direct deposits.
Additionally, NFCU offers its members convenient access to over 30,000 ATMs situated at both credit unions and retail locations across the United States and Canada through the CO-OP Network.
The TD Beyond Checking account from TD Bank offers a number of appealing features. It provides a flexible approach to avoid the $25 monthly fee: maintain a minimum daily balance of $2,500, have $5,000 in monthly direct deposits, or a combined balance of $25,000 in eligible TD accounts.
Additionally, account holders benefit from free access to a vast network of over 4,000 ATMs, enhancing the convenience of managing cash transactions almost anywhere.
For those who occasionally face financial hiccups, TD Bank offers a safeguard by reversing up to two overdraft charges per year, mitigating the potential financial stress from account overdraws.
Furthermore, the account offers the opportunity to earn interest on the balance held. Overall, the TD Beyond Checking account stands out for its mix of fee waivers, ATM accessibility, overdraft forgiveness, and the potential for earning interest.
11. Southwest Financial Federal Credit Union
Southwest Financial offers a range of bank accounts including savings accounts, CDs, and checking accounts to its members. Several checking accounts have no monthly fees. They come with features like mobile check deposit, online bill pay, overdraft protection, and more.
Opening an account is easy and does not require a minimum deposit. As a member of Southwest Financial, you enjoy the convenience of accessing your funds through a network of 55,000 ATMs that don’t charge fees.
12. Wells Fargo
Wells Fargo’s Clear Access Banking offers a practical, accessible second chance bank account designed to suit various banking needs. While there is a $5 monthly service fee for this checking account, the fee is waived for primary account owners aged 13 to 24.
With a minimal opening deposit of just $25, setting up Clear Access Banking is straightforward and affordable. As an account holder, you’ll have the convenience of accessing your funds through Wells Fargo’s extensive network of 13,000 ATMs and 5,300 branches across the country.
13. Cadence Bank
Cadence Bank offers the My Way Checking account, which is designed as an alternative to ChexSystems. To get started, you only need a $50 initial deposit.
The $8 monthly fee can be easily avoided by: maintaining a $250 daily balance, making five debit card purchases, receiving a direct deposit of at least $100, or being a student under 25.
Among the key features are online banking and bill pay, compatibility with mobile wallets, and 24/7 account information via a dedicated helpline.
While online statements are available for free, those who prefer paper statements will be charged a $2 fee. With these offerings, Cadence Bank presents itself as a versatile banking option.
14. United Bank
United Bank has locations in Maryland, Ohio, Pennsylvania, Virginia, West Virginia, and Washington, DC. You can open a new account with a $50 minimum initial deposit. There is no minimum balance requirement or monthly maintenance fee.
You can also upgrade to the Rewards Checking account, which allows you to earn cashback rewards. You also get discounts on movies, theme parks, and prescriptions. The monthly service charge is $10, but you can have it waived if you reach 15 purchase transactions monthly or have a minimum of $500 in regular deposits.
15. Huntington National Bank
Huntington has locations in Arizona, Colorado, Illinois, Indiana, Michigan, Minnesota, Ohio, South Dakota, and Wisconsin.
Huntington Bank uses ChexSystems, but you can still qualify for a checking account as long as you don’t owe the bank any money. However, applicants with an EWS record may not qualify.
For Huntington’s popular Asterisk-Free Checking account, there is no monthly maintenance fee, no minimum deposit, and no minimum balance requirement.
16. Varo
Varo is an online-only bank that offers a hassle-free banking experience with no monthly fees. As a Varo customer, you can get access to your paycheck up to two days early.
Additionally, Varo provides a Varo Believe Card, which allows you to build credit, access to over 55,000 Allpoint ATMs, and free paper check mailing services.
With the Varo savings account, you can qualify for up to 5.00% APY on deposits of up to $5,000, and 3.00% APY on any amount above that.
17. Regions Bank
You’ll need a minimum deposit of $50 to open a Regions Now Checking at Regions Bank. This checking account doesn’t come with too many bells and whistles. However, it’s a suitable option for anyone with a bad credit score who wants a basic checking account.
Regions Bank will lower your monthly maintenance fee from $8 to $5 if you sign up for online statements. And you’ll have the option to open a savings account through Regions Bank as well.
What is a bank account for bad credit?
A bank account for bad credit is tailored for individuals with an unfavorable banking history, often denied by traditional banks due to issues like bounced checks, overdrafts, and unpaid negative balances.
Bad credit bank accounts, provided by some financial institutions, include essential services such as debit cards, online and mobile banking, and check-writing abilities. Key advantages of these accounts are their ease of opening, low fees, and no credit checks or ChexSystems reports.
How Banks Evaluate New Account Applications
When applying for a bank account, banks have specific criteria to decide eligibility and the type of account offered. Your ChexSystems report provides them with an important insight into your banking history. This report contains details of past banking behaviors like unpaid balances, overdrafts, and any fraudulent activities associated with closed accounts.
A negative ChexSystems record can complicate account opening, leading to potential application rejection or restricted account types. Additionally, while some banks may review your credit history from major credit bureaus like Equifax, Experian, and TransUnion, they primarily rely on ChexSystems for bank account applications, unlike credit card issuers and lenders who focus more on your credit report.
What is ChexSystems?
ChexSystems is a consumer reporting agency used by banks to screen customers. It records your past banking activities, including overdrafts, bounced checks, unpaid fees, and negative balances. A negative record in ChexSystems can impact your ability to open a new bank account.
Some banks simply do not use ChexSystems as part of the application process. These banks offer no-credit-check bank accounts for people with bad credit or a negative banking history.
The good news is that these checking and savings accounts come with the same features as regular bank accounts offered to everyone else. You can expect to have access to online banking, debit cards, bill pay, and mobile deposit features, allowing for convenient management of your finances just like any traditional bank account.
Second Chance Bank Account
Second chance bank accounts offer individuals with a problematic banking history an opportunity for financial rebuilding. While these accounts, also known as opportunity checking or fresh start checking accounts, may involve a credit check or ChexSystems review, the focus is on giving the customer a new beginning.
They typically include a monthly maintenance fee. Similar to regular bank accounts, overdraft protection, mobile check deposit, and online bill pay are often available. Responsible use of a second chance checking account can lead to an upgrade to a standard checking account.
What to Look for in a Bad Credit Checking Account
If you’re an individual or a small business owner struggling with poor credit history and seeking a checking account that aligns with your needs while aiding in rebuilding your financial reputation, here are some key factors to consider:
No credit checks: Look for banks or credit unions that don’t use your credit report or ChexSystems record when opening a checking account. Many also offer “second chance” or “fresh start” checking accounts tailored for individuals with poor credit or past banking issues, providing an opportunity to rebuild your financial standing and potentially upgrade to a traditional checking account later.
Low or no minimum balance requirement: Look for accounts without minimum balance requirements to avoid fees and maintain more of your funds, which is important when rebuilding credit.
Reasonable account fees: Pay attention to the fees associated with checking accounts, especially relevant for those with bad credit. Compare monthly fees and other common fees. Many online banks offer accounts with minimal or no monthly fees, sometimes contingent on maintaining a minimum balance or setting up direct deposit.
Online and mobile banking features: Ensure the account offers features that allow you to check your balance, transfer funds, pay bills, and deposit checks remotely.
Account alerts and notifications: Opt for accounts with customizable alerts for low balance, large transactions, or unusual activities. This feature helps in tracking spending and avoiding potential overdraft fees.
Overdraft protection: Seek accounts that offer this feature to minimize the impact of overdraft fees, a significant consideration for people with bad credit. Some banks may offer linked accounts, lines of credit or small-dollar loans as options to cover overdrafts, which can prevent high fees and additional financial strain.
FDIC or NCUA insurance: Confirm that the account is insured by the Federal Deposit Insurance Corporation (FDIC) or the National Credit Union Administration (NCUA). This insurance protects your deposits up to $250,000 per account holder in the event of bank or credit union failure.
Bottom Line
Having poor credit doesn’t mean you can’t get a bank account. But, it does mean that your selection will be relatively limited. We also show you how to clear your name and remove yourself from ChexSystems so that you can get a bank account anywhere.
Rebuilding your financial standing will take time. Meanwhile, some of the banks we’ve listed above offer bank accounts that are just as good, if not better, than anything currently available on the market. So, it’s a good idea to start with one of those.
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