What to Do When You Can't Open a Bank Account - NerdWallet (2024)

FAQs

What to Do When You Can't Open a Bank Account - NerdWallet? ›

If you are denied a bank account, verify your application details, review consumer reporting records and consider banking alternatives. Margarette Burnette is a NerdWallet authority on savings, who has been writing about bank accounts since before the Great Recession.

Common reasons consumers are turned down for a bank account include a history of overdrafts, unpaid bank fees or suspected fraud. Applications can also be denied due to mistakes on one's checking account report. If you've been denied a bank account, ask the bank why this happened.

A second-chance program can be a good option for people who are unable to open a traditional checking account, but it's important to make sure the financial institution is reputable. Stick with a bank that's insured by the Federal Deposit Insurance Corp.

Negative information such as overdrawn accounts, nonsufficient funds, unpaid fees or having your account closed may prompt a bank to deny your checking account application, but you won't get dinged for having less-than-stellar credit.

Chime Second Chance Banking

Chime is an online-only fintech company that offers banking services through The Bancorp Bank, N.A. or Stride Bank, N.A. Its Second Chance Banking option boasts no monthly fees and no credit or ChexSystems check.

You may open a “second chance” account, which is designed for those with a poor banking history. Alternatively, you could search for a bank that does not make decisions regarding customer accounts based on ChexSystems reports. Expired fees and debt must be repaid.

Consider a reloadable prepaid card if you don't have a checking account. Prepaid cards can be useful for managing your money if you have a variable income, and many do not charge overdraft fees. They also may offer fraud protection and transaction monitoring to protect your money from suspicious activity.

Which bank does not use ChexSystems? ›

Yes – and not just banks. Anyone who can order a credit report on you can see how much debt you owe and to whom.

How long does negative information stay on ChexSystems and/or EWS consumer reports? Generally, negative information remains on ChexSystems and/or Early Warning Services (EWS) consumer reports for five years. Under the Fair Credit Reporting Act, certain negative information may be reported for up to seven years.

Request your report

The report shows a breakdown of specific accounts closed, outstanding debts, bounced checks and more. You're eligible for a free copy of your report once every 12 months. Request your record in one of these ways: Call ChexSystems at 800-428-9623.

Chex Systems, Inc. (ChexSystems®) is a nationwide specialty consumer reporting agency under the federal Fair Credit Reporting Act (FCRA).

Savings Bank accounts cannot be opened by a minor (Below 10 years), a lunatic , a drunkard not in his senses as well as a declared Bankrupt person.

You can be denied an account if you're in debt to another bank because of an overdrawn account or overdraw your account too often.

Don't worry—while it can be more difficult, it is not impossible to get approved for a new bank account with bad credit. A bad credit score is considered a VantageScore^® of 600 or lower and a FICO^® score of 670 or lower.