Top 11 Banks That Don’t Use ChexSystems
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If you’re having trouble opening a bank account, it’s likely that you’ve been blacklisted by ChexSystems due to poor banking history. Because an estimated 80% of all banks use ChexSystems to screen new applicants, it can be extremely hard for you to get a new checking account at commercial banks.
Luckily, there are plenty of banks out there that don’t use ChexSystems. These banks won’t know about your prior banking history, so you’re much more likely to get approved for an account. In this article, we’ll offer 11 of the best non-ChexSystems banks in the country and answer frequently asked questions about ChexSystems.
The Top 11 Banks That Don’t Use ChexSystems
To help rebuild your banking history, here are 11 of the best non-ChexSystems banks.
Chime’s mission is to make banking helpful, easy, and free for everyone. As a result, they do not run your credit or check your ChexSystems report when you apply to any of their checking and savings accounts.
Chime is technically not a bank. Instead, they are a relatively new financial technology company that offers banking services provided through The Bancorp Bank, N.A. and Stride Bank, N.A., meaning that their products are still FDIC insured. Here’s why you should consider their Chime Checking accounts and Chime Savings accounts.
BBVA (now under PNC), offers a personal checking solution called VirtualWallet. VirtualWallet comes with no monthly fees and a $0 minimum deposit to open.
VirtualWallet also has a set of digital tools that can help you stay on top of your finances. For example, the Low Cash Mode feature allows you to set alerts when your account drops below a certain balance so you avoid overdraft fees.
SoFi Money is a FDIC-insured banking account that comes with a debit card and doesn’t check your ChexSystems history. You may be eligible for a $100 welcome bonus when you sign up.
One unique feature with SoFi Money is their “early paycheck” feature, which may allow you to get your paycheck up to 2 days earlier than usual. If you have set up direct deposits of $1,000 or more per month, you’ll also get SoFi’s Overdraft Coverage, which covers you up to $50 for overdraft fees.
Acorns is another bank that doesn’t use ChexSystems to screen applicants for their Acorns Checking product. Acorns comes with a clean mobile app that has all your personal checking information in one place.
Acorns is perhaps best known for their focus on savings and investments. In addition to Acorns Checking, consider opening an investment account. With Acorns Investing, they’ll help round up your spending to the nearest dollar and invest that amount into stocks.
LendingClub is another bank that doesn’t use ChexSystems for new checking accounts. They do perform a soft-pull on your credit to verify your identity, but they will not be able to see your past banking history.
LendingClub’s High-Yield Savings account currently pays one of the nation’s top rates at 0.60% APY on balances of $2,500 and up. There are also no monthly service fees or minimum balance requirements after you deposit the initial $100 required to open the account.
Navy Federal Credit Union
If you are part of active-duty or a retired member of the military, you are eligible for a checking account at Navy Federal Credit Union. They do not use ChexSystems.
In addition to paying regular APY interest on checking account balances, Navy Federal Credit Union also pays dividends. This can range from anywhere between 0.01% to 0.45% APY depending on the account you sign up for.
Current officially considers themselves a financial technology company instead of a bank. They offer mobile banking solutions, and do not use ChexSystems to determine your eligibility.
Their focus on mobile makes banking with Current extremely convenient. You’ll get a push notification anytime you swipe your card and can manage your funds anywhere from your phone. In addition, you could earn up to 15% cash bank at over 14,000 participating merchants if you use your Current debit card.
United Bank offers checking accounts with no minimum balance requirements or hidden fees. Their most popular account is the United Free Checking, which doesn’t depend on your ChexSystems history for eligibility.
United Bank also offers a Rewards Checking and a Platinum Checking account. However, Free Checking is still the best option for rebuilding your banking history because there are no monthly service fees or minimum balances.
SunTrust (now Truist) offers checking accounts that come with a handy MasterCard Check Card. They have two main accounts to choose from: Advantage Checking and Essential Checking.
We recommend the Essential Checking account for starters, since you only need to make $500 or more in direct deposits per statement cycle to qualify for $0 maintenance fees. Essential Checking also caters to students, who enjoy no monthly fees for the first five years.
Renasant Bank is a great option for those living in Mississippi, Tennessee, Alabama, Georgia, and Florida. Rather than look at your ChexSystems history, the only criteria for their checking account is that you don’t owe any money to Renasant Bank. Thus, for new clients, it’s easy to open a new account.
Renasant Checking has a relatively low opening balance requirement of $50. You can avoid all monthly maintenance fees by enrolling in eStatements or by maintaining a daily balance of $1,000 or more.
Peoples Cash Solutions
Peoples Cash Solutions primarily offers second chance accounts, giving those with poor ChexSystems records another chance at banking. There is no account opening fee or application fee.
While you do have to pay a mandatory $4.95 monthly service fee, there are no minimum balance requirements with Peoples Cash solutions. You also get a free MasterCard debit card with your account.
What Is ChexSystems?
ChexSystems is a consumer reporting agency that stores and reports information about your previous banking history. When you apply for a new checking account, the bank can request your checking history with ChexSystems to decide whether to approve or deny you.
ChexSystems is very similar to credit reporting agencies like Experian, TransUnion, and Equifax. However, instead of reporting on credit-related accounts, ChexSystems reports on deposit-related accounts, including checking and savings accounts.
Because many banks use ChexSystems, having a poor checking history means most commercial banks will probably reject you when you try to apply for a new account. To get around this, consider Chime or any of the other banks above that do not pull your ChexSystems history.
How Does ChexSystems Work?
Unlike the credit reporting agencies which record both positive and negative items on your credit report, ChexSystems generally only reports negative items about your past checking history. Negative items can remain on your ChexSystems report for up to five years.
Based on your ChexSystems report, ChexSystems also generates a score, similar to a credit score. Your ChexSystems score can range from 100 to 899, where 100 is considered the highest risk. It’s unclear exactly how ChexSystems calculates your score, as they keep this information internal.
Banks regularly report checking information to ChexSystems. That way, when you apply for a new account with another bank, they can simply pull your ChexSystems score to see if you’re deemed high-risk.
Because ChexSystems only records negative information, it’s possible that you don’t have a ChexSystems report or score if you have a clean banking history. However, if you do have a low ChexSystems score, in can be incredibly hard to become approved for a regular checking account.
Can I Dispute Errors on My ChexSystems Report?
Every 12 months, you can obtain a free copy of your ChexSystems report. If you suspect that something is incorrectly reported, you can dispute those errors with ChexSystems.
Under the Fair Credit Reporting Act (FCRA), ChexSystems is obligated to investigate any disputes that you submit. If they cannot verify the negative information with the relevant bank or financial institution, they must remove the item from your report.
How Do I Remove Errors on My ChexSystems Report?
A negative error on your ChexSystems report may be the reason banks are denying you from opening new accounts. To remove these errors, follow the next three step process.
Obtain a Free Copy of Your ChexSystems Report
As we mentioned earlier, you’re entitled to a free copy of your ChexSystems report every 12 months. This is officially stated in the Fair and Accurate Credit Transactions Act of 2003 (FACTA), an amendment to the FCRA.
To obtain your report, visit the Chexsystems website where you can submit an online request. This is the most convenient way to get your report, and you can choose between online delivery or delivery by mail. Some other ways to request your report include:
- By Telephone: You can reach ChexSystems support at (800) 428-9623. Customer service representatives are available Monday through Friday between 8am and 7pm Central Standard Time.
- By Mail: You can fill out a physical copy of the Consumer Request for Disclosure Form and mail it to ChexSystems at the following address:
Chex Systems, Inc.
7805 Hudson Road, Suite 100
Woodbury, MN 55125
- By Fax: You can also fax the Consumer Request for Disclosure Form to (602) 659-2197.
Once you have your report, review it thoroughly. Make a list of the potential items that you want to dispute.
Use the ChexSystem Online Dispute System
Disputing an item with ChexSystems is easy. They have a web page dedicated to submitting a dispute where you can include details about your request. For each dispute, you’ll need to provide the following details:
- Type of Information. Most of the time, this will be under the “Reported Information” category.
Source of the Dispute. This is the name of the company that reported the disputed information.
Date on the Disputed Information. You can get this directly from your ChexSystems report.
Additional Details. This is your opportunity to describe the dispute and why you think the information is incorrect.
If you prefer, you can also submit disputes via mail or fax using the same contact information as in step 1. When disputing via mail or fax, you must include your Social Security number and your ChexSystems Consumer ID (found on your report) for identification. You must also provide your current address.
Once ChexSystems receives your dispute request, they have 30 days to complete an investigation. They will report the results of the investigation by mail to the address you provided.
If ChexSystems is able to successfully remove the item, congratulations! You can try applying for a new bank account. Otherwise, move on to step 3.
If Unable To Remove, Consider Paying Off Reported Debts
If ChexSystems is unable to remove your item, it likely means that the item was correctly reported by the bank or financial institution. However, there is still a way to remove these items if they’re damaging enough to your ChexSystems score.
Starting with the most recent item, reach out to each bank that reported a negative item. Even if you’ve had a bad history with them, many banks are flexible when it comes to paying off the balance. Some banks may even be willing to waive some or all of the charges.
Depending on your financial situation, you can negotiate with the bank to see if you can work out a way to settle the balance. You can pay off the balance in full, or work with the bank to come up with a payment plan.
After paying off the debt, be sure to let the bank know to report this information to ChexSystems. It’s also good to reach out to ChexSystems and verify that your record was updated.
Do I Even Need a Checking Account?
If you are getting constantly denied due to a bad ChexSystems history, you may be wondering whether it’s still worth the effort to try and get a checking account. In almost all cases, the answer is yes. Here are some reasons why having a checking account is so important for your financial wellbeing.
Safe Place To Keep Your Money
A checking account offers a safe place to keep your money. This also gets rid of the need to carry around large amounts of cash.
In addition, most bank accounts are FDIC-insured. This simply means that in the event your bank goes bankrupt, your money (usually up to a maximum of $250,000) is protected from loss. Make sure that any bank you sign up for, ChexSystems or non-ChexSystems, comes with FDIC-insurance.
Access To Other Useful Banking Features
Checking accounts come with a variety of essential banking features. The most basic feature is that you can easily see your account balance and transaction history. This allows you to verify transactions and see how much money you have at a moment’s notice.
Another essential feature is a debit card. All checking accounts should come with a debit card that is linked directly to your account. This makes it easier for you to make payments without having to carry cash.
Here are some other key features of banking that you could take advantage of with a checking account:
- Direct deposit
- Ability to make money transfers
- Earn interest on your money
- Mobile banking
- Access to ATMs, often with no fees
- “Low Balance” alerts
- Automated savings
- Customer service options
What Is The Difference Between Non-ChexSystems Banks and Second Chance Banking?
A non-ChexSystems bank is exactly what it sounds like: the bank does not take your ChexSystems history into account when considering your application.
On the other hand, second chance banking may or may not look at your ChexSystems history. However, second chance banks are willing to overlook poor banking history and open an account anyway, hence the name “second chance” banking.
In general, non-ChexSystems accounts come with all the features you’d expect from a regular checking account. Many accounts do have monthly fees, but these can be waived by fulfilling certain criteria, such as maintaining a certain minimum balance.
Second chance bank accounts usually have more restrictions than non-ChexSystems accounts do. For example, there may be a mandatory monthly maintenance fee and strict minimum balance policies. The good news is that after 12 months of good standing, you can usually upgrade your second chance account to a regular checking account.
If you keep getting denied by regular banks, it’s worth pursuing both non-ChexSystem and second chance bank accounts as alternatives.
What Should I Look For in a Non-ChexSystems Bank?
When considering non-ChexSystems banks, look for the following features:
- FDIC insurance. Opt for banks that provide standard FDIC insurance of up to $250,000.
- Debit card. This should be included with your account.
- Low or no monthly fees. In general, look for accounts where you can waive the monthly fee by maintaining certain criteria. If there’s no way to waive the fee, a reasonable monthly fee is no more than $10.
- Overdraft protection. The better banks will alert you when your balance is low, and automatically deny any transaction if you have insufficient funds.
- High-interest yield. This is definitely considered a bonus, but many of the top non-ChexSystems banks out there pay a high-interest yield on your balance. You may consider this to get an extra boost in your savings.
- Sign-up offer. Another bonus to consider is the sign-up offer. Some banks may give extra incentive by offering a cash bonus upon opening a new account.
How Do I Fund My New Non-ChexSystems Account?
Once your new non-ChexSystems account is opened, it’s important to fund it right away. This is because most non-ChexSystems accounts will have a minimum initial deposit requirement. You also just want to verify that you can make deposits and withdrawals from your account with no issues.
There are usually a few ways to fund your new account. If you have an existing account, you can simply do a wire transfer.
However, most of the time you won’t have another account, so you can use a prepaid debit card or Paypal to add money into your account. If you have your debit card, you can visit an ATM to deposit cash. Finally, you also can mail in a money order.
After you’ve made the deposit, ensure that your deposit shows up in your transaction history. If your account has a daily minimum balance, be sure to never go below that amount!
Best Practices For Managing Your Non-ChexSystems Account
Here are some tips for managing your new non-ChexSystems checking account.
Always Keep an Eye on Your Account Balance
Proper money management always starts with the account balance. Make it a habit to always become aware of this number and never let it drop below the minimum balance! Doing so will also help you in many other aspects financially, such as staying on top of your bills and budgeting properly.
Regularly Review Bank Statements
Each month, your bank will release a statement showing your current balance along with all recorded transactions. You can use this summary to determine your average monthly spending, and use that for future budgeting.
Also, you should use these statements to verify all transactions. If anything is incorrect, contact your bank immediately.
Sign Up For Banking Alerts
Many non-ChexSystems bank accounts will allow you to set up alerts. We recommend setting up the following, if available:
- “Low Balance” alerts. Get notified when your balance drops below a certain threshold to avoid going below the minimum balance requirement.
- Identity fraud alerts. Most banks are able to detect when a payment is made that wasn’t authorized by you. This can help you detect when you’ve been a victim of identity fraud or if your account was hacked.
- Transaction alerts. If you’re new to banking, we highly recommend setting up an alert every time you make a transaction with your account. This helps constantly remind you of your account balance and gives you a continuous record of your transactions.
Know When You Can Apply For Other Accounts
Having a checking account is a great start. However, to give yourself more financial opportunities, you should be on the lookout for other accounts that you can apply for.
As you continue using your non-ChexSystems account, be sure to keep it in good standing. If you maintain a positive history, your ChexSystems record may be clean enough to pursue a regular account. You may decide that having another checking account isn’t necessary. However, definitely consider the following account types:
- Savings Accounts: Whereas checking accounts are used for regular daily expenses, a savings account is designed to be a rainy day fund that you try not to touch except in emergencies. When considering savings accounts, it’s best to go with one that pays a high-yield interest rate.
- Investment Accounts: For long-term financial growth, consider an investment account to start looking into stocks, bonds, and index funds.
- Retirement Accounts: Retirement accounts are tax-advantaged accounts that you can contribute regular savings to.
Alternatives to Non-ChexSystems Accounts
Anybody who is unable to get a regular checking account should try to get a non-ChexSystems checking account instead. However, you could also consider the following alternatives.
Second Chance Banking
As we discussed previously, second chance banking is where a bank is willing to overlook your ChexSystems record. Second chance banking is another great way to rebuild your banking history.
Note that with second chance bank accounts, you could face additional restrictions such as lower daily maximum withdrawal limits. There could also be a lower maximum spending limit per transaction.
Prepaid Debit Cards
A prepaid debit card is like a regular debit card that isn’t attached to a bank account. To deposit funds into a prepaid debit card, you can visit retail stores like Walmart or Walgreens. You should avoid using a prepaid debit card at an ATM, since they could be subject to high fees.
In general, having a bank account is still better than using a prepaid debit card. You could face a small transaction fee every time you use or deposit funds.These fees are easily avoided by using a non-ChexSystems bank account instead.
Secured Credit Cards
A secured credit card is very similar to a prepaid debit card, with a few additional advantages. Most notably, transactions on a secured credit card report to the three credit bureaus, so you can use it to improve your credit score. However, in terms of improving your banking history, a secured credit card won’t do much.
Conclusion and Next Steps
Non-ChexSystems bank accounts give everyone the opportunity to sign up for a checking account. With the long list of benefits of owning a checking account, there’s no reason not to sign up for one of these accounts.
In particular, we recommend checking out Chime and their Savings account. In addition to providing a safe place to store your money, you’ll earn an industry-leading interest rate on your balance.
Our Top Pick for Banks that Don't Use ChexSystems is Chime.
When doing research, Credit Help Info relies on credible and authoritative sites. These research sources are provided so that you can see exactly where we get our information.
Chime is a financial technology company, not a bank. Banking services provided by The Bancorp Bank, N.A. or Stride Bank, N.A., Members FDIC.
1. There’s no fee for the Chime Savings Account. Cash withdrawal and Third-party fees may apply to Chime Checking Accounts. You must have a Chime Checking Account to open a Account.
2. Chime SpotMe is an optional service that requires a single deposit of $200 or more in qualifying direct deposits to the Chime Checking Account each month. All qualifying members w overdraw their account up to $20 on debit card purchases and cash withdrawals initially, but may be later eligible for a higher limit of up to $200 or more based on member's Chime Ac deposit frequency and amount, spending activity and other risk-based factors. Your limit will be displayed to you within the Chime mobile app. You will receive notice of any changes to may change at any time, at Chime's discretion. Although there are no overdraft fees, there may be out-of-network or third party fees associated with ATM transactions. SpotMe won't c transactions, including ACH transfers, Pay Anyone transfers, or Chime Checkbook transactions. See Terms and Conditions.
*The Annual Percentage Yield (“APY”) for the Chime Savings Account is variable and may change at any time. The disclosed APY is accurate as of November 17, 2022. No minimum balance required. Must have $0.01 in savings to earn interest.
The average national savings account interest rate of 0.21% is determined by FDIC as of November 17, 2022 based on a simple average of rates paid (uses annual percentage yield) by all insured depository institutions and branches for which data are available. Visit National Rates and Rate Caps to learn more.
About the Author
Chris Morgan is a credit expert and founder of Credit Help Info. He has been featured in Addition Financial, GOBankingRates, MSN Money, Yahoo Finance, and many other publications. He has read hundreds of books and resources on finance and the credit industry. Because he did this, you don’t have to. As a school teacher for over 20 years, Chris enjoys taking complicated material and breaking it down into manageable information that’s easy to understand.