It’s not a given that anyone can open a regular checking account. About 7.7% of American households, or almost 17 million people, are unbanked, and part of the reason involves having bad credit or poor banking histories.
Making mistakes with a bank account, such as not paying overdraft fees, can put you on a list to let other banks know you’re a risky customer, and you might be denied an account because of it.
We give our highest recommendation for the best-in-class institutions that offer a second chance bank account.
Best Second Chance Checking Accounts
Chime Bank is a fast-growing internet-only bank. Unlike big banks, Chime was created during the smartphone era and, therefore, features an app that is more than just a way for customers to review their bank accounts.
And, best of all, Chime Bank accepts all customers who apply. Even if you have bad or poor credit or have been blacklisted by ChexSystems or credit bureaus. It’s one of the only guaranteed checking accounts we’ve ever reviewed and is available in all 50 states.
- FREE Visa® debit card
- NO monthly fees or service charges
- NO monthly minimums
- FREE online banking and mobile banking/deposits
- NO fees at over 38,000 MoneyPass® and Visa Plus Alliance ATMs worldwide
- SAVINGS: You can round up every purchase to the nearest dollar and automatically deposit that difference into your savings account.
The Peoples Cash Solutions Second Chance Checking Account might be the answer for you. Peoples Bank will open an FDIC insured Second Chance Checking Account for you even if you have bad credit or have been reported to ChexSystems or TeleCheck in the past (except where fraudulent activity has been reported). Available in all 50 states.
- Debit MasterCard®
- Personal checkbook
- Online bill pay
- Online banking
- Online money transfers
- Monthly maintenance fee of $4.95
- $30.00 minimum deposit
The Radius Bank Essential Checking account is an FDIC-insured checking account designed to help you manage your money with powerful technology and limited fees. Available to residents in all 50 states.
- Free MasterCard® debit card
- Free mobile banking with check deposit
- Free online banking with bill pay
- $10 minimum deposit to open an account
- A monthly service charge of $9.00
- No minimum balance
- Ability to upgrade account after 12 months of responsible banking
Varo Bank is another internet-only bank with services based on their mobile apps for Apple and Android devices. Varo doesn’t charge fees at 55,000+ Allpoint ATMs and offers strong budgeting tools and automatic savings programs.
When you open an account at Varo you can do so with no initial deposit. Plus, there are never any monthly maintenance fees, foreign transaction fees, transfer fees, or debit card replacement fees.
Finally, if Varo receives a payroll notification before your payday, it can deposit your money more quickly than many banks.
Wells Fargo recently changed the Opportunity Checking account to Clear Access Banking. And we like one change, in particular. Wells Fargo has done away with overdraft and non-sufficient funds (NSF) fees. Clear Access Banking is a debit card-only account (no paper checks available) and if you attempt to purchase something without sufficient funds, the transaction will be denied. That’s a lot better than having the transaction approved and then discovering you’ve been hit with a $35 overdraft fee.
There is a $5 monthly fee, but that is be waived for account holders 24 years old and younger. This account is available to residents in all 50 states.
- The largest number of branches in the U.S.
- Minimum deposit of $25 to open an account
- Online bill pay and smartphone app
- Mobile check deposit
- Includes a Visa debit card
- Send and receive money through Zelle
- Additional features include account alerts, 24/7 fraud monitoring, and zero liability protection for your debit card
The Best Second Chance Banks by State
When people apply to open checking accounts, financial institutions screen them to determine how much of a risk they’ll be. About 85% of banks and credit unions in the United States use ChexSystems, a consumer reporting agency that gathers information on closed checking and savings accounts. Consumers with outstanding debts or overdrafts, fraudsters and victims of identity theft may have records on ChexSystems.
When a person with a ChexSystems record tries to open a checking account, it’s up to the financial institution to determine whether to approve that account. ChexSystems reports may or may not be used, as can credit reports.
When people cannot get bank accounts, their alternatives tend to be prepaid debit cards, payday loans, and check-cashing services, which aren’t always ideal because of transaction fees. They can also be much less convenient, since they may lack features such as online access to funds.
A second chance checking account, however, offers the security of a bank account while letting a consumer rebuild his or her banking history. After a year or two, an account holder may be able to upgrade to a regular checking account.
Unfortunately, some major banks don’t offer second chance checking, but many community banks and credit unions have them under various names, such as Opportunity Checking and Fresh Start Checking.
Some banks and credit unions offer so-called second chance checking accounts to help people rebuild their credit and financial histories. These accounts usually carry monthly fees and come with a few other requirements, such as participating in a financial literacy or money management class. An account holder might also not be eligible for overdraft protection, since second chance banking serves as a way to prevent overdrawing an account altogether.
Here’s an overview of these accounts and where you can find them at branches in your area.