4 Options When You Can’t Open a Bank Account

According to CNN Money, about 15% of bank account applicants are denied regular savings and checking accounts because of their banking history. Banks usually get information about this history from a company called ChexSystems, which maintains a file of information on your checking account history similar to your credit report.

ChexSystems, which is governed by the Fair Credit Reporting Act just like larger credit reporting bureaus, simply record negative banking account information. Items like non-sufficient funds overdrafts and unpaid bank account liens will stay on your report for up to five years.

So if you’ve made checking account mistakes in the past – especially issues like frequent overdrafts or unpaid obligations – you may be denied when you apply for a new savings or checking account. In addition, some banks pull your credit report and will deny your application if your credit score doesn’t meet their requirements.

If you do get denied, don’t worry, though; you’ve got plenty of alternative options.

Find Out Why You’ve Been Denied

The first step you should take when you’re denied a checking account is to figure out why you’ve been denied. Under the Fair Credit Reporting Act, banks are required to tell you why you’ve been denied a bank account.

The most likely reason to be denied an account is that you’ve got an outstanding debt with a bank – often because of unpaid bank fees. But you may also be denied because of a history of frequent overdrafts. Just ask the bank who has denied you exactly what the issue is.

Your next step is likely to check out your ChexSystems report, which you can access at ConsumerDebit.com. Like your credit reports, you can get one free copy of your ChexSystems report every twelve months. The report will show which bank or banks have reported you and why.

If you owe a bank money according to your ChexSystems report, you’ll need to either negotiate with the bank you owe to pay off the debt, or dispute the report as inaccurate.

If you pay off your debt with a bank, they’ll have to report the account as paid to ChexSystems, which may help your case next time you apply for an account. If the report is wrong, you can talk to the reporting bank first. If they refuse to deal with the matter, dispute the information with ChexSystems, who is required by law to investigate the claim.

The fact of the matter is that it can take months – or even years – to clean up your ChexSystems report. In the meantime, you may need to take advantage of other bank account options so that you can pay your mortgage on time and avoid hefty transfer or cashier’s check fees.

Consider Alternatives

1. Alternative checking accounts

As companies seek to reach out to unbanked or underbanked Americans, more are coming up with tempting checking account alternatives. These alternatives often come with lots of features and low fees, though you’ll want to do your research so you know exactly what you’re getting into.

Chime offers a terrific online savings and checking account geared toward savers.  Using the Chime checkbook feature, you can send checks to anyone you wish; fee free.

There are no account opening fees, no monthly maintenance fees and the only fee you’re likely to incur is ATM fees for using a network not in the Chime network.

Another great benefit of Chime banking is that you can get paid 2 days earlier with direct deposit.  Your money doesn’t get stuck in “electronic limbo” as Chime puts it.

To open a Chime banking account, there is no credit check.  When approved, you’ll have access to a Chime Visa Debit Card, a Spending Account and an optional savings account should you need one.

Read More: Chime Bank Review – Fee-Free Banking

Bluebird from American Express is another terrific alternative.  This card is very similar to a checking account. It lets you may direct deposit, use online bill pay, and even write checks.

Bluebird is also unique in that it lets you set up family sub-accounts, so you can give your teenager or another family member limited access to your Bluebird funds.  The fee structure is quite palatable; there are no monthly maintenance fees or annual fees and no fees to add cash to your card when done so at Walmart (or by Direct Deposit).  The fee that is likely to impact you the most is that if you upload cash at a non-Walmart location, the cost is $3.95.

You can also send money between Bluebird accounts if you need to but there are fees attached to that as well. (Up to $16 for sending $2,500).

2. Prepaid cards

Prepaid cards were once known for their outrageous fees, but they’re becoming much more reasonable in recent years. Many prepaid cards function very similarly to checking accounts – even allowing for automatic paycheck deposits.

Be sure you research prepaid card options to ensure that you’re getting the best possible deal – especially when it comes to fees. And be sure you choose a card with the basic functions you need most, whether that’s paying bills online or getting gas at the pump.

Apply Now

The Netspend® Visa® Prepaid Card offers cardmembers a variety of feature that makes it one of our favorites.  You can use Netspend Direct Deposit to get paid 2 days faster than other direct deposits and there are never any late fees or interest charged because this isn’t a credit card.

During tax season, you can get your refund deposited directly onto your Netspend® Visa® Prepaid Card.  And, there’s a mobile app that will help you manage your account and receive text messages and alerts.

3. Secured credit cards

A secured credit card is a good way to build your credit, which may help you get a checking account in the future. With these cards, you pay a deposit up front. The deposit is held by the card issuer in case of default. Sometimes these deposits also earn interest like a checking account.

Secured credit cards generally have a very low credit limit and a high interest rate. But if you use a secured card to pay your bills each month, paying it off at the end of the month, you won’t have to worry about interest.  One thing to note: you’ll need to be sure you have a way to actually pay off your secured credit card if you don’t have a bank account!

Learn More

Capital One issues our favorite secured credit card.  The Capital One® Secured MasterCard® can offer you the opportunity to improve your credit score while using a credit card for any everyday purchase you need.

The minimum deposit to open the account is either $49, $99 or $200 and after that, the card acts like a a regular credit card (with a low credit limit).

The annual fee for this card is $0 so it won’t cost you anything if you pay your balance off regularly.  And, after a while, Capital One will look at your history and potentially bump you up to an unsecured credit card with a reward program and higher credit limit.

Not to mention, while using this card responsibly, Capital One will report to all 3 major credit bureaus, which is likely to improve your credit score.

4. “Second chance” checking accounts

One final alternative to a traditional checking account is a second chance checking account. These accounts include most of the same features as regular checking accounts – checks, ATM access, online bill pay, debit cards, money transfers, and direct deposit.

The main difference is that these accounts often come with higher annual/monthly maintenance fees or require a larger opening deposit. Basically, these accounts are set up to give consumers a “second chance” while protecting the bank from losing too much money.

Some banks that offer second chance checking accounts don’t even check your ChexSystems file. Others will require that any outstanding balances from old banks (reported in your ChexSystems file) be paid off before you can get a second chance account.

A second chance checking account can be a good way to establish a better bank account history, and can often lead you into a lower-fee, traditional checking account within a few months to a year.

Topics: Banking

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77 Responses to “4 Options When You Can’t Open a Bank Account”

  1. Valerie

    So uhhh Aspiration is a HYBRID BANK ACCOUNT. Meaning, you cannot use them unless you already HAVE A BANK ACCOUNT.
    I would love to be wrong about this.

  2. fifth third bank has a great ‘express checking’ account if you are in chexsystems. you cannot write checks, but you do get a debit card, are able to cash or deposit checks, get direct deposit, etc. i still use walmart for buying money orders because they are much cheaper than banks. but the fifth third bank account is fantastic with no monthly fees or minimum balance. they make it impossible to overdraw your account and after a year or two, you are eligible for a regular checking account. i personally like going into an old-fashioned bank to a counter with a teller…i don’t like conducting all of my personal affairs online. woodforest bank also has second chance checking with the use of actual checks. but they charge almost $10 per month so you risk the chance of being overdrawn or incurring fees if your balance falls below $10, which may put you back in the same cycle that got you put in chexsystems in the first place.

    • I just called and they did say they check ChexSystems for that one too. I’m going to go into the bank tomorrow and see, crossing my fingers. My ex husband decided to over draw my last account -$600 when he started doing drugs behind my back- he wasn’t on my account but we were married. He took my debit card without me knowing and went through the atm several times in one night. I went to police- they said it’s not right but it’s the law and the bank should do something- went to the bank they said it isn’t right the police should do something. Anyways i was able to prove in court it was him and they ordered him to pay it but of course he hasn’t bc he can’t keep a job. So here i am trying to find a bank account and embarrassed as ever. Hoping this will work out! Thanks for the info. Xo

  3. Randy

    My Walmart money card got hacked. It was never out of my possession, No one had my pin. It was used 3 times on May 10th in Ohio at a gas station and a Dollar General in Columbus Ohjo. I have never been to Ohio. I filed a dispute and a police report but Green Dot which runs the Walmart money card has denied my claim. I want to find something other than a bank that my money is secure at.

    • Hey did you ever get this resolv3d? I had the same exact thing happen to me. $1000 was taken and it took me months to get it back. I had to call every company on there to try and get my money back. They got my card info online and used it in NY.

  4. Larry Mann

    I read some people with past scams victims such as mine that how to appeal to open a new bank account that they denied me for the rights then I noticed that it takes five years to clear up my name to credit union or top bank systems?

  5. Josh McKnight

    Ok so this is kinda conplicated…. but my dad has a bank account where only his name is on it, he is taking his income, my income, and my 2 brothers incomes, my questions are, do I have rights to money on a account that’s not technically mine, and can he sale stuff I’ve paid for against my will

    • Hey, if the account is in his name only then the answer is no. Banks are not even supposed to allow the deposit of checks that are not made out to the account holder. But if you made his account your direct deposit account they don’t check it. As for the sale of your stuff if you are a minor then yeah he can sell it. Hope this helps.

      • Robert Hare

        Actually, the child (even if they are a small child of any child old enough to reach the cash register counter), if they have a receipt or proof something *they* purchased in their own name, then no parent (or anyone else for that matter) may sell, seize, limit the use of or any other way restrict their use or possession of said item[s]) in any way shape or form, they are, indeed, the sole legal property of said child, period.

  6. christopher sheehan

    so a prepaid cc like wmmc is the same as a checking account…yes? i mean it has a routing number and an account number…doesnt it?….or is the account number only good for direct deposit?….so if i wanted a merchant account and needed a checking account….would the wmmc work?…that is couldn’t a processor deposit to the “checking account”….and debit from the same “checking account”?

    • Lola1969

      The bluebird prepaid debit card has checking account. You can order your checks from them when activating the account. Its perfect. You buy the card at walmart it is actually american express national bank. Hope that helps.

  7. Dana Kennington

    Over 5 years ago my ex applied for all those new “cash call” ads on TV and used my second chance account to do it -so when they went into my account to take their “fee” to qualify it was rejected do to non sufficient funds so when that happened practically in one day they closed my account- in the interim my ex and I broke up so it took me a while to figure out what the hell happened. It’s been well over 5 years since it happened – and not to long ago I applied for a checking account and got denied. Ugh so frustrating not to mention soooooo incredibly humiliating. I’m not used to be categorized as someone who can’t even qualify for a damn checking account. I’ve never used government assistance even though I’ve certainly qualified for it when I was out of work and virtually homeless – I pride myself in being an extremely hard working citizen and very loyal to boot. I’ve always been in the sales/customer service industry and actually love what I do. But god damn can’t a girl catch a break? I feel so stuck. I’ve read on here check systems keeps your bad account history for 5 years – since it’s been over that time think I can walk into a bank now and open a normal human banking account? Help or advice would so be appreciated

    • Not likely, just not yet that is. I have a similar situation as I fell victim to a fraud scam in San Francisco 3 years ago. I had two accounts opened in my name. These banks, Wells Fargo and Bank of America, offered overdraft protection. The accounts had $50 deposited in them and immediately the ATM cards were used to deposit $200 and withdrawal $400, essentially making $150 off each transaction and leaving me owing $200 bucks to each bank. BUMMER.
      At any rate, though your situation has been over 5 years ago, I know for certain they hold on for longer than that. My advice…you have several options. (1) Get a second chance account as you had before. Many banks offer this and you’ll have a ‘normal human account’ in no time. (2) Online banking. Chime and American Express Bluebird are great options with virtually no fees but ATMs out of network. And Chime has a better interest rate than most traditional banks. Or (3) Do your research. And what mean by that is wherever you reside, check your local banks and especially credit unions, there are more places that don’t use the check sytems that traditional banks use than your aware of.
      If this doesnt give you any hope for normalcy in the banking world there always Netspend or your mattress! LOL

  8. Kenneth ashby

    You can have your cheksystems reports removed there is company that will remove them guaranteed or money back an this includes EWS for 700 dollars consumer filing service i have spoke with them there very cutious

  9. Carole Lee

    My account was recently changed off and I can’t get another account till I pay off what I owe. I am receiving some money from family soon it’s a check for a lot of money to get back on my feet. Can you suggest what I can do so I can pay off my credit cards and bills I have with this check

  10. Tiffany

    I am getting married soon, and my fiance already has a checking account. Will he be able to add me to his account if I owe another bank, and have been reported to chexsystems? I have made arrangements with the bank to payoff what I owe them, and I am making payments.

      • Try opening one with Capital one 360, that’s what I did and I have been using it for the last 4 years without an issue. Its actually the best bank I have ever used and its completely online. You can still deposit check, you just can’t deposit straight cash. You could however get a money order or certified check from a bank to deposit the cash as a check to the 360 account.

        I owed a bank like $100 from years ago when I had some issues around 2010. I opened the 360 checking and savings in 2014.

        • I just got denied a 360 checking account minutes ago because of Chexsystems. By Google it said they don’t run you through chexsystems but that’s why they said they denied me. So… This was definitely a problem which is incredibly unfortunate. I really wanted that fee free checking account. My bank now US Bank has a lot of fees. Even their fees have fees. Its ridiculous. I hope it works for everyone who applies though. Seems like a great oppurtunity and even build interest.

          • I just opened a cap one 360 account after my second debit card transaction the account was frozen and i could not get to my money and all i was told is they cannot keep my account open and that they will send me my money back in the mail i cant get it from the local cap one branch …. these banks are shadey and shadier i will not use one ever again i am sure there are better ways to store my money maybe i missed something somewhere but whats the real advantage of a bank account i will be perfectly content with a credit card and one of those prepaid cards its all the same really and the chances of losing your money when the bank decides to go bankrupt and then inform you that FDIC doesnt have the money to cover what they claim they will cover ….. these banks should treat us like royalty if it was not for our money they wouldnt be shit. They use our money to invest and give us zero say in what they do with it ….

      • Patti Clark

        I’m not sure what to do . I am on the chex cashing system since 2013 . I then opened an account at a bank that was at Walmart 0 problem. However I was not able to use the debut card at atm to deposit or withdraw money I live in Phoenix and the bank was in Texas . That made it very difficult to deposit or get money when I wasn’t near I believe the bank was in Walmart. Then they started over drafting my account I told them 3 times not to let anything go through if it would overdraft the account . I got 5 overdraft charges on .38!cents that they let go through which Over drafted my account then the other 4 they let go through added up to $180!in late fees . I was so frustrated I never went back so I’m sure this has been reported as well . I recently opened a business and I have been only accepting cash & Payppal however, I don’t know what my best options are to be able to accept credit cards and be able to get the cash out for me . Right now if I accept PayPal I can only use this money to purchase something else with PayPal. I have been turned down with all the banks locally even a second chance account with 2 of the banks . I want to be able to grow my business I don’t know what to do . I would appreciate any help advice with this huge problem please ….

    • You should be able to. I know from experience. Also, Credit Unions don’t run the same system as a regular federal banking system. I owe Chase $6k & BOA a few hundred & was still able to open an account with a CU well after I had done some fraudulent activities to both those accounts.

  11. I’m stuck… I did a fraud on my Bank of America account 6 months ago I owe them 3600 and don’t know if I should pay it full.. bc if I pay it, does it give me a chance to open another account or do I have to wait 5 years

      • Tiffany

        Who exactly do you mean by “they” have to clear you? I actually have a current fraud fight with my bank they refunded money then took it back and now I owe them 5k not to mention the cc debt as well…. they closed my accounts and I can’t open with anyone else… I’m interested in this.

  12. Cilenia

    I can’t open a bank account I got scam I opened an account with Bank of America but they had closed it cause l didn’t know it was use for frauds checks was put in my account is their any solution I can do to clear my statement so l can clear it up

  13. Breanne

    I have also had trouble with opening a checking account because of past negative banking history and it really stinks to have to deal with this, trust me I know!! I do however have multiple savings accounts with my credit union but they would not let me open up a checking account, I also got declined at some other banks for a checking account as well. So, I searched around and I decided to go with E*trade Securities/Bank I opened up an Individual Brokerage Account which is essentially an investment & checking account together in one. I can do online bill pay, get a free debit card, write checks, no minimum balance and best of all no monthly fees! Also, I never have to worry about ATM fees. You can use your ATM card at any ATM in the US and when/ if you incur fees E*Trade will always refund them back to you. The only downside that I was not aware of before signing up is that you will NOT get your debit card until you have accumulated your first $1,000 in deposits to the account, but as soon as you do that you will get your debit card! Oh and one more thing their customer service is open 24 hours/7 days a week. Check Them Out!

  14. Sandra C

    I have recently closed out a savings account with United cumberland Bank and tried to open a checking account with People’s Bank and trust and they said I was denied and I have contacted Chex system to get y report but I am nervous for the wait. Why could I have been denied?

  15. Stephanie

    Chase Liquid! Chase offers a prepaid debit card for a fee of $ 4.95 mo. Loading your card is always free and they treat you as a regular customer. Only your money does not earn interest and you cannot write checks.

  16. I opened a 360 money market account at Capitol One and there is a glitch in their software that does not allow a joint account. They said it could take up to a month to add my husband’s name t the account. What if I die in the meantime does this account go to probate? What a joke-is there any recourse of action to this situation?

  17. Jason D

    I had owed a bank $1,300 and they closed my account 3 years ago, now I paid off my debt, and on chexsystems it states that I’m paid in full. What are my chances of opening a new checking account at a new bank, since my record will stay on chexsystems for 5 years?

    • Franchesca Knight

      Request a letter from the bank and take w you to any bank. We did this and had no issues opening 2 different accts on the same day. Good luck!

    • Carri Brown

      Bank of internet, they’re awesome if you are like me and couldn’t get a regular bank account due to overdrafts by the dozen and owing 3 banks a thousand + each

        • I got one from Wells Fargo after overdrafting both Chase and BOA. It took me a year of having to overdraft fees in my Wells Fargo account and they graduated me to a full/regular account. I also got a secured card with them and the graduated that to a regular credit card and gave me all my money back. It has been great with them although they catch a lot of flack. After my account became “regular,” I then opened up another checking account with a local bank in my state TX called Frost Bank… no issues. Good luck. There is also Chime and a lot of other online banking systems now that might work.

  18. I was recently asked upon opening a checking/savings account at a local credit union if I owed back taxes to the IRS. As I’ve had an IRS installment agreement in place for so-o long, I became used to the debt and marked the question as ‘no.’ It was later upon reviewing my packet at home that I read some of the questions and realized that I did owe the IRS but yet was being handled. What should I do about this? I was going to change my agreement to pull from the new credit union. Thanks.

  19. Niannza

    I’m a victim of a scam and sent back the money to the scammer and now I can’t opens an account anywhere I don’t have any credit and have tried all of these option I want to fix my problem but I need help

    • Common sense

      Good luck getting answers here. This is a bank sponsored website. Banks don’t provide actual valuable assistance. They provide canned responses, with canned smiles. They are terrible! My advise – use bitcoin!

  20. Jeffrey Bryant

    BlueBird from American Express started out okay for the first six months, then they slipped fees in that caused things to be returned. They did that again the first of this month. My only income is around $1,000/ month from VA. I cannot work because of a disability caused during deployment. BlueBird has again locked my U.S. Treasury deposit and suspended the account for no apparent reason, they won’t budge & my utilities are getting turned off in two days. Avoid them.

  21. I turned 18 in December and tried to open a student checking account with BB&T. I was denied because there was some kind of problem with “credit”, but that cannot be as I have never used credit or even had a bank account. I am so upset because this was going to be my first bank account ever and I’m entering the workforce soon. Can anybody help me by telling me what to do. I called ChexSystem and I received my report. I don’t know how to proceed.

    • Stephanie Colestock
      Stephanie Colestock


      Did you find any negative items on your ChexSystems report? Have you also checked your (free annual) credit report? If all is clear and you have no negative accounts (fraudulent or otherwise), then I would call and talk to BB&T. Perhaps the lack of credit is their concern, and you may need to build up your history a bit before opening an account with them.

      If this is the case, there are a number of other banks that would likely allow you to open an account with a limited history. Capital One 360 is usually a pretty good starter account, though there are many others… especially if you open online. Here are some of our favorite — and FREE — online banks: https://www.doughroller.net/banking/free-online-checking-accounts/

      Let us know if this works or if you have any other questions. Best of luck with the first bank account, and the beginning of your personal finance journey!


  22. Cutiepii89

    The simple card is great! It’s my alternative online checking. Easy to use and they have direct deposit and deposit check a through app. Need an external account in order to load any money on it.

  23. Good luck with American Express Serve if you’re having problems with ChexSystems. Serve uses Certegy, an equally crappy and opaque check-approving company, for their mobile app deposit system. I haven’t been able to get any check deposited — including payroll checks drawn on major banks — for months. Meaning I have to pay exorbitant counter fees to have them cashed, then burn gas driving somewhere to wait in line to load the card at a store. Neither Serve nor Certegy will offer any explanation for this humiliation.

    How GETTING MY OWN MONEY relates in any way to my non-existent check-writing history, or to check-writing statistics in my area, is beyond me.

  24. My now husband cannot open a checking out ANYWHERE! We requested a report from CheckSystems and there is nothing on there. We went to Bank of America and it turns out his ex girlfriend back in 2009 opened an account and listed him as an authorized user. Well she made “fraud” transactions according to what the banker said and now he can never open an account with Bank of America. He opened an account with Chase and a week later they closed his account. We’ve been paying off stuff on his credit report because the ex also ran up his credit and him being so trusting and lazy if you ask me never bothered to check what she was doing with his info. Any suggestions?

  25. Great post Abby. I only have two bank accounts, a chequing and a savings – with the same institution and I’ve had them for a while. I have thought about opening more accounts but what’s the point?

    As a financial planner I have declined bank account applications for clients and it’s surprising to know how many people don’t even know that banks can decline an account opening. I always offer alternatives, such as checking their credit bureau to make sure that all info is reported correctly and working on making their payments on time to improve their credit history. If a client at my bank is declined they can reapply in 3 to 6 months.

    • So i had a bank account two years ago and i over drew it by two hundred dollars. I started doing payments to fjx the issue but then moved and was unemployed so i couldnt make payments. Well last i had heard was that they closed my account indefinitely. But i really need to get a bank account opened. If i were to go to a entirely different bank would i be able to open a bank account through them or would i be denied?

  26. Steve Sager

    You really have to dig into the fee schedules of “second chance” checking accounts. You will be paying extra for a second chance. A nice feature with some second chance checking accounts is the ability to upgrade to a regular account after a certain period of trouble free banking.

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