Chime is an online second chance bank. It is far less strict to sign up than with traditional banks. It is completely free to have a checking account and savings account (plus, earn $50 for signing up!). And if you have bad credit, don’t worry about it. Chances are, you can still sign up! It is a second chance bank, after all.
So let’s talk about the interesting stuff, the good, and the bad.
TIP: I’d advice having more than one bank account for various reasons. “Don’t put all your eggs in one basket”. If one account gets hacked, you won’t lose all your hard-earned money!
Chime is free online banking because…
Chime is free because they make money through transactions made with the Visa debit card. It’s honestly that simple. It’s similar to how we get points or credits from using credit cards. But instead, Chime keeps these credits.
Free debit card and perks
A checking account without a debit card is unacceptable. So, Chime also provides us with a Visa card. Free of charge. They send it immediately after we open an account and input our address details. No extra steps required.
Easy to use
Have you guys noticed how your typical bank has a bunch of options all over the place on their website?
Early pay with direct deposits
You’ll need an employer that provides direct deposits, of course. Direct deposits are up to 2 days faster than getting paid by check. It’s cheaper, faster, and more convenient for companies to provide them.
Automatic savings with their Savings Account
Chime has a pretty nifty savings feature. Whenever we spend, it’ll round up to the nearest dollar. Those extra cents used (to round up) are then sent to the savings account on its own.
For example, if we spend $4.55 at a store, Chime will take $5 from our account instead. The extra $0.45 that it took will automatically go to the savings account.
It’s not much but I find it pretty nifty. It’s similar to how we use piggy banks when we have some change left in our pockets.
But if that doesn’t tickle your fancy, no problem. It’s a feature we must activate. You can simply ignore it.
I find Facebook notifications very annoying. But when it comes to my money, I always want to know what’s up!
The Chime app notifies us instantly every time we spend or get more money in. For example, on my Android phone, I was notified when my micro deposits from PayPal had arrived. I was eager to know so I could transfer funds from PayPal.
This second chance bank also notifies us every morning. Of course, both notification features can be turned off (individually).
No nonsense fees
The best thing about Chime is that it’s free and with no hidden fees:
Minimum balance or direct deposits?
We don’t need a minimum balance. In a typical bank, we need a few hundred to over a thousand dollars a month. Not on Chime.
We don’t need direct deposit of so and so a month either.
No dirty hidden fees
Has your bank charged you over something strange? Such as a maintenance fee or some other nonsense?
I remember having $10 on my savings account in my local bank. I had to open said account in order to sign up for their checking account. But months later, it was down to $1. What happened to the $9? I have no idea.
Chime isn’t known to do such things. In fact, the app always notifies us of transaction updates. No matter how small.
No overdraft fees
If we spend more than what we have, Chime will simply lend us the money temporarily until we can pay it off. No fee.
But going overdraft is an optional service. It’s only available to those that qualify for their SpotMe program. This program requires us to have a direct deposit of $500 or more a month.
SpotMe starts off with an overdraft limit of $20, but can go up as $100 depending on our account history.
ATMs in their network are free, too
As Chime states on their blog, “Accessing your own money shouldn’t cost you money.”
They offer well over 38,000 fee-free ATMs in the US. A convenient way to find out where these ATMs reside, is through the mobile app or website.
These must be MoneyPass and Visa Plus machines, as it states on their image below.
But what about foreign transaction fees?
This second chance bank doesn’t charge a single penny for transactions. However, out-of-network ATMs do have their own fees, so we must be aware of those costs.
Yup, that’s right. Free checks. However, they don’t send us a checkbook. The way it works, we use the app or website to fill out a small form to “write a check”. Chime then sends this physical check from their location to a business or person on our behalf.
It’s pretty convenient as we don’t have to deal with writing checks. Some of don’t need them or only need a few. I feel it’s better than dealing with money orders, too.
Second chance bank with a $50 sign up bonus!
We must deposit at least $200 through direct deposit. It must be within 2 weeks after creating an account.
However, I personally don’t have direct deposit! I am self-employed. BUT! I transferred $200 from PayPal to my new Chime account, and it worked!
Another suggestion would be by using an app called Cash App. We can deposit money to it to then transfer it to a Chime account. It has worked for other people.
NOTICE: Do note that Chime may change its offers at any time.
Drawbacks of Chime banking
There’s no such thing as something being perfect. It’s only natural. So here are the drawbacks of having an account in this second chance bank that I’ve found so far:
No physical branches
This should be obvious. There’s no way we can just walk into a Chime building to create an account or seek help face-to-face. This is not a problem for me whatsoever, but it probably is for some people.
Cash deposits through Green Dot for a fee
Because of the lack of branches, it makes sense that depositing cash will be inconvenient. So we have to rely on third party services to do the process for us.
My advice is to keep a traditional bank account if you’re able to.
Awful interest rates
It doesn’t make much sense to open a savings account in this second chance bank if you’re looking to earn from interests. As of right now, the APY interest is a meager 0.06%.
According to a quick research, it used to be 1.60% one time. Other times it was 0.10%. It may rise again, I’m sure. But the same goes with lowering it again and again.
Unless you like the automatic savings feature, then I wouldn’t recommend Chime.
Lack of joint accounts
Not a problem to many, such as myself. But for those that need to create a joint account for business purposes can’t.
Out-of-network ATM fees charge $2.50 or more
The website doesn’t immediately make it clear that they do charge an out-of-network fee. But they do make it clear where we should locate their ATMs for free transfers. So I can’t say this is a hidden fee.
Also note that the $2.50 is from Chime. So that out-of-network ATM itself may even have its own fee on top.
It’s definitely unwise not to use their ATMs with their ATM locator.
If you’re interested in having a Chime bank account and earn a $50 bonus, you may sign up here. We both earn the bonus, and it’ll help fund the site!