Banks That Don’t Use — or Will Look Past — ChexSystems

If you are denied a new bank account, one possible explanation is that the financial institution used ChexSystems to check your banking history and found a concern, like an unpaid overdraft fee. Though there are steps you can take to clear up your ChexSystems record, you may want to consider opening an account with a bank that doesn’t rely on ChexSystems.

The following banks, credit unions and financial technology companies overlook ChexSystems records when screening applicants. Though some may still take a look at your ChexSystems history, these institutions and/or accounts are more likely to look past imperfections in your banking history or lower the barrier to access an account.

*Some big banks use Early Warning Services (EWS) as an alternative to ChexSystems. EWS is designed to help detect and prevent fraud by providing deposit account data. It’s a service that’s co-owned by several large banks, including Chase Bank and Wells Fargo.

If you’re restricted by a ChexSystems record, you might look into getting a second chance checking account, especially if you’re looking for an account with a local bank or credit union.

These accounts are designed to help people get back on track with their banking after landing in ChexSystems. They often come with monthly fees that can’t be waived and usually don’t allow overdrafts, but they provide standard banking services. These accounts can be a better option than using prepaid debit cards or third party check cashing services, which typically don’t offer as many (if any) banking services and may charge transaction fees.

Overdraft fees can be an expensive pitfall, and if you’ve been reported to ChexSystems for not paying an overdraft fee in the past, you probably already know how costly they can be.

When you get a new account, you may want to take some additional steps to avoid overdrafting in the future. One way to do this is might be by opting out of overdraft coverage altogether: Your bank will simply decline any transactions that would bring your account into a negative balance.

You can also set up overdraft protection transfers, which links another account, like your savings account, to cover an overdraft. Some banks and credit unions also allow overdraft lines of credit, which will cover your overdrafted balance but charge interest, similar to a credit card.

There are also some institutions that have created flexible overdraft policies that include buffers, grace periods, or cash advances that allow you to overdraft up to a certain amount or for a limited amount of time.