Best Banks for Bad Credit – Banking Access for All
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Having a bank account is the foundation for a solid approach to your personal finances. However, your options may be limited when finding a bank account if you have poor or bad credit. While you might associate your bad credit score with your credit report or a new credit card, a credit check may come into play when opening a new checking or savings account.
Just because you have poor credit doesn’t mean you should be denied a bank account. With standard checking accounts and savings accounts, you can build a personal finance roadmap that allows you to improve your credit and Fico Scores, not to mention having paychecks deposited immediately for quick access and the ability to make on-time payments to creditors. From in-person options to online banking solutions, here are our picks of the best banks, all members FDIC, for those with bad credit, including those that won't penalize you with extra fees.
In this article
Overview of the best banks for bad credit table
Bank | Best for |
Axos | Online-only consumers who want checking and savings |
PNC/BBVA | Reliability |
Bank of America | Avoiding overdrafts |
Chime | Mobile-first banking |
Radius | User-friendly experience |
Fifth Third Bank | No-frills banking |
Better banking is here.
- No account fees
- Earn up to 4.20% APY
- Up to 2-day-early-paycheck
- No-fee Overdraft Coverage.
- Do it all in one app.
- Up to $2M of additional FDIC insurance through a network of participating banks.
Best banks for bad credit
Axos
Launched in 2000, Axos has made a name for itself as a fully online banking solution. While it’s true that there are a few brick-and-mortar locations in the United States, most consumers who come to Axos choose it because of its robust online options.
One major advantage of Axos is that they offer a second chance bank account in the form of a second chance checking account. A second chance bank account allows holders to open an account with certain aspects of their ChexSystems, banking history, and credit reports overlooked or ignored. This can be incredibly helpful for consumers looking to turn over a new leaf.
In addition to offering second-chance checking accounts, Axos allows consumers to open a second-chance savings account. Other perks include a mobile banking experience via Axos’ mobile app, which can help you find and access free ATMs near you.
There's no monthly maintenance fee with any of its three checking accounts, and Essential Checking also comes with overdraft protection.
Read a full review on Axos Bank.
PNC/BBVA
Highly regarded by many, BBVA (short for Banco Bilbao Vizcaya Argentaria), which PNC now owns, is one of the largest banks in the world. That makes it a secure and reputable place to open your bank accounts regardless of whether you have a low or good credit score. But because PNC acquired the bank, all existing accounts transitioned to the new owner.
A PNC checking account doesn't have an initial deposit requirement. On top of that, you'll have to pay at least $5 in monthly maintenance fee, which can be waived if you meet certain conditions, such as maintaining $300 as the average monthly balance in the account. The account also comes with overdraft protection. But the best part of PNC's vast ATM network is that you get access to over 60,000 fee-free ATMs nationwide.
Bank of America
Bank of America is an excellent choice if you’re worried about overdrafts and want to bank with a big name. Bank of America offers consumers with bad credit a SafeBalance banking account with a few different features that allow you to bank with a little more peace of mind.
For starters, the SafeBalance account from Bank of America has a simple application process where your credit history doesn’t play an essential role in approval. It also automatically protects you from overdraft fees by only letting qualifying purchases that don’t exceed your account balance go through.
Another major perk of banking with a financial institution as large as Bank of America is its extensive network of ATMs without transaction fees. Keep in mind that if you withdraw from an out-of-network ATM, you will be charged $2.50. It’s also worth noting that unlike some of Bank of America’s other financial products and accounts, you won’t be able to write physical checks with a SafeBalance account.
Regarding fees, you’ll need a minimum starting balance of $25 to open your account. Additionally, you can expect to pay $4.95 a month in service fees when banking with Bank of America, but this fee is waived if you're under the age of 18 or a student under age 25
Read a full review on Bank of America.
Chime
Chime is a mobile-first bank for the mobile generation. This can make it incredibly appealing to folks who want to access their checking or savings account information on the go. That you can bank with Chime without worrying about how the three major credit bureaus score you is just another perk.
Chime has garnered many reviews for its app, illustrating its ease of use and robust features appeal to many. For example, in addition to waiving a ChexSystem review as part of a new account’s opening, you won’t have to worry about a minimum balance to open or maintain your account.
That’s just where the savings begin, too. Unlike other banks on this list, Chime’s online banking charges $0 in monthly fees. If you withdraw from an out-of-network ATM, you will pay a $2.50 service charge. Still, with the ability to transfer money via the mobile app—and have your paycheck deposited via direct deposit, that should be less of a concern for most people.
While some consumers may be wary of online-only banking options and prefer to open accounts at local credit unions or other large chains with a national banking presence, for the younger crowd looking for a low-cost option, it’s hard to beat Chime.
Read a full review on Chime.
LendingClub Bank
Another popular online banking option is the one offered by LendingClub. Known for its user-friendly tools and simple approach to banking, it offers a cashback checking account where you earn 1.00% cash back when you use your debit card for qualified purchases.
The account has a $25 minimum opening deposit requirement, but you don't have to worry about monthly maintenance, incoming wire transfers, overdrafts or ATM fees. The best part? You can earn interest of 0.10% APY if your account has a minimum balance of $2,500. And if you've set up direct deposit, you can get your paycheck up to two days early.
Fifth Third Bank
Fifth Third Bank is a great option if you want to save money on your banking solution and don’t need too many features or services. You’ll trade minimal fees for smaller services through their Fifth Third Express account.
When opening a Fifth Third Express account, you won’t have to worry about a minimum deposit or credit check. In turn, you’ll have access to mobile banking and deposits and the ability to deposit cash at local branches.
You should be aware of some trade-offs associated with a Fifth Third Express account. For example, you won’t be able to deposit or cash checks at ATMs, even if they’re in a network. You can still withdraw cash, however.
Even though some features are sacrificed when you open a Fifth Third Express account, you can’t argue that there’s value in being a low-cost option. You won’t be charged monthly or overdraft fees with a Fifth Third Express account. Depending on your priorities, this might make it worth banking with them. Plus, you'll get access to over 50,000 partner ATMs
Better banking is here.
- No account fees
- Earn up to 4.20% APY
- Up to 2-day-early-paycheck
- No-fee Overdraft Coverage.
- Do it all in one app.
- Up to $2M of additional FDIC insurance through a network of participating banks.
Best banks for bad credit summary table
Bank | Minimum to open | Monthly fees |
Axos | $50 | $0 |
BBVA/PNC | $0 | $5 |
Bank of America | $25 | $4.95 |
Chime | $0 | $0 |
LendingClub Bank | $25 | $0 |
Fifth Third Bank | $0 | $0 |
FAQs
Can you graduate from a second chance bank account?
Yes. Some of the accounts on this list automatically offer you the chance to switch to their traditional bank accounts after you’ve banked with them for a year. Once you repair your credit, you can easily switch from a second chance bank account to a more fully-featured option.
How can selecting the right banking institution help you boost your credit score?
Improving your credit score often involves getting out of debt and improving your credit utilization. These tasks rely a lot on leveraging all of the extra money you have to pay down your debt. If you’re saving money on monthly fees and overdrafts, you’re more likely to be able to put that money towards tackling your debt.
Do all banks look at credit scores when determining eligibility?
No. As you can see from this list, there are a lot of financial institutions willing to overlook certain aspects of your credit report or ChexSystem review to help consumers get on their feet financially.
Pros and cons of banks for bad credit
Pros
- Can help you build your credit. If you’re looking to improve your credit score, having a good bank account can help you avoid overdrafts and other fees that may have you reaching for your credit card.
- Builds a better financial foundation. Having a good bank account that meets your needs (rather than whatever bank your parents signed you up for as a kid) can help you turn over a new financial leaf.
- Offers the ability to graduate to more feature-rich accounts. Even though some second chance accounts have fewer features, many banks allow you to upgrade to more “serious” accounts after a year.
Cons
- Some accounts have limited features. If you want all of the best banking features like $0 fees or cashback savings with your debit card, you may have to make sacrifices with a second chance checking or savings account.
- Some may charge annual fees. Until you’ve graduated to a more fully-featured account, you may be paying a nominal fee for your bank account each month.
- You might have to choose between proximity or features. Some of the best bank accounts on this list are mostly online, so you might have to choose between a bank with brick-and-mortar locations near you or online options.
Why you should (or shouldn’t) use these banks
If you have poor credit, switching to one of the above bank accounts could be the financial move you need to make to turn over a new leaf. If you’ve seen your credit score drop due to unsecured credit lines with high-interest rates, personal loans, or payday loans, one of the banks listed here could help you rein in your personal finances and get on a path to success. While you may sacrifice certain features or services to open an account or pay certain fees, there are often valuable trade-offs to consider.
On the other hand, if you’re happy with your banking and have relatively good credit, it’s probably not worth looking into second-chance checking accounts or second-chance savings accounts. After outlining your priorities, compare your options to ensure you get a bank with the day-to-day services, fees, and features you rely on.
Better banking is here.
- No account fees
- Earn up to 4.20% APY
- Up to 2-day-early-paycheck
- No-fee Overdraft Coverage.
- Do it all in one app.
- Up to $2M of additional FDIC insurance through a network of participating banks.
The bottom line
Many people focus on increasing their income, reducing spending, or taking out new loans or balance transfer cards to try and improve their credit. While these strategies are undoubtedly worthwhile, creating a solid foundation for your personal finances with the right bank account can work wonders for you.
If you have bad credit, switching to a bank account specifically designed for consumers like you can help. Whether it’s access to budgeting tools, $0 fees, or not requiring a credit check, the accounts on this list can boost and help you improve your credit. Plus, with mobile apps and big-name banks on this list, you won’t need to worry about reliability and security.
One thing to recognize about many of the accounts on this list is that they don’t generally come at a significant cost to you. While some have monthly fees, and others may pare down features and services, all the banks on this list are still relatively robust. Ultimately, as long as you’re weighing the pros and cons of each financial institution, you’re sure to make a decision that helps you improve your financial standing.
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Writer
Brent Ervin-Eickhoff is a Chicago-based writer, stage director, and filmmaker with a background in digital marketing and content creation. In addition to Joy Wallet, Brent has written for Complex, Volkswagen, HowlRound, Picture this Post, and Third Coast Review, among others. He currently serves as the Associate Director of Marketing for Content Creation at Court Theatre at the University of Chicago. Brent graduated from Ball State University with Academic Honors in Writing.
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