Challenger bank Chime has reached 5 million customers in the U.S. The San Francisco-based startup is creating an FDIC-insured mobile bank without any physical branch. The company also promises fewer fees. Show
Back in March, Chime said it had 3 million customers when it announced its $200 million Series D round. So that’s 2 million additional customers in roughly 5 months. Chime says that it is the fastest growing challenger bank in the world. In other words, the company is throwing shade at European challenger banks, such as Monzo and N26, that have been doing really well too. N26 just entered the U.S. market. The company is also rolling out a new feature that it has been testing for a while. Chime SpotMe is an alternative to bank overdrafts. It is specifically targeted at people who deposit their paycheck into their Chime account but also live paycheck to paycheck. Chime users who receive payroll direct deposit of at least $500 per month can sign up to Chime SpotMe. After that, you can keep spending with your debit card even if your balance goes below $0. Your overdraft limit will depend on multiple factors, but some users will be able to overdraw their account by $100. When you next paycheck arrives, your negative balance is paid back and you don’t pay any overdraft fee. The company says that you also can optionally leave a tip to help other Chime users make ends meet. Editorial Note: We earn a commission from partner links on Forbes Advisor. Commissions do not affect our editors' opinions or evaluations. Many financial institutions offer a full slate of account options with various bells and whistles, making it hard to determine the best fit for your needs. Instead of overloading you with choices, Chime® keeps it simple with one checking account, savings account and secured credit card, all tied up within an attractive mobile app. Chime is a financial technology company, not a bank. Banking services provided by The Bancorp Bank, N.A. or Stride Bank, N.A., Members FDIC. What we’re watching: As reported by ProPublica in July 2021, there have been numerous complaints from Chime consumers regarding sudden account closures. In more than 900 complaints filed with the Consumer Financial Protection Bureau since April 15, 2020, customers have reported being denied access to funds in Chime accounts. A Chime statement said that these issues were caused by Chime’s heightened anti-fraud efforts during the Covid-19 pandemic. Wondering if Chime is right for you? This Chime review offers a closer look at the products and services on offer. Account details and annual percentage yields (APYs) are accurate as of Oct. 25, 2022. Account BasicsChime offers two bank account options to help you manage your money. Here’s a rundown of each account’s features, benefits and pricing. Chime® Checking AccountThe Chime® Checking Account charges $0 in monthly maintenance fees. And there are no minimum balance requirements for this account. Minimum Deposit Requirement $0 Here are some of the highlights of the Chime Checking Account:
The Chime® Checking Account is fee-friendly. For example, when you enroll in Chime’s SpotMe service, you can overdraw your account by up to $200 on debit card purchases without a fee. A single deposit of $200 or more in qualifying direct deposits is required each month to be eligible for this feature. Chime can increase your SpotMe allowance to up to $200 at its discretion based on your account history, direct deposit amounts and frequency, spending activity and other factors. There’s no credit check to open an account through Chime and receive a Chime debit card. Your debit card can be used anywhere Visa is accepted. Read More: Best Checking Accounts Of 2023 Chime High-Yield Savings AccountChime’s Savings Account offers an annual percentage yield (APY) of 2.00%. That’s a fairly competitive rate compared to high-yield savings accounts from top online banks. 1 Chime High-Yield Savings Account Minimum Deposit Requirement $0 1 Chime High-Yield Savings Account ¹The Annual Percentage Yield (“APY”) for the Chime Savings Account is variable and may change at any time. The disclosed APY is effective as of October 25, 2022. No minimum balance required. Must have $0.01 in savings to earn interest. Here are the main highlights of the Chime High-Yield Savings Account:
You will need a Chime Checking Account to open a Chime Savings Account. Once you have your accounts set up, you can use Chime’s Round Ups feature to save automatically. Whenever you use your Chime Visa® Debit Card*, Chime rounds the transaction up to the nearest dollar and transfers the difference to your savings account***. For example, let’s say you spend $25.50 at the grocery store. You’ll pay the store for that amount from your debit card, and Chime will move 50 cents from your spending account to your savings account. Chime also offers the Save When I Get Paid**** feature that allows you to set up a recurring transfer of 10% of your direct deposit paycheck of $500 or more from your checking account to your savings account each time you get paid. Read More: Best High-Yield Savings Accounts Of 2023 Other Accounts and ServicesChime offers the Secured Chime Credit Builder Visa® Credit Card available without a credit check. This card is designed for people who are trying to build credit. Here’s an overview of how the card works:
Chime reports your payments to all three major credit bureaus. The Secured Chime Credit Builder Visa Credit Card charges no interest, no annual fee and no upfront security deposit. There’s no pre-set spending or credit limit, so you can decide how much credit to extend to yourself. You’ll need Chime checking and qualifying direct deposits of $200 or more to apply for the Secured Chime Credit Builder Visa Credit Card.^^ Read More: Best Banks Of 2023 Access on the GoChime is designed to be used primarily through its mobile app and offers plenty of features to make mobile banking convenient. Chime is known for its mobile app, rated 4.8 out of 5 stars on the App Store and 4.7 out of 5 stars on Google Play. The Chime app sends daily account balance notifications and transaction alerts when you make a purchase. You can disable transactions from the Chime app, saving yourself a customer service call if you misplace your card. You can also choose to disable international transactions via the app. Your Chime debit card works anywhere Visa is accepted, and you can add it to your Apple Pay or Google Pay mobile wallet. You also have access to more than 60,000 MoneyPass, Allpoint and Visa Plus Alliance ATMs˜. You can check the Chime app to avoid out-of-network ATM fees. If you want to deposit a check to your Chime Checking Account, you can do so via mobile deposit on the Chime app.^^^ If you lose your Chime debit card, you can disable transactions within the Chime app. There’s no charge for replacement debit cards, which can be requested in the Chime app.
Chime FeesChime does not load its customers down with fees like you might find at a traditional brick-and-mortar bank. For example, there are no:
There is one fee to be aware of, however. Chime assesses a $2.50 ATM withdrawal fee when you withdraw cash at an out-of-network machine. The ATM operator may also charge a third-party fee. How Chime Stacks UpIf you’re looking for a full suite of banking services, Chime may not be the best fit for you. But if you’re just getting started on your financial journey and want a user-friendly set of financial tools, facilitated by a multipurpose app, Chime covers the basics well. Its automated savings tools are particularly attractive for customers who want to boost their emergency fund or save for another goal. Here’s how Chime compares to two other top online banking options. Chime vs. AllyAlly Bank offers numerous banking products and services, including:
Ally doesn’t offer credit cards, but you can apply for personal loans, auto loans and mortgage loans. Ally accounts are FDIC-insured and there are no monthly maintenance fees or minimum balance requirements. Chime and Ally offer comparable interest rates. The Ally Bank Interest Checking account pays 0.10% annual percentage yield (APY) on checking accounts with less than a $15,000 minimum daily balance, and 0.25% APY for accounts with minimum daily balances of $15,000 or more and the Ally Bank Online Savings Account pays an APY of up to 3.30%. Your balance will determine if you earn the highest APY. Ally reimburses up to $10 in foreign ATM fees per statement cycle. Chime vs. VaroVaro offers a checking account, called the Varo Bank Account, and a Varo Savings Account. The accounts have no monthly or overdraft fees. You can manage your accounts online or through the Varo Bank mobile app. Varo’s ATM network includes 55,000+ fee-free Allpoint locations. The bank’s Varo Advance feature allows you to get up to a $100 advance against your paychecks. Varo Believe offers an opportunity to build credit with no security deposit, no fees and no interest. A Note on Chime ProductsChime is a financial technology company, not a bank. Banking services and debit card provided by The Bancorp Bank or Stride Bank, N.A.; Members FDIC. Credit Builder card issued by Stride Bank, N.A. **Early access to direct deposit funds depends on the timing of the submission of the payment file from the payer. We generally make these funds available on the day the payment file is received, which may be up to 2 days earlier than the scheduled payment date. ^Chime SpotMe is an optional, no fee service that requires a single deposit of $200 or more in qualifying direct deposits to the Chime Checking Account each month. All qualifying members will be allowed to overdraw their account up to $20 on debit card purchases and cash withdrawals initially, but may be later eligible for a higher limit of up to $200 or more based on member’s Chime Account history, direct deposit frequency and amount, spending activity and other risk-based factors. Your limit will be displayed to you within the Chime mobile app. You will receive notice of any changes to your limit. Your limit may change at any time, at Chime’s discretion. Although there are no overdraft fees, there may be out-of-network or third party fees associated with ATM transactions. SpotMe won’t cover non-debit card transactions, including ACH transfers, Pay Anyone transfers, or Chime Checkbook transactions. See Terms and Conditions. ***Round Ups automatically round up debit card purchases to the nearest dollar and transfer the round up from your Chime Checking Account to your savings account. ****Save When I Get Paid automatically transfers 10% of your direct deposits of $500 or more from your Checking Account into your savings account. ^^To apply for Credit Builder, you must have received a single qualifying direct deposit of $200 or more to your Checking Account. The qualifying direct deposit must be from your employer, payroll provider, gig economy payer, or benefits payer by Automated Clearing House (ACH) deposit OR Original Credit Transaction (OCT). Bank ACH transfers, Pay Anyone transfers, verification or trial deposits from financial institutions, peer to peer transfers from services such as PayPal, Cash App, or Venmo, mobile check deposits, cash loads or deposits, one-time direct deposits, such as tax refunds and other similar transactions, and any deposit to which Chime deems to not be a qualifying direct deposit are not qualifying direct deposits. Money added to Credit Builder will be held in a secured account as collateral for your Credit Builder Visa card, which means you can spend up to this amount on your card. This is money you can use to pay off your charges at the end of every month. ˜Out-of-network ATM withdrawal fees may apply except at MoneyPass ATMs in a 7-Eleven, or any Allpoint or Visa Plus Alliance ATM. ^^^Mobile Check Deposit eligibility is determined by Chime in its sole discretion and may be granted based on various factors including, but not limited to, a member’s direct deposit enrollment status. Learn More About the Chime® Checking Account Find Out How to Get Started Frequently Asked Questions (FAQs)All Chime accounts are FDIC insured up to the standard maximum of $250,000 per depositor, for each ownership category, in the event of a bank failure, through its partner banks, Stride Bank, N.A. (FDIC No. 4091) or The Bancorp Bank (FDIC No. 35444). What happens if someone steals my Chime debit card or makes unauthorized purchases?Visa’s Zero Liability Policy protects Chime debit cards, so you won’t be responsible for purchases if your card information is stolen. What is required to open a Chime account?You need to provide your Social Security number, home address and be a U.S. citizen or resident. You must be at least 18 years old. Why can't I open a Chime account?If you’re unable to open a Chime account online, it may be because Chime is unable to verify your personal information. This may be an issue with Chime’s information verification system, rather than your eligibility for an account. Can I overdraft on my Chime credit builder card?Can I overdraft my Chime Credit Builder card? You cannot overdraft with your Chime Credit Builder card. However, to qualify for Credit Builder, you need a Chime Checking Account with qualifying direct deposits – the same criteria to be eligible for fee-free overdraft with SpotMe® when you use your Chime debit card.
How much can you overdraft a Chime credit card?How much can I overdraft with SpotMe? Your Chime SpotMe limit starts at $20 and may go up to $200 depending on your account activity, history, and other risk factors.
Can you go over on your Chime credit card?The amount you transfer becomes your credit limit which the card won't allow you to go over. You can add more money at any time. In a way, the Chime Credit Builder works like a prepaid card that reports your activity to credit bureaus.
Can you overdraft a credit card?In most cases, it isn't possible to overdraft a credit card. If you opt in to over-the-limit charges, it may be possible to exceed your credit card's limit. However, “overdraft” usually refers to overdrawing a bank account, not a credit card. It's more likely that your purchase will be denied rather than overdrawn.
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Can i overdraft my chime credit card
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