What To Do When You Can’t Open a Bank Account


Can’t get a bank to let you open your checking account? Having a bank account is important. That’s how you are going to pay your bills and manage your finances. So, when your application to open a checking account gets rejected, you will feel stressed.


Fortunately, there are still a few options available for you.

What to do when you can’t open a bank account

Here’s what you should be doing if you can’t get a bank to give you a checking account:

Find out why

The first thing you should be doing is finding the reason your application was rejected. Your bank is required to tell you why they rejected you, according to the Fair Credit Reporting Act. Some reasons your bank rejected you are:

  • Your documents are incomplete. Banks require two forms of identification. These include your social security card, passport, National ID, birth certification, or driver’s license. Complete your documents and you could get the account.
  • You did not fulfill the minimum balance requirement. Most banks require a $100 deposit to open your checking account.
  • You have a poor credit score. Try improving your score.
  • Your application might also be rejected due to a negative ChexSystem Report. This happens when you have outstanding debts, unpaid bank fees or a history of frequent overdrafts. Your next step should be getting your ChexSystem report. Find out which bank has put you in the position and why. Talk to the bank and negotiate your position. Pay off the outstanding debts or fees, to correct the report. There’s also a chance there is a mistake in your report. Recheck the report for mistakes. And if there is one, get the bank who reported you to correct the mistake.

Improving your ChexSystem report or your credit score could take a lot of time. Meanwhile, you can also explore other options.

Second Chance Account

You could consider opening a second chance account. These are checking accounts many people go for when traditional banks refuse to open their checking account. Second chance banks don’t go through your ChexSystems report. Once you open your second chance checking account, you can start rebuilding your credit score and open a traditional checking account in a few months.

With a second chance checking account, you can avail all the features of a normal checking account such as ATM cards, online banking, money transfer, debit card, checks, and direct deposit. The difference is that a checking account might be more costly to open. They usually charge a higher bank fee or might ask for a bigger initial deposit to secure themselves.

To know more about second chance accounts, check out LetMeBank.com

Prepaid Cards

With prepaid cards, you put your funds in your account first and spend them later. You will probably spend more money on fees with a prepaid card.

A prepaid card works very similarly to a checking account. You can avail all the features of a regular checking account with this card. When getting a prepaid card, check for fees. Fees for the prepaid card used to be quite high but has gone down in the last few years. Also, check that you are getting all the features you want.

You should know that a prepaid card is not the same as a credit card. You won’t be building your credit score with this. So, don’t expect your prepaid to have any impact on your credit score.

Secured Credit Card

Another option to consider when you can’t get a bank to offer you a checking account is a secured credit card. This card work like a combination of a prepaid card and a credit card. You deposit money in your card, like a prepaid card but you let the bank keep a deposit. This deposit is used by your bank as a guarantee for defaults.

Secured credit cards help you rebuild your credit score. The main drawback of this card is the high-interest rate and the low credit limit offered to the holder. You can manage the high-interest rate by paying off the billed amount at the end of each month before interest is charged.

We don’t recommend a secured credit card if you have problems paying off your amount dues on time. This could bring down your credit score even lower.

Get in Touch with a Credit Union

Your local credit union is there to help you through financial difficulties. Most credit unions allow users to open a checking account with them under more lenient terms. You could also use them to build your credit score to help you open a checking account with a regular bank later.

Apart from this, there are also banks that don’t do background checks before opening checking accounts. Find out if there is a bank in your city that follows a similar protocol.




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