Chime Review: A Fee-Free Banking Option (2023 Update)

Bank fees can be frustrating. Luckily, online banking platforms offer checking and savings accounts that can help you avoid unwanted fees.

Online-only institutions also typically offer free ATM access, fee-free overdrafts, and other features that make it easy to manage your money.

If you want a banking option that is light on fees without sacrificing features, this Chime^® review covers why they are a great option for your needs.

What Is Chime?

Chime isn’t a traditional bank with physical branches¹. Instead, it is a financial software company operating as a neobank with FDIC-insured accounts.

A neobank has fewer expenses than a regular bank, allowing you to enjoy more benefits at a lower cost.

The financial institution operates entirely online and has the backing of The Bancorp Bank, N.A. and Stride Bank, N.A. These two companies perform banking services for numerous banks nationwide.

Your account has up to $250,000 in FDIC Insurance. This is the same coverage amount as traditional banks.

Chime Accounts

The financial app offers three main account types, including a checking, savings, and Secured Chime Credit Builder Visa^® Credit Card.

Chime® Checking Account

When you join Chime, you automatically get a Checking Account with no monthly fees or balance requirements.

Some of the features include:

• A Chime Visa^® Debit Card²
• Direct deposit
• Online bill pay
• Sending money instantly to anyone^3,4
• 60,000+ fee-free ATMs⁵

Even though this account is for an online-only service, the institution offers checks via their Chime Checkbook feature. You don’t physically write a check, but they send one for you if requested.

This feature is free of charge, and there is no limit on the number of checks you can send each month. They also offer mobile deposits.⁶

Unfortunately, this account doesn’t earn interest or offer a joint account option. This is similar to Spruce from H&R Block. Read our Spruce Bank review to learn more.

Savings Account

This app-based service offers a high yield savings account that earns a competitive interest rate. Chime Checking Account is required to be eligible.

As of November 17th, 2022, your entire balance gets 2.00 percent APY⁷, which is ten times the national average⁸.

Similar to other high-yield savings accounts with the best online savings account rates, current federal regulations limit you to a maximum of six transactions per month.

Once again, there are no monthly fees or minimum balance requirements.⁹

There are three ways to fund this account, including:

• One-time transfers from your Checking Account
• Chime debit card spending Round Ups¹⁰
• Transferring ten percent of direct deposits of $500 or more¹¹

This account is optional but easy to open. Since it earns a high yield and is FDIC-insured, Chime can be the only online institution you need for saving money and making purchases.

Secured Chime Credit Builder Visa^® Credit Card

Chime also offers a credit card. You can request a free Secured Chime Credit Builder Visa Credit Card¹² to build credit.

Each monthly payment reports to the three credit bureaus, allowing you to improve your credit score.¹³

Unlike most credit cards, this product doesn’t:

• Charge an annual fee
• Have purchase APR interest charges¹⁴
• Require a minimum security deposit¹⁵
• Perform a hard credit check during the application process

To qualify for this card, you need at least $200 in monthly direct deposits.

While you won’t have to make a security deposit to open an account, your card spending limit is the amount of money you transfer to your Credit Builder account.

The Available to Spend money management feature displays how much of your card balance remains for future purchases.

Features

Chime has an impressive list of benefits that appeal to most customers.

SpotMe^®

The SpotMe¹⁶ feature allows you to make debit card purchases even if it overdraws your account. This financial tech company won’t charge you any overdraft fees when you enroll in this program.

To qualify for this feature, you must receive at least $200 per month in direct deposits. Qualifying deposits include employer paychecks and government benefits.

Your initial overdraft limit is $20. This means that you can’t go over more than $20.

After your account history and usage grows, you may qualify for up to $200 in benefits.

If you overdraft, Chime deducts the negative balance from your next deposit, and you won’t pay any fees. However, you can pay an optional tip when you use this service.

Most banks require you to open a separate line of credit account that assesses fees to have a similar feature.

This feature is similar to apps like Dave that offer you an advance on your paycheck.

Early Access to Paychecks

Depending on your employer, you may receive your direct deposits up to two days earlier than the scheduled deposit date.¹⁷

How soon you receive your check depends on when the party submits payment.

This feature is similar to how paycheck advance apps work. Be sparing on taking advantage as it has the potential to cause some problems with your finances.

Round Ups

One of the best tips to save money is to save in small amounts whenever possible. The Round Ups feature can increase each debit card purchase to the next dollar and transfer the extra amount to your savings account.

For example, if you buy gas and your total is $33.47, Chime will automatically round up to the nearest dollar ($34). The change, equaling $0.53, is then transferred to your savings account.

Keep in mind that if you choose this feature, it will apply to every purchase you make.

Additionally, with Save When You Get Paid, you can ask Chime to automatically save up to ten percent of your direct deposit paycheck by putting it into your savings account.

Split the Bill

You can send money to another Chime online account or to friends at another bank free of charge. This feature makes it easy to split purchases.

The mobile app also gives you the option to request money from friends who also use the financial app.

Your friend will receive a text message for the request, and you instantly receive the funds when they send payment.

Bill Pay

Mobile banking is easy when you have free bill pay.

You can pay bills by providing merchants and utility companies with your debit card or checking account details.

What makes Chime different from some of its competition is its ability to send checks to companies that won’t accept debit payments or bank transfers.

While you can’t write paper checks, this bank will mail unlimited checks on your behalf if the person can wait several days to receive payment.

Fee-free ATM Network

Chime has access to over 60,000 ATMs offering fee-free ATM withdrawals.

The fee-free ATM network includes these partners:

• Allpoint
• Visa Plus Alliance
• Moneypass ATMs in 7-Eleven locations only

It’s also possible to withdraw money at cash back locations like Walmart, CVS, and Target. However, fees may apply.

You can find the fee-free ATMs in the mobile app when you need cash. The daily withdrawal limit is $500.

If you do use an out-of-network ATM, the fee is only $2.50. This is cheaper than most ATM fees.

In addition to withdrawing cash, you can make cash deposits at GreenDot kiosks at over 90,000 stores. A transaction fee will apply.

What Fees Does Chime Charge?

Chime has fee-free online accounts for most customers.

Some of the fees you may encounter include:

• Out-of-network ATM withdrawals: $2.50 per transaction
• Cash withdrawals at stores: Varies (potentially free)
• GreenDot cash deposits: Varies
• Load an external debit card: Three percent

You won’t pay these fees with any Chime online account:

• Account service fee
• ACH transfer fee
• Card replacement fee
• Foreign transaction fee
• Overdraft fee
• Sending money to friends
• Bill payments

If you don’t mind using an online account, Chime is a good solution to avoid unnecessary fees.

How Does Chime Make Money?

There are several ways the platform makes money so it can continue to offer fee-free accounts.

Some of the income streams include:

• Transaction fees from Visa card purchases
• Out-of-market ATMs
• Tips from the SpotMe feature

The debit card and credit card interchange fees are the primary way this financial app makes money.

Additionally, the app uses the fees to cover overhead expenses instead of passing on some of the fee income as cash back rewards when you make a purchase.

Pros and Cons

Here are the advantages and disadvantages of using Chime.

Pros

• No monthly fees
• FDIC-insured up to $250,000.
• Fee-free ATM withdrawals at over 60,000 ATMs
• Mobile-friendly way to send money and pay bills
• Free overdraft protection
• High-yield savings account
• Secured credit card with no annual fee
• Works as a second chance bank account as they don’t use ChexSystems

Cons

• Online only with no physical branch access
• No rewards on debit card purchases
• Cash deposits at GreenDot locations only and fees apply
• Reduced customer service by app, email, and phone only
• $2.50 transaction fee for non-network ATMs

If you don’t mind using an internet-only bank and want to avoid fees, Chime may be a good fit for your needs.

Competitors

When choosing a bank, consider your needs, including branch access, account types, fees, and rewards.

If you don’t think the service is right for you, these apps like Chime may offer better features for your money goals.

CIT Bank

CIT Bank offers free online-only checking and savings accounts. The minimum initial deposit is $100 for each account, but there is no ongoing balance requirement.

If you can start with $100, and electronically deposit at least $200 a month you can qualify for their Savings Connect account. This account pays 4.50 percent, 12x the current national average.

All deposits are FDIC insured up to the $250,000 per depositor maximum.

Some of the overlapping features include free ATM access, online bill pay, and competitive interest rates.

CIT Bank also provides a wide array of products, from money market and business accounts to lending products.

Read our CIT Bank review to learn more.

OnJuno

OnJuno offers a rewards checking account. Your first $5,000 account balance can earn interest, and debit card purchases at participating stores can earn up to five percent back.

Customers also have access to 85,000 fee-free Allpoint and MoneyPass ATMs.

When you have at least $500 in monthly direct deposits, you can upgrade to a premium account that includes additional benefits.

BBVA (Now PNC)

BBVA Compass is in the process of joining PNC Bank. You may consider this option if you need local branch access with competitive features.

If you want a full-service bank with products from mortgages to investing and credit cards, this may be a good fit for your needs.

Bottom Line

Chime is an excellent choice for people who are looking to manage their money on the go. The app is easy to use, and the institution offers a lot of helpful features.

Having online banking that is virtually fee-free sets them apart from other banks, especially if you want an online checking and savings account.

If you don’t need local branch access, this service makes it easy to manage your money and earn interest while avoiding bank fees.

How much do you pay in fees at your bank? 

¹Chime is a financial technology company, not a bank. Banking services provided by, and debit card issued by, The Bancorp Bank N.A. or Stride Bank, N.A.; Members FDIC. Credit Builder card issued by Stride Bank, N.A.

²Banking services and debit card provided by The Bancorp Bank N.A. or Stride Bank, N.A., Members FDIC, pursuant to a license from Visa U.S.A. Inc. and may be used everywhere Visa debit cards are accepted.

³Funds are automatically debited from your Checking Account and typically deposited into the recipient’s Checking Account within seconds. Pay Anyone transactions will be monitored and may be held, delayed or blocked if the transfer could result in fraud or another form of financial harm. Sometimes instant transfers can be delayed.

⁴Sometimes instant transfers can be delayed. The recipient must use a valid debit card to claim funds. Once you are approved for a Chime Checking Account, see your issuing bank’s Deposit Account Agreement for full Pay Anyone Transfers details. Please see the back of your Chime debit card for your issuing bank. See Terms and Conditions.

⁵Out-of-network ATM withdrawal fees may apply except at MoneyPass ATMs in a 7-Eleven, or any Allpoint or Visa Plus Alliance ATM.

⁶Mobile 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.

⁷The Annual Percentage Yield (“APY”) for the Chime Savings Account is variable and may change at any time. The disclosed APY is accurate as of November 17, 2022. No minimum balance required. Must have $0.01 in savings to earn interest.

⁸The average national savings account interest rate of 0.21% is determined by FDIC as of November 17, 2022 based on a simple average of rates paid (uses annual percentage yield) by all insured depository institutions and branches for which data are available. Visit National Rates and Rate Caps to learn more.

⁹There’s no fee for the Chime Savings Account. Cash withdrawal and Third-party fees may apply to Chime Checking Accounts. You must have a Chime Checking Account to open a Chime Savings Account.

¹⁰Round 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.

¹¹Save When I Get Paid automatically transfers 10% of your direct deposits of $500 or more from your Checking Account into your savings account.

¹²To 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.

¹³On-time payment history can have a positive impact on your credit score. Late payment may negatively impact your credit score. Results may vary.

¹⁴Out-of-network ATM withdrawal fees apply except at MoneyPass ATMs in a 7-Eleven location or any Allpoint or Visa Plus Alliance ATM.

¹⁵Money 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.

¹⁶Chime 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.

¹⁷Early 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.