By Ben LuthiWhat Is Second Chance Banking?
Quick Answer
Second chance bank accounts provide consumers who have been denied a checking account with access to basic traditional banking services.
Second chance banking makes it possible for people who can't qualify for a traditional bank account to access basic banking services. Consumers may turn to second chance banking if they've had a history of account overdrafts, bounced checks, account closures or other events that prohibit them from opening an account at a mainstream bank.
The approval requirements for these accounts are typically less stringent compared to traditional checking accounts, but some of them can also come with some limitations. Here's what you need to know.
What Is a Second Chance Bank Account?
A second chance bank account is an account with a financial institution that either doesn't check your ChexSystems report or is willing to look past your previous missteps.
A ChexSystems report can show negative bank account actions and activities, such as an involuntary account closure and unpaid negative balances. If the financial institution deems risks based on information in your ChexSystems report, it can deny your application.
Second chance accounts give you an opportunity to access basic banking services without needing to rely on inconvenient and high-cost money services, such as check cashing and money orders.
While some key features may be missing, you can use a second chance account to rebuild your banking history and get back in the good graces of other banks and credit unions.
Pros and Cons of Second Chance Bank Accounts
Although second chance accounts offer key services for unbanked and underbanked households, there are some drawbacks to consider. Here's what you need to know.
Pros
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Easy approval: With no ChexSystems check involved in the application process, second chance accounts may be easier to obtain than traditional bank accounts.
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Access to basic banking needs: You may not get all the features of a traditional bank account, but you'll typically still get important services, such as direct deposit, a debit card and ATM access. What's more, many second chance accounts offer all of the same features you can get with a standard bank account option.
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Can help you rebuild your banking history: While second chance financial institutions typically won't review your ChexSystems report when you apply, they'll typically still report your banking activity after your account is opened. This can help you build a positive banking history and improve your odds of getting approved for a traditional bank account in the future.
Cons
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Some accounts offer limited services: Depending on which financial institution you choose, you may not have access to certain features, such as overdraft protection or check-writing privileges.
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Monthly fees: Despite offering limited services, some second chance accounts come with a monthly fee, which may or may not be waivable.
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Limited accessibility: Not all financial institutions offer second chance accounts, so you may not be able to go with your preferred financial institution.
Is a Second Chance Checking Account Right for You?
A second chance checking account can be a good fit if you're having trouble getting approved for a traditional checking account. While some of these accounts limit what you can do, others offer full banking services and little to no monthly fees.
Most important, many of these accounts can give you access to critical services, such as mobile deposits, bill pay and more. Just keep in mind that some of these financial institutions may be online only, so if you need to cash checks, check the company's physical branch footprint to determine whether it's a good fit.
Nationwide Second Chance Accounts
Many financial institutions offer second chance accounts. Below are just a handful of nationwide examples (information valid as of March 4, 2025). Refer to company websites for account details and related disclosures.
| Capital One 360 Checking Account | Monthly fee: $0 Minimum to open: $0 Minimum balance: None Overdraft fees: None |
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| Chase Secure Banking | Monthly fee: $4.95, waivable with qualifying direct deposits of $250 or more per statement period Minimum to open: $0 Minimum balance: None Overdraft fees: None |
| Chime Second Chance Banking | Monthly fee: $0 Minimum to open: $0 Minimum balance: None Overdraft fees: None |
| GTE Financial Go Further Checking | Monthly fee: $9.95; waivable if you enroll in e-statements, make $500 in aggregate deposits per month and make a combination of 15 monthly debit and/or credit card transactions Minimum to open: $5 Minimum balance: None Overdraft fees: $7 |
| LendingClub Rewards Checking | Monthly fee: $0 Minimum to open: $25 Minimum balance: None Overdraft fees: None |
| SoFi Checking | Monthly fee: $0 Minimum to open: $0 Minimum balance: None Overdraft fees: None (Overdraft coverage up to $50 for debit card purchases; available to customers with monthly direct deposits of $1,000 or more) |
| Varo Bank Account | Monthly fee: $0 Minimum to open: $0 Minimum balance: None Overdraft fees: None |
| Wells Fargo Clear Access Banking | Monthly fee: $5; waivable if the primary account owner is between ages 13 and 24, has a Wells Fargo Campus ATM Card or Campus Debit Card linked to the account or receives a qualifying monthly non-civilian military direct deposit with the Wells Fargo Worldwide Military Banking program Minimum to open: $25 Minimum balance: None Overdraft fees: None |
Second Chance Banks by State
How to Open a Second Chance Bank Account
Here are some steps you can take to open a second chance bank account:
- Shop around. Start by researching and comparing top second chance bank accounts like the ones provided above. As you consider your options, look at potential fees, deposit requirements, services and limitations. You can also check to see if the bank will allow you to upgrade your account in the future with responsible use.
- Apply with the financial institution. You can usually apply online, but if the company has physical branches, you can also choose to apply in person. You'll likely need to provide some basic information about yourself, including your name, date of birth, Social Security number, address and contact information, as well as a government-issued photo ID.
- Fund your account. Funding an account can be difficult if you don't have another account from which you can transfer money. Fortunately, many of these accounts don't require opening deposits, so you can set up direct deposit or use a third-party money transfer service to fund the account after opening.
Frequently Asked Questions
The Bottom Line
Second chance banking isn't always ideal, but it's a solid option if you've been denied a traditional checking account. As you work to get back on the right track with your banking, also consider getting a free copy of your credit report from AnnualCreditReport.com, which you can do weekly. You can also check your credit report and FICO® ScoreΘ daily for free with Experian.
While your credit history doesn't have a lot of influence on whether you can get a better bank account in the future, building your credit can help you improve your overall financial standing. Doing so can prevent some of the issues that may have caused your current predicament from happening again.
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About the author
Ben Luthi
Ben Luthi has worked in financial planning, banking and auto finance, and writes about all aspects of money. His work has appeared in Time, Success, USA Today, Credit Karma, NerdWallet, Wirecutter and more.
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