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When the founders of Chime got together to create a next generation online bank, they had one target in mind – millennials. Who else would appreciate the simple, no-nonsense, and absolutely free approach to mobile banking but the more technologically savvy generation?
Chime is one of the first new banks to be created in the smartphone era almost exclusively for smartphone users, offering a full-feature app that actually allows you to do much of your banking on the go.
In the three years since its launch, the upstart bank has attracted more than 100,000 customers while raising $24 million in venture capital. Chime’s mission is to “empower people to lead healthier financial lives” by positively changing money management behaviors.
This Chime Bank review will cover just how they’re doing it.
The Chime Bank App
Say goodbye to hidden bank fees with Chime
- No monthly or overdraft fees
- No minimum balance requirements
- Daily balance updates
- Receive $5 free when you open an account
The Chime Bank app is the foundation on which all of the bank’s technology is built, so you would expect it to do more than just tell you what’s in your account. In addition to the more common functions, such as checking balances and moving money between accounts, the Chime app helps users stay right on top of their banking with daily balance updates, instant transactions alerts, and real-time deposit notifications.
The app also allows customers to pay their bills and send paper checks when needed. The app actually creates the check and mails it at no additional charge. The funds are debited from your account the instant the check is mailed.
If you lose your debit card, you can temporarily block it with the click of a button. There’s even a chat feature that instantly puts you in touch with a customer service representative.
Chime “Spending Account”
That’s what Chime calls its checking account. It is completely free – no minimum balance requirements, no monthly fees, and no overdraft fees. You can’t overspend on your account because all your spending is done with a debit card and Chime will deny transactions when your account has insufficient funds. In the rare event your account does go negative, Chime will automatically transfer money from your savings account to cover the deficit.
One downside that could be a deal breaker for some customers is that Chime doesn’t allow joint accounts. So, if you’re married with a desire to bank jointly, Chime may not be for you. However, Chime is working on adding this feature in the near future.
Another limiting factor is, when using the Chime checkbook feature, if you need to write a check for more than $5,000 you are out of luck. Chime limits the check amount on a single transaction to $5,000 and $10,000 for the month.
Free ATM Access
Chime customers have access to more than 24,000 ATMs in the MoneyPass network. The app has an ATM locator, but, in the event you can’t find a MoneyPass location, you will be charged $2.50 for a withdrawal.
Chime Savings Accounts
If you don’t think you will need a Chime Bank Savings Account, you would be wrong. Chime has introduced an automatic savings program that will round up every purchase you make with your debit card to the nearest dollar and then deposit it into your savings account. On average, Chime customers swipe their debt cards 30 to 40 times a month. That translates into an average of $400 of savings each year!
Otherwise, there is no minimum balance requirement or monthly fee. Funds can easily be transferred between your Spending Account and Savings Account using the Chime app. Although the interest rate is rock-bottom-low at 0.01%, you can earn savings rewards of up to $500 a year, which more than makes up for it.
No Paper Check Deposits
One downside is the Chime app isn’t yet set up for paper check deposits, something many of its bank competitors offer. However, Chime is working on the feature and expects to roll it out in the near future. Of course, you can set your account up for direct deposit, and if you need to make a cash deposit, you can do so at any of the 60,000 Green Dot locations nationwide; however a small fee may apply.
Based on customer reviews found online, this doesn’t appear to be a real deal breaker because most people in the younger generations don’t have a need to deposit checks. With all of the payment methods available, such as SquareCash, PayPal, and Chime’s own payment features, checks are almost entirely passé.
Chime Bank Pros
- Really cool mobile app
- More mobile banking features available
- Completely free (except for out-of-network ATM fees)
- Automatic savings
- Savings rewards
Chime Bank Cons
- Won’t work for joint bankers
- No remote check deposits
- Cap on check amount
Author: Jeff Gitlen