Chime Bank Review

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Can’t remember the last time you went into a physical bank branch? That might mean Chime, or a bank like it, is for you. Designed originally as a bank for millennials, Chime can be a good bank for nearly anyone interested in mobile banking.

The bank was created in 2013 by Chris Britt and Ryan King. It’s completely online, so there are no branches or ATMs of its own, but it does offer a large fee-free ATM network through partner banks. For most users, that is not necessarily a bad thing. Accounts are protected by the FDIC just like the branch on the corner, so you still have all the security of a traditional bank without all the fees and fluff.

And that’s really where Chime shines: banking there is as fee-free as you can get. Here’s a bit more about the bank and how it works.

Chime Bank at a glance

Bank Minimum Savings Deposit Maximum Savings APY 1-Year CD Rate J.D. Power Survey Score Key Benefit
Chime Bank $0 .01% N/A N/A No fees

What we like about it

The most important thing to love about Chime Bank is the absence of fees. Essentially, the bank makes money from Visa each time you use your Visa debit card. Without the overhead of large banks, they don’t need to rely on fees to support a large infrastructure. In fact, the only fee you’ll normally encounter will be a $2.50 out-of-network ATM fee.

Even that is not likely. You can use any MoneyPass or Visa Plus Alliance ATMs for free. The app and interface are both easy to use, the app has some great features and opening an account takes only five short minutes. You can either use the micro-savings feature, and round up purchases to the nearest dollar and put the rest in savings, or you can automatically have 10% of your payroll direct deposit routed to savings. Both are optional.

So users are saving money by not paying recurring bank fees and overdraft charges, and actually saving money becomes simple with Chime.

Things to consider

Every bank has downsides, and Chime is no exception. First, due to lack of physical locations, depositing cash is extremely difficult unless you do so through another external account you have linked to the Chime app.

There is a mobile check deposit feature, but reviewers have complained that it is difficult to use. Direct deposit seems to be the best way to get money into your account. To add to the frustration, customer service also takes a long time to respond through the app — a matter of days, not hours.

The only other major issue? The savings rate is exceptionally low, approaching zero. It’s almost not worth putting money in the account and leaving it there. The only advantage is that it won’t show on your checking balance, so hopefully, you will not be as tempted to spend it.

If you’re looking for high, or even decent, yield, Chime is not the place to get it. There are also no physical checks available, although there is a workaround.

Chime checking accounts

When you first sign up, you’re signing up for Chime’s Spending account. This is essentially a checking account. There is no minimum balance, and you can and should use direct deposit. Getting money into the account, especially cash, is really difficult and must be done through Green Spot, which usually charges fees.

For a checking account, there are no physical checks offered. However, once you have an account for more than 30 days, you can send a check through the app’s checkbook feature. Essentially, they’re printing a check and sending it for you.

There are also some other handy features. There are cash-back rewards from some retailers and other places, and they change from time to time, giving the program some flexibility. There is also a great Split the Bill feature, which will send a text message to the person of your choice with a link to pay you back through Venmo or Chime if they also have an account.

Chime savings accounts

There are a couple of cool ways to save with Chime. The first is the micro-savings feature, which is similar to other banks’ “round-up” features. Purchases can be rounded up to the nearest dollar, and the remainder put in savings. It’s amazing how fast those small amounts can add up.

You can also set the account up so that 10% of direct deposits are put automatically into savings. Both of these programs are not required.

There are two things to consider about savings. For one thing, when you sign up for Chime, you are signing up for a spending account first. To sign up for a savings account, you will have to sign up a second time through the app, giving them all of your information all over again. The second issue is the savings rate, as discussed above: at 0.01%, it is so close to zero that it’s almost like it isn’t even there.

The savings account is more to keep your balance out of your spending account so you won’t touch it.

Chime money market accounts

Like many other online-only challenger banks, Chime does not offer a full suite of financial investing products. If you’re looking for a money market account, try one with BBVA. With BBVA, customers enjoy 1.90% APY — one of the highest on the market — with any amount of deposit. So if you have only a little bit of cash lying around or you’re looking to throw a big windfall somewhere to grow, BBVA’s money market account will get the job done.

Chime CDs

As stated, Chime bank doesn’t have certificates of deposit to offer for customers. This is typical for challenger banks like Chime. For decent, low-deposit CDs, try Barclays. Any deposit amount will work, from $1 to $100,000 and will enjoy an APY of at least 2.00% APY for 1- to 4-year terms. Although there’s no real point in depositing only $1 into a CD, those who want to see real returns on their investments will enjoy the benefits that Barclays has to offer.

Chime IRA accounts

IRAs are typically offered only by established financial institutions like Bank of America, HSBC or other banking goliaths, so you won’t find any retirement investing options with Chime. For those ready to plan for retirement, try opening an IRA with TD Ameritrade. First, customers can receive a $600 bonus if they roll over an old 401(k). There’s no account minimum and customers will have access to financial advisors to help them make the best decisions regarding their money for retirement.

Chime credit cards

Chime Bank doesn’t offer any credit cards, unfortunately. It’s definitely something to consider when looking for a new bank, but many people have credit cards with institutions they don’t bank with, too. Credit card issuer giant, Capital One, offers a wide variety of credit cards to suit multiple lifestyles and spending habits. Although it ends up with a $95 annual fee after the first year, the Capital One® Venture® Rewards Credit Card comes with 2x the miles per dollar spent and 50,000 miles sign-up bonus when you spend $3,000 in the first three months. This is a good credit card for those who like to travel rather than stay-cation and appreciate deals on flights, hotels and car rentals.

Chime investing

Chime has no investing plans, so you’ll need an app like Robinhood, a more traditional trading app like E*Trade or another similar app if you want to trade in mutual funds. Robinhood is a popular investing app that has added a flair of gamification to make investing engaging and more accessible to even the most novice of investors.

The bottom line

Upon review, Chime is a great bank for those who are more comfortable with virtual banking than with a brick-and-mortar institution, and also those who only need pretty basic financial services. If you need full-service banking or work with cash a lot, Chime may not be the right answer for you. If you’re looking for a fee-free checking alternative, however, Chime is worth a closer look.

Editorial Note: Compensation does not influence our recommendations. However, we may earn a commission on sales from the companies featured in this post. To view a list of partners, click here. Opinions expressed here are the author's alone, and have not been reviewed, approved or otherwise endorsed by our advertisers. Reasonable efforts are made to present accurate info, however all information is presented without warranty. Consult our advertiser's page for terms & conditions.

The responses below are not provided or commissioned by the bank advertiser. Responses have not been reviewed, approved, or otherwise endorsed by the bank advertiser. It is not the bank advertiser’s responsibility to ensure all posts and/or questions are answered.

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