Chime Bank Review

Monthly bank charges add up.

According to a recent study by Deposit Accounts, the average bank customer pays nearly $34 for an overdraft, $2.28 for an ATM Fee, and $4.58 in monthly fees. This is the nuisance Chime bank wishes to solve.

Chime is a mobile-only, FDIC-insured bank with no monthly fees and no minimum deposit. When opening an account with Chime, you get a checking account (Chime calls it a spending account), a debit card and a savings account.

Designed for banking with a smartphone instead of at a brick-and-mortar location, Chime is advertised as a bank for Millennials. For this reason, Chime works best for anyone with an uncomplicated financial situation, looking to set up an easy mobile-only account.

Below is our review of Chime, including its features, pros and cons of a mobile only bank, and other benefits and disadvantages.

Chime Spending Account Features

While some banks levy monthly maintenance fees, annual fees or closing fees, a spending account at Chime imposes no monthly fees. It also has no minimum balance requirement to set up. For this reason, Chime is a great option for those looking for a no-fee checking account.

Users receive cash rewards on certain purchases and bills. Chime regularly rotates a range of rewards through its app. Sample partners include HotelTonight, Warby Parker, Hulu, and other digitally native brands, with offers ranging from $5 cash back to 10 percent off your next purchase. According to Chime, these rewards will be credited automatically to the member’s spending account within one business day.

Chime allows you to receive access to your pay up to two days earlier when you have your paycheck direct deposited. According to Chime, it immediately processes your employer’s check, meaning you will receive your paycheck earlier than the typical Friday payday. Here, it’s important to read the fine print from Chime’s website:

Faster access to funds is based on a comparison of traditional banking policies and deposit of paper checks from employers and government agencies versus deposits made electronically. Direct Deposit and earlier availability of funds are subject to payer’s support of the feature and timing of payer’s funding.

Finally, Chime has no foreign transaction fees. While other banks can charge up to three percent when shopping or withdrawing money from ATMs overseas, Chime does not charge for these transactions.

Chime Savings Account Features

An advantage of Chime’s saving account is the built-in feature to help you save. The account rounds up every purchase on your Chime card to the nearest dollar and deposits the difference into your savings account.

For example, if a cup of coffee costs you $1.75, Chime will automatically deposit 25 cents into your savings account. You can also set up your account to automatically transfer 10 percent of your paycheck into your savings account. Both these feature are optional.

An additional benefit of banking with Chime is no overdraft fees. If you do not have sufficient funds to cover a purchase, the transaction will be declined. Chime also offers a “split the bill” feature. If you need to split the bill with someone, Chime can send a text message with a link to pay you back using Venmo (a free digital wallet owned by PayPal) or via their own Chime account if they have one.

Mobile App

The Chime app allows you to set up direct deposit, transfer money among your accounts, find an ATM and review your recent transactions. Moreover, Chime’s iOS version is rated 4.8 stars out of 5, and their Android app is rated 4.3 stars out of 5. The app enables you to turn off your debit card instantly. It also notifies you when Chime process transactions to your account.

A disadvantage to this mobile only bank is customer service is only available via chat in the app, by telephone or by email. Further, it may take two to five business days for someone to respond to messages via the mobile app.

Pros

Chime offers several features we like:

No Fees: There are no monthly maintenance or overdraft fees.
Automatic Savings: As noted above, Chime offers ways to automate savings. These features can help customers built an emergency fund or save for a specific goal.
Faster Pay: Chime says you can get access to your pay up to two days earlier.
No Overdraft Line of Credit: Chime doesn’t charge an overdraft fee because it doesn’t permit you to overdraft your account. If you lack the funds to cover a charge, Chime will decline it. Some might describe this as a disadvantage, but we list it here because it can help customers control spending.
Split the Bill: Chime makes it easy to split the bill with friends and family on a night out.
Mobile App: Chime’s mobile app has been well received, based on the iPhone and Android reviews we evaluated.
Free ATMs: Chime offers over 38,000 fee-free ATM locations.

Cons

Nothing in life is perfect, and Chime is no exception:

No Joint Accounts: Banking with Chime is not ideal for those wanting a joint account. It doesn’t offer them.
Cash Deposits Take Work: Since Chime is an online only bank, putting cash into your Chime account is an ordeal. You’ll need to go to a Green Dot cash deposit location, which may charge a fee of up to $4.95 to deposit cash.
Out-of-Network ATM Fees: Although you will have access to over 38,000 MoneyPass ATMs, Chime charges $2.50 per transaction through an out-of-network ATM. There is also a three percent external debit charge (when you load your account via debit instead of a direct transfer).
No Personal Checks: If you need to send a check, Chime will send one for you, though you are limited to $5,000 per payment and $10,000 in a calendar month. Also, your account must be open for at least 30 days before you can use this feature.
Low Interest Rates: Chime’s saving account offers a very low interest rate. Chime’s current rate is an APY of only 0.01%.

How Does Chime Stack Up

Chime’s competition comes from three types of banking products.

Brick and Mortar Banks: The big advantage traditional banks have over Chime and online banks is a physical branch. If talking to your banker face to face is important to you, Chime is not the answer.
Online Banks: With an online bank, you typically get the best interest rates available on deposit accounts and low fees. If a competitive savings rate is your goal, then an online bank is the answer. If what you want is a no-fee checking account with automatic savings features, Chime is worth considering.
Mobile App Banks: Chime isn’t the only banking product to focus on the mobile app experience. Two others are Simple and Aspiration.

The Bottom Line

Chime is designed for those looking for a no fee mobile bank with built-in features to help save and earn extra money.

If you are looking for more traditional bank perks, such as automatic bill pay, physical checks, interest-bearing accounts, joint accounts, or the option to have multiple checking/savings accounts, then Chime is not the optimal choice for you.