Non Chexsystems Banks

Chexsystems is a check verification service developed by eFunds (now EFD) used by a network of member financial institutions to aid in credit lending decisions. It also functions as a credit reporting service, much like Experian, TransUnion, and Equifax. Chexsystems products include DebitBureau, DebitReport, FraudFinder, Identity Theft, ID Verification, ICMS, ProspectChex, QualiFile, and Transaction Monitoring, and are all designed to track any irregularities in a customers’ banking transactions. A Chexsystems report will include such things as check overdrafts, unsatisfied balances, depositing fraudulent checks, or suspicious account handling that have occurred at a member bank within the previous five years. Based on the information in a Chexsystems report, banks can refuse to open new accounts and deny credit for prospective new customers. However there are banks that don’t use the Chexsystems service, known as non chexsystems banks.

Chexsystems is now in use by 80 percent of financial institutions in the United States. According to EFD, 9,000 banks and credit unions utilize Chexsystems, comprising over 100,000 distinct branch locations. Chexsystems was designated as a consumer reporting agency (CRA) in 1999, thus falling under the regulation of the Fair Credit Reporting Act. Consumers now have the right to request an annual credit report, dispute any unfavorable items and demand proof of the accuracy of reported information.

Chexsystems has been criticized for what many consider to be unfair reporting practices. Chexsystems reports contain only negative data, in contrast to other CRAs that report both positive and negative information. Also, Chexsystems reports contain no risk analysis scores, such as a FICO score. Therefore long-standing customers with excellent relationships with their bank could find their accounts closed and be prevented from opening new accounts based on a solitary banking error. The Greenlining Institute, a consumer advocacy group based in Berkley California, released a report outlining wide discrepancies in the criteria used by Chexsystems member institutions in reporting negative items.

Once a negative item shows up in a report it is detrimental at every other member location. Every other Chexsystems bank will have access to the same information and will likely use it to deny new accounts to those with a bad report. With the sheer number of member locations, consumers may find it very difficult to open a new bank account.
Not all banks and credit unions are members of the Chexsystems network. Some use different CRAs such as TeleCheck or Equifax. Even if someone has a negative Chexsystems report, there are still banks that are willing to assist them.

The following is a listing of non chexsystems banks and credit unions that don’t use Chexsystems or are willing to overlook its reports. Additional information is included, such as branch locations and which CRA they use, if any.

Non Chexsystems Banks List:

Marketplace Bank

This bank has branch locations in select Winn-Dixie stores throughout Florida as well as being an online bank. They use Equifax to verify credit for new accounts.

Netbank

Netbank does use Chexsystems but will still grant accounts if a few negatives show up in a report. You can also fund your initial deposit with your credit card.

RBC Centura

This non chexsystems bank verifies new accounts using the BEACON score from your Equifax report.

TD Waterhouse Online Bank

The online brokerage firm has been refusing to open new accounts but there is a method that works with them. If you open an IRA account for as little as $50, you will be able to open a checking account with them in a week or so. The IRA makes you a brokerage customer, enabling you to avoid monthly service charges on the checking account. If they should deny your account, be advised that there may be a delay in receiving your initial deposit back.

Frost National Bank

This bank will open an account for you despite negative items on your Chexsystems account if you can obtain a letter from the reporting institution saying that you don’t owe them any money. Their Frost Direct account even includes a Visa CheckCard.

USAA

USAA is reported to help people even with a negative Chexsystems report.

nBank.com

This online bank uses your Equifax report to verify your account rather than Chexsystems.

Clarity Bank

Another one of these online non chexsystems banks that utilises Equifax.

American Express Membership B@nking

AE does use Chexsystems as well as carrying out a credit check. A good credit check will usually override a bad Chexsystems report (however, a good Chexsystems report will not override a bad credit report). They are also slow in returning initial deposit money if your account application is denied.

Bank Caroline

Bank Caroline uses both Chexsystems and Equifax to make decisions on new accounts. Minor negatives on the Chexsystems report that have been paid off don’t seem to be detrimental to opening an account. Be forewarned that a single overdraft on your account will cause your ATM/Visa debit card to be disabled for up to two months!

Western Union

While not offering any traditional banking services, Western Union offers prepaid MasterCard credit cards with no bank account required at all. They are purported to have a $10 per month Cash Card as well, which allows you to make withdrawals and deposits at ATMs and Western Union agent locations.

Skylight Bank

Formerly DBC Financial, Skylight offers their Stratus Card to anyone, regardless of their Chexsystems report, for a $19.95 sign-up fee and a $6.95 per month finance charge.

PayPal

An alternative to traditional bank accounts, PayPal allows you to send payments via email with funds that you provide to the service or from your credit card. As a person to person service, no credit check is performed at all. You will need a credit card to register for the service, as well as with Yahoo! PayDirect and PayMe.com. You can also register with PayPal using an existing savings or checking account. PayPal also offers a Debit MasterCard that allows you to access the funds in your PayPal account directly.

Yahoo! PayDirect

Another person to person payment service, similar to Paypal. A major credit card is required to register and open an account.

Help us Find Other Non Chexsystems Banks

If you know of any other non chexsystems banks please leave a comment for us below and we’ll update the list.