Setting up a bank account might be the first step toward regaining control of your finances. However, not everyone has access to a bank account or a savings account because of bank account application declined.

You are not alone if you are having trouble opening a bank account. If you have a history of mismanaging your money, you may be unable to create a bank account. There are still options available to you, no matter what events brought you to this place. With sufficient patience, you should be able to open a bank account, albeit it may take some time.

Let’s look at what you can do if you are unable to open a bank account.

Bank Account Application Declined

You might be surprised to learn that your bank account application has been turned down. If this occurs, try to figure out why. If you’re informed there’s bad activity on your banking history but something doesn’t seem right, look into it to see if there’s a mistake working against you.

To minimize your credit utilization ratio, the most effective strategy is to pay all of your incoming payments on time and pay off a portion of existing credit card debt.

Checking for inaccuracies on your credit reports is also crucial, since if one of them has an error that is causing you problems, rectifying it can help you get approved for a bank account.

Finally, if you’ve been turned down for a full-service bank account, investigate if you qualify for a second chance account. Some banks provide these simplified accounts that allow you to deposit and withdraw funds but lack the features of conventional checking accounts. It’s a smart strategy to repair your bank’s reputation by opening one.

It’s upsetting to be denied a bank account. If this happens to you, figure out why and make a plan to fix it.

There are so many banks out there with various incentives that it’s a shame you can’t make use of them.

10 Reasons for Being Denied a Checking Account

The following are the most prevalent reasons why banks refuse to open checking accounts:

  • Negative Information on Your ChexSystems Report
  • Errors on your ChexSystems Report
  • Bad Credit
  • The bank is unable to verify your identity
  • Low credit score
  • The bank is unable to verify your identity
  • Outstanding fees
  • Owing money to other accounts
  • Business is out of scope for our accounts 

Negative Information on Your ChexSystems Report

One or more bad things on your ChexSystems report are most likely the reason you were denied a checking account. One or more of the following are common examples of negative information:

  • Involuntary account closure
  • Too many past bounced checks or overdrafts
  • Unpaid fees or negative balances from a current or closed account
  • Suspected fraud or identity theft
  • Too many accounts applied for over a short amount of time
  • Mistakes on your ChexSystems report

 Errors on your ChexSystems Report

Errors may have resulted in negative information on your ChexSystems report. For example, you could have been confused with someone with a similar name, or your Social Security number could have been entered incorrectly.

Fortunately, you may detect these errors and dispute them with ChexSystems when you check your ChexSystems report. When attempting to correct problems in your report, make sure you have any supporting documentation on hand.

 Bad Credit

A low credit score can limit your chances of acquiring a checking account because ChexSystems collects data from both debit and credit accounts. Unpaid fees and debts may be reported by banks and credit unions to collection agencies, which may then report the information to a credit reporting bureau. As a result, your credit score may suffer.

If your bank still refuses to grant you a checking account after you try to remedy these difficulties, you might look into a second-chance bank account.

The bank is unable to verify your identity

Have you recently relocated? Have you renamed yourself? ChexSystems can detect any information that isn’t up to date and prevent you from registering an account.

Examine your most recent ChexSystems report to ensure that all of your personal information is up to date and correctly worded. If your bank is unable to verify your identity, your application for a high-yield savings account may be denied.

Mistakes on your ChexSystems report

While ChexSystems checks for mistakes, it’s possible that the report itself contains an error. If you detect an error in your report, you can file a dispute with ChexSystems to get it corrected.

Because your ChexSystems report will be available for five years as a reference, it’s worth the time to double-check that it’s correct.

Low credit score

The duration of your credit history, your income-to-credit ratio, payment history, and any bad financial events such as bankruptcy all go into determining your credit score. A low credit score, in simple terms, means you’re a higher risk to your bank than a client with a high credit score.

If your credit score is low, you may be turned down for a loan, be denied access to various lines of credit, or be rejected by a high-yield savings account. Credit scores range from 300 to 850 on the FICO scale, but a decent credit score should be above 700.

Outstanding fees

ChexSystems highlights outstanding costs with your existing bank as a possible basis for refusing you a high-yield savings account. Before opening a new type of savings account, be sure you’ve paid off any fees.

However, you can inquire about any outstanding fees related to your account by calling or emailing your bank.

Owing money to other accounts

Candidates with a track record of financial stability and a healthy current account balance are more likely to be selected by banks. After all, it makes little sense for your bank to allow you high-yield savings account if your existing accounts are in the red. Before applying, close your present bank accounts to increase your chances of approval.

Business is out of scope for our accounts 

Most banks are unlikely to engage with companies involved in cryptocurrency, privately held ATMs, marijuana/cannabis, gaming, crowdfunding, or money services.

What to do When You Can’t Open a Checking Account

Here are what you should do after you’ve been denied a checking account:

  • Clean up the information in your ChexSystems report. Request a copy of your report and take action to rectify any bad findings. First and foremost, pay off any outstanding fees. Examine your report for inaccuracies as well.
  • You can file a grievance with ChexSystems and provide supporting evidence if you find any. It’s possible that the investigation will take up to 30 days. Any bad entries that cannot be erased from your report after five years should be removed.
  • Get a free copy of your credit report by filling out the require form. Your credit report and your ChexSystems report both provide you with an excellent indication of your financial situation. Building credit and improving your banking history will help you have a brighter financial future.


Keep in mind that your ultimate goal is to open a regular checking or savings account that allows you to handle your money easily and at a low, or no, cost.

Having a checking and savings account at the same bank can make money management even easier by allowing you to set up automatic transfers from your savings to your checking account.

Learn more:


What does it mean when you can't open a checking account?

The most common reason for account denial is that you have an outstanding debt with a bank – commonly due to unpaid bank fees. If your ChexSystems report indicates that you owe the bank money, you must either negotiate with the bank to pay the debt or reject the report as erroneous.

Can a bank refuse to open an account for you?

If you can’t present the required identification, a bank account application declined is possible because a bank or credit union may refuse to open a checking account for you.

Is it hard to open a checking account?

Opening a bank account is a simple process that involves filling out an application, verifying your identity, providing some basic personal information, and funding your account. In most circumstances, you can apply for a checking account online or at a local branch of your financial institution.

How do you get money out of a closed bank account?

How to retrieve money from a bank account that has been closed is a matter of working with the bank to get your money returned to you. If there isn’t a time frame specified, or if your money doesn’t come on time, contact the bank. It’s possible that you’ll have to phone multiple times before getting a satisfactory response.

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