What Is a Free Checking Account?

If a checking account has no minimum balance requirement or monthly maintenance costs, it is deemed free. If your direct deposit comes into this account, some banks might provide a checking account that waives the maintenance cost.

Free Checking Account - Laptop

No Monthly Maintenance Fee

Opening a checking account without a deposit doesn’t charge a monthly maintenance fee is possible. It will help if you are looking for a bank that offers this option. Make sure to check what features the account has. For example, it should offer ATM rebates.

Banks that offer this option have lower overhead than brick-and-mortar institutions. In 2009, 76% of banks offered free checking accounts. Today, only 38% do. Many still charge monthly maintenance fees, ATM fees, and overdraft fees.

No Minimum Balance Requirement

Many people need a checking account, and a free checking account with no minimum balance requirement can be a great way to do that. But it would help if you kept in mind that a free checking account may come with other hidden costs. You can be charged monthly maintenance fees or have other restrictions and conditions.

Competitive APY

A free checking account offers a variety of benefits, including no monthly fees, no monthly transaction fees, and no fees if your balance drops below a certain threshold. Traditional brick-and-mortar financial institutions, online-only companies, and hybrid companies offer these accounts. Many of them offer competitive APYs and even rewards for account holders. Some have low initial deposit requirements, while others have additional requirements to earn the highest rate. Most also require enrollment in online banking.

If you’re in the market for a free checking account, look for one that offers a competitive APY. No Fee Reimbursement

Free checking accounts can be convenient and easy to use. Many offer free checkbooks, no per-check fee, or both. However, some financial institutions charge a fee if you write too many monthly checks. Others allow you to use their ATMs for free, which is a great feature for those who don’t want to incur out-of-network fees.

Besides free checking, these accounts can also come with low-fees and minimal requirements. They are a great option for those who avoid paying monthly maintenance, ATM, and overdraft fees. Some banks also charge fees for debit cards, wire transfers, and returned deposits. These fees can eat into your budget.

Online-Only Banks

While some online-only banks offer free checking accounts, they all have a few things in common. For one, these accounts do not have monthly maintenance fees, overdraft fees, or paper statement fees. Additionally, they do not require a smartphone app, which is a big plus for some people.

Free checking accounts are becoming rarer over the years, however. In 2009, 76% of banks offered free checking accounts, compared to just 38% of banks today. In addition to monthly maintenance fees, many banks charge overdraft fees and ATM fees, which erode the value of free checking.


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