Where to Open a Business Checking Account With No ChexSystems Report

Banks generally don’t run a credit check when you apply for a business checking account. But many will look at your ChexSystems report, which shows your history with previous checking and savings accounts. (Credit reports don’t include this information.)

A ChexSystems report lists actions such as bounced checks, overdraft fees and forced closed accounts that may make getting approved for a new bank account more difficult.

Some financial institutions don’t use ChexSystems for business checking applicants. Others offer “second chance” accounts to those with imperfect banking histories.

Here’s where to look for these business bank accounts, as well as how to work toward improving your ChexSystems report for the future.

Business checking accounts with no ChexSystems

Banks typically don’t share publicly whether or not they use ChexSystems, which can lead to confusion about the topic. But most financial institutions use ChexSystems or other research tools as part of their decision-making process for new accounts.

NerdWallet reached out to multiple financial institutions about whether they use ChexSystems. The neobanks Mercury and Novo confirmed they do not. Both companies offer online business bank accounts with no monthly fees.

If you’re curious about whether an institution uses ChexSystems, you have the option to ask them directly. Some will answer; others won’t. And if you apply and get denied, that shouldn't result in additional negative marks on your ChexSystems report.

» MORE: What you need to open a business bank account

What is a second chance business account?

Second chance checking accounts are designed for people who have been denied a bank account due to a negative ChexSystems report. These accounts are more common for personal banking than for business banking — but second chance business checking does exist.

For example, Woodforest National Bank offers a Second Chance Business Checking account designed for business owners who have experienced previous bank account challenges. This account includes 250 fee-free transactions per month and a business debit card, but it has a $15 monthly maintenance fee and a setup fee.

Woodforest’s other business checking accounts, on the other hand, come with lower monthly fees that can be waived based on your account balance.

Local banks and credit unions

If you don't have access to Woodforest, research local business checking options — this page’s list of free business checking accounts by state might be a good place to start. Contact a representative to discuss the application process and whether they use ChexSystems or offer second chance business checking.

» MORE: Best credit unions for business banking

What to do if you’ve been denied a business account

In general, if you have a negative ChexSystems report and have been denied a business bank account, do the following:

• Take steps to improve your ChexSystems report. If possible, fixing your report will be best for you and your business. More on how to do this below.

• See if your local or regional bank offers a second chance business account. This may be a good choice for your business if you prefer brick-and-mortar banking to online banking or rely on cash transactions.

• Seek out banks that don’t use ChexSystems. These are often financial technology companies or neobanks, which may make them a better fit for customers who prefer online banking and don’t handle much cash — and don’t mind losing out on that in-person support.

• Compare your options. You’re more likely to avoid a monthly fee with a no ChexSystems account, but a second chance option may offer different features you value (like branch access). Look for the account that best fits your business’s needs.

How to improve your ChexSystems report

ChexSystems retains a record of reported information for up to five years, so investing the time will benefit you and your business in the long run.

Here’s what you can do to improve your ChexSystems report over time:

Request your report. Once every 12 months, you are entitled to a free copy of your ChexSystems report, called the “consumer disclosure report.” Request the report on the ChexSystems website, by mail, phone or fax.

Identify any errors. After you’ve received your report, look for any errors that may be listed. Check for outdated information, misreporting or any other mistakes.

File a dispute if necessary. If you find errors on your report, you can file a dispute to have the ChexSystems record corrected. ChexSystems allows you to file a dispute online, by mail or by fax. You also have the option to submit the dispute directly to the source of the information, like the bank or credit union, or have ChexSystems contact the source on your behalf to start the investigation.

When you file a dispute, include any documentation you have to support your correction, such as bank statements, payment receipts, or other similar information. Investigations are typically completed in 30 days, after which time ChexSystems will notify you of the results by mail.

If the investigation confirms that there are inaccuracies on your report, ChexSystems is required by federal law to remove them.

Pay any debts. If your report shows legitimate money owed — in the form of overdrawn accounts or unpaid fees — you’ll want to take any steps you can to pay those debts.

Ask creditors to update your record. Financial institutions are required to update your ChexSystems report after you’ve paid or settled your debt. To ensure that this happens as quickly as possible, you can ask creditors directly to update your file after you’ve paid your debts.

» MORE: 5 steps to clear up your ChexSystems record

If your ChexSystems report improves quickly, you can apply to open a business checking account online (or in person) without having to seek out bank accounts with no ChexSystems check. To determine which account is right for your business, you’ll want to consider fees, transaction limits, ATM access and other features.

Can you open a business account with no credit check?

Yes, you can open a business bank account with no credit check. Banks generally don’t check your credit report before approving an application for a business checking account.

Your credit report shows lenders your history of paying back debt on time and in full. For that reason, credit checks are most common when you’re applying for financing, like a business credit card or business loan.

Banks may look at ChexSystems to see if you have a history of forced closed accounts or overdrafts. But while the majority of lenders and credit card companies will do a credit check, not all banks use ChexSystems.