You can receive direct deposit into a savings account, prepaid card, or money market account instead of a checking account

Direct deposit does not require a checking account. Your employer or the organization sending you money can deposit your paycheck or benefits into a savings account, a prepaid debit card, or even a money market account — as long as the account has routing and account numbers, which nearly all bank accounts do.

The catch is that not every employer or benefit program accepts every account type. Some will only deposit into checking accounts. Others accept savings accounts but not prepaid cards. Before you choose an account, check with your employer's payroll department or your benefits program to see what they will accept.

Key Takeaways

  • Savings accounts, prepaid debit cards, and money market accounts can all receive direct deposit as long as they have routing and account numbers.
  • Your employer or benefits program decides which account types they will accept, so ask them first before opening a new account.
  • Prepaid cards often charge monthly fees and per-transaction fees, so compare costs before choosing one.
  • If your bank or card issuer does not offer direct deposit, you can still receive your money by having it sent to a different account you control.

Savings accounts that accept direct deposit

Most banks and credit unions will deposit paychecks and benefits directly into a savings account. Call your bank or log into your online account to find your routing number and account number — you will need both to give to your employer or benefits program.

The main difference between a savings account and a checking account is that savings accounts typically limit how many withdrawals you can make per month, though many banks have removed this limit. You can still withdraw money whenever you need it; the limit just means you may face a small fee if you exceed it. For direct deposit, this does not matter — the money goes in, and you decide when to take it out.

If you do not have a bank account yet, opening a savings account is usually simpler than opening a checking account. Many banks require less money to open a savings account, and some have no minimum balance at all.

Prepaid debit cards as an alternative

A prepaid debit card is a card you load money onto in advance, similar to a gift card. Many prepaid cards accept direct deposit, and some are designed specifically for people who do not use traditional bank accounts. You can use the card to buy things or withdraw cash at ATMs.

Before you choose a prepaid card, understand the fees. Most charge a monthly fee between $5 and $15, a fee to load money onto the card, a fee to withdraw cash from an ATM that is not part of their network, and sometimes a fee just to check your balance. These fees add up quickly. Read the fee schedule carefully and compare cards — some have lower fees than others, and a few have no monthly fee at all if you set up direct deposit.

Prepaid cards can be useful if you cannot open a bank account because you do not have an ID or proof of address, since some card issuers have looser requirements than banks. However, they are more expensive than a savings account if you use them regularly.

Money market accounts and other options

A money market account is a hybrid between a savings account and a checking account. It usually pays higher interest than a savings account but may have higher minimum balance requirements. Most money market accounts accept direct deposit, and you can write checks or use a debit card to access your money.

If your current bank does not accept direct deposit into the account type you have, you can open a second account at the same bank or a different bank and have your paycheck deposited there instead. Many people do this — they might have a savings account for emergencies and a checking account for daily spending, with direct deposit going into the checking account.

What information you need to provide

To set up direct deposit, you will need to give your employer or benefits program your routing number and account number. Your routing number identifies your bank or credit union. Your account number identifies your specific account.

You can find both numbers on the bottom left of a check if you have one. If you do not have a check, log into your online banking account or call your bank — they can give you both numbers in seconds. Some banks also print these numbers on statements or in their mobile app.

You may also need to provide your account type — checking, savings, or money market. Your employer or benefits program will tell you if they need this information.

What to do if your bank does not offer direct deposit

Some smaller banks and credit unions do not accept direct deposit, though this is rare. If your bank does not, you have two options: open an account at a different bank that does, or ask your employer to send your paycheck by check or transfer instead.

Opening an account at a second bank is straightforward and costs nothing. You can keep your current account and use the new one only for direct deposit. Many people do this when their employer requires direct deposit but their current bank does not support it.

Setting up direct deposit with your employer or benefits program

Once you have chosen your account and gathered your routing and account numbers, contact your employer's payroll department or your benefits program. They will give you a form to fill out — this might be a paper form, an online form, or a form in their employee portal.

Fill in your routing number, account number, and account type exactly as they appear in your bank records. Double-check the numbers before you submit — a mistake here means your paycheck goes to the wrong account. Most employers will process the change within one or two pay periods.

After you submit the form, ask when the first direct deposit will arrive. Some employers send a small test deposit first to make sure the account information is correct. If you see the test deposit, that means everything worked.

Frequently Asked Questions

Can I use a savings account for direct deposit if my employer usually requires checking?

It depends on your employer. Some employers will only deposit into checking accounts, while others accept savings accounts. Contact your payroll department and ask — they can tell you whether they will accept a savings account for your situation.

Do prepaid cards charge fees for direct deposit?

Most prepaid cards charge a monthly fee even if you use direct deposit, though some waive the monthly fee if you set up direct deposit. They may also charge fees to withdraw cash or check your balance. Read the fee schedule before you choose a card.

What happens if I give my employer the wrong account number?

Your paycheck will go to the wrong account. Contact your payroll department when ready and provide the correct account number. They can usually redirect future paychecks, but recovering a deposit sent to the wrong account takes longer and may require help from both banks.

Can I have direct deposit sent to multiple accounts?

Some employers allow you to split your paycheck between two or more accounts — for example, sending half to savings and half to checking. Ask your payroll department if they offer this option. If they do not, you can set up direct deposit to one account and transfer money to another account yourself.

Do I need a minimum balance to receive direct deposit?

No. Direct deposit works into any account, regardless of balance. However, some banks require a minimum balance to avoid monthly fees, so check your account terms. If you are worried about fees, look for accounts with no minimum balance requirement.