What happens when you open a bank account

Opening a bank account means you give a bank or credit union your personal information, they verify who you are, and then they create an account in your name that lets you deposit money, write checks, use a debit card, and move money electronically. The bank holds your money, keeps track of what you deposit and withdraw, and charges you fees (or doesn't, depending on the account type and the institution). You walk in or go online, answer questions, show ID, and usually leave with a debit card and account number the same day.

The process takes between 15 minutes and an hour in person, or 10 to 20 minutes online. Some banks finish everything on the spot. Others send you a debit card in the mail a few days later. The core steps are the same everywhere: you prove who you are, you choose what type of account you want, you fund it (or don't), and the bank sets it up.

Key Takeaways

  • You need a government-issued photo ID, your Social Security number, and proof of your current address to open an account at most banks and credit unions.
  • Banks check a system called ChexSystems to see if you have had problems with accounts at other banks; a bad history there can block you from opening a new account.
  • You can open an account in person at a branch, online through the bank's website, or by phone with some institutions, and each route takes a different amount of time.
  • Most banks let you open an account with no money down, though some require a minimum deposit of $25 to $100 to set up the account.
  • Once your account is open, you can deposit money by going to a branch, using an ATM, or having your paycheck sent directly to the account.

What ID and documents you need to bring

You will need a government-issued photo ID — a driver's license, passport, state ID card, or military ID. The bank scans or photographs it to confirm your name and date of birth match what you tell them. If your ID is expired, some banks will still accept it; others will not. Call ahead if your ID is more than a year out of date.

You also need your Social Security number. The bank uses this to look you up in credit reporting systems and in ChexSystems, a database that tracks account closures and overdrafts. You will type it in online or tell it to a teller in person.

For proof of address, bring a recent utility bill, lease, mortgage statement, or government mail with your name and current address on it. The document usually has to be dated within the last 60 days. If you do not have one, some banks will accept a bank statement from another institution, a phone bill, or insurance paperwork. A few banks will let you use a secondary ID instead — a student ID or work badge — if you do not have a utility bill.

If you are opening an account online, you will upload photos of your ID and address proof through the bank's website. If you are opening in person, you hand the documents to the teller and they scan them into the system.

How ChexSystems affects whether you can open an account

ChexSystems is a reporting system that banks use to check your history with other banks. It tracks accounts you closed with a negative balance, accounts closed by the bank because of overdrafts or fraud, and sometimes accounts you closed voluntarily. If you have a record in ChexSystems, the bank sees it when you explore.

A bad ChexSystems record does not automatically block you. Some banks have strict policies and will deny you outright. Others will open an account for you but restrict it — no debit card, no overdraft protection, or a lower withdrawal limit. A few banks specialize in second-chance accounts and do not check ChexSystems at all, though they usually charge higher fees.

You can request your own ChexSystems report for free once a year at www.chexsystems.com. If there is an error on your report — a closed account listed as still open, or an account that was not yours — you can dispute it in writing. ChexSystems has 30 days to investigate and correct it or remove it.

If you know you have a bad ChexSystems record, call the bank before you go in or explore online. Ask directly whether they will open an account for someone with that history. Credit unions are often more flexible than large banks on this point.

Opening an account in person versus online

Opening in person at a branch takes 15 to 45 minutes. You walk up to the desk, a banker asks you questions, you show your ID and address proof, you sign forms, and you walk out with a debit card and account number. You can fund the account right there by depositing cash or a check. If something is unclear, you can ask the banker to explain it. The downside is you have to find a branch during business hours and wait if the bank is busy.

Opening online takes 10 to 20 minutes and you can do it at midnight on a Sunday. You enter your name, address, date of birth, and Social Security number into the bank's website. You upload photos of your ID and address proof. You choose your account type and set a PIN. The bank usually approves you when ready or within a few hours. Your debit card arrives in the mail in 7 to 10 business days. The downside is you cannot deposit cash until you have the card, and if the bank rejects your process, you have to call to find out why.

Some banks let you open by phone. You call a number, a representative asks the same questions as a teller would, you give them your ID information verbally, and they mail you a debit card. This is slower than online — approval can take a few days — but faster than waiting for a branch appointment.

If you have no address or an unstable housing situation, opening in person is usually easier because you can explain your situation to a banker and they can note it in your file. Online applications often reject applications from people without a permanent address.

Minimum deposits and account set up

Most banks let you open an account with zero dollars. You get the account number and debit card, and you fund it whenever you want — by direct deposit, by transferring money from another account, or by going to a branch and depositing cash or a check.

Some banks require a minimum opening deposit of $25 to $100. This money goes into your account when ready and counts toward your balance. You are not paying a fee; you are just putting money in. If the bank requires $50 and you deposit $50, you have $50 in the account and can spend it or withdraw it whenever you want.

A few banks have a separate minimum balance requirement — they want you to keep at least $500 in the account at all times, or they charge you a monthly fee. Read the account terms before you open. If you cannot keep a minimum balance, choose an account with no minimum, or choose a different bank.

What happens after you open the account

Once your account is open, you have an account number and a routing number. The routing number is the same for all accounts at that bank; the account number is unique to you. You use these two numbers to set up direct deposit, to transfer money from another bank, or to give to someone who wants to send you money electronically.

Your debit card arrives in the mail if you opened online, or you get it when ready if you opened in person. You can use it to withdraw cash at ATMs, to pay for things in stores, or to pay bills online. Some banks charge a fee if you use an ATM that is not theirs; others reimburse the fee or have a network of ATMs you can use for free.

The bank sends you a statement every month (or you can view it online) showing every deposit, withdrawal, and fee. If you see something you did not do, you report it to the bank within 60 days and they investigate. If it was fraud, they reverse the charge.

Frequently Asked Questions

Can I open a bank account without a Social Security number?

Most banks require a Social Security number because they use it to check ChexSystems and credit reports. Some banks will open an account for someone with an ITIN (Individual Taxpayer Identification Number) instead, which is issued to people who are not may be able to access for a Social Security number. Call the bank and ask whether they accept ITINs before you go in.

What if I do not have a government ID?

Most banks will not open an account without a photo ID. Some credit unions are more flexible and will accept a combination of documents — a passport card, a school ID, a work badge, and a utility bill together. Call ahead and ask what they will accept. If you do not have any ID, you may need to get a state ID card from your DMV first.

How long does it take to get my debit card?

If you open in person, you usually get a debit card the same day or within a few days. If you open online, the card arrives in the mail in 7 to 10 business days. Some banks offer a temporary digital card you can use on your phone when ready while you wait for the physical card.

Can I open an account if I have been banned from banking before?

If you closed an account with a negative balance or the bank closed it because of fraud, you may have a ChexSystems record. Some banks will still open an account for you; others will not. Credit unions and second-chance banking programs are more likely to work with you. Call and ask before you explore.

Do I have to deposit money when I open the account?

Most banks do not require a deposit. You can open the account and fund it later. Some banks do require a minimum opening deposit of $25 to $100. Check the bank's website or call to see whether the account you want has a minimum deposit.