The Big Bank Challenge is a social media trend where people close accounts at large national banks and move their money to smaller institutions
The Big Bank Challenge is not a formal program or official movement. It started as a hashtag and social media campaign, most visibly in 2023, encouraging people to shift their deposits from major banks (often called "big banks" or "megabanks") to community banks, credit unions, or online banks. The idea behind it is straightforward: moving your money concentrates deposits at smaller institutions instead of the largest financial companies in the country.
People participate for different reasons. Some object to the fees large banks charge. Others want to support local financial institutions. Some are frustrated with customer service at major chains. The challenge itself has no official rules, no important date, and no organization running it—it is straightforward a trend that spreads when people talk about it online and encourage others to do the same.
Key Takeaways
- The Big Bank Challenge is a social media movement encouraging people to move deposits from large national banks to smaller banks and credit unions.
- Switching banks involves opening a new account, transferring your direct deposits and automatic payments, and closing your old account once the transition is complete.
- Community banks and credit unions often charge lower fees and offer more personalized service, but may have fewer ATMs and branches than large banks.
- Moving your money does not affect your credit score, and your deposits remain insured by the FDIC or NCUA up to the legal limits at any bank.
Why people participate in the Big Bank Challenge
The most common reason people cite is frustration with fees. Large banks often charge monthly maintenance fees, overdraft fees, ATM fees, and minimum balance requirements. A community bank or credit union may offer checking accounts with no monthly fee, no minimum balance, and no overdraft charges if you stay within your means.
A second reason is the desire to support local institutions. Community banks and credit unions keep more of their profits in the local economy and often lend to small businesses and homebuyers in their own region. When you move money to a smaller institution, you are redirecting capital away from national megabanks and toward institutions with different lending practices.
Some people switch because they want better customer service. Large banks often rely on phone trees, online chat, and app-based support. Credit unions and community banks typically have local branches where you can speak to someone who knows your account and can make decisions on the spot.
How to switch banks if you decide to move
Switching is a straightforward process, though it takes time. Start by opening an account at the bank or credit union where you want to move your money. You will need a government-issued ID and proof of address (usually a recent utility bill or lease). This takes about 15 minutes in person or online.
Next, update your direct deposits. Contact your employer's payroll department and provide your new account number and routing number. This typically takes one pay cycle to take effect. At the same time, identify any automatic payments coming out of your old account—subscriptions, insurance, loan payments, utilities—and update those with your new account details.
Once your direct deposits have moved and you have redirected your automatic payments, wait for your old account to empty naturally. Do not close the old account when ready; wait until you are certain no pending transactions are still processing. This usually takes two to four weeks. Then contact your old bank and close the account.
Differences between big banks, community banks, and credit unions
The institutions you choose from have real differences in how they operate and what they charge. Understanding these differences helps you decide whether switching makes sense for your situation.
| Feature | Large National Banks | Community Banks | Credit Unions |
|---|---|---|---|
| Monthly account fees | Often $10–$15 per month | Usually $0–$5 or waived with direct deposit | Usually $0–$3 or waived |
| Overdraft fees | $30–$35 per overdraft | $15–$25 or may be waived | $15–$25 or may be waived |
| ATM network | Thousands nationwide, plus surcharge-free partners | Limited to local area; may charge for out-of-network ATMs | Access to shared branching and ATM networks; varies by union |
| Customer service | Phone, chat, app; limited local branch access | Local branch with staff who know your account | Local branch; member-focused service |
| Loan approval | Algorithm-based; less flexibility | Relationship-based; more flexibility for local borrowers | Member-based; often more flexible for members |
Large banks compete on convenience and digital tools. Smaller institutions compete on fees, service, and lending flexibility. Which matters more depends on how you use your account and what frustrates you most about your current bank.
What does not change when you switch banks
Your credit score is not affected by opening a new bank account or closing an old one. Banks do not report checking or savings accounts to credit bureaus. Only credit products—credit cards, loans, lines of credit—show up on your credit report.
Your deposits remain protected by the Federal Deposit Insurance Corporation (FDIC) at banks or the National Credit Union Administration (NCUA) at credit unions. Both insure up to $250,000 per depositor per institution. If you have more than $250,000, you can spread it across multiple banks to keep all of it insured, but the Big Bank Challenge does not require you to do this.
Your ability to use debit cards, online banking, and bill pay continues without interruption once your new account is set up. Most banks and credit unions offer the same digital tools as large banks, though the interface may look different.
Potential drawbacks of leaving a large bank
The main trade-off is convenience. Large banks have thousands of ATMs and branches nationwide. If you travel frequently or move often, a community bank's limited footprint may be frustrating. Many community banks and credit unions have joined shared branching networks to address this, but the coverage is still smaller than a megabank's.
Some online banks and smaller institutions offer lower interest rates on savings accounts than others, though this varies month to month. Compare rates before you switch if you are holding a large balance in savings. Credit unions require membership, which usually means living or working in a specific area, belonging to a certain employer, or being part of an organization. Not everyone qualifies for every credit union, so check membership requirements before you open an account.
Is the Big Bank Challenge right for you
The decision to switch banks is personal and depends on what matters most to you. If you are paying high fees at your current bank and have a community bank or credit union nearby, switching could save you money and give you better service. If you travel frequently, need a large ATM network, or are satisfied with your current bank, staying put is a reasonable choice.
You do not have to participate in a social media trend to make a financial decision that works for you. The Big Bank Challenge is straightforward a conversation starter. The real question is whether your current bank is serving your needs at a fair price. If the answer is no, moving your money is always an option.
Frequently Asked Questions
Does switching banks hurt my credit?
No. Banks do not report checking or savings accounts to credit bureaus. Only credit products like credit cards and loans affect your credit score. Opening a new bank account and closing an old one has no impact on your credit.
What happens to my debit card when I switch banks?
Your old debit card will stop working once you close the account. Your new bank will issue you a new debit card, which usually arrives within 7 to 10 business days. Until it arrives, you can withdraw cash at ATMs or in-branch using your account number.
Can I keep both accounts open at the same time?
Yes. Many people keep their old account open for a few weeks while they transition, just to make sure no pending transactions are still processing. Once you are confident everything has moved, you can close the old account. There is no penalty for having multiple accounts at different banks.
What if my new bank does not have an ATM near me?
Many credit unions and smaller banks belong to shared branching networks that let you use other institutions' ATMs and branches without a fee. Ask your new bank which networks they participate in. Some online banks also reimburse out-of-network ATM fees, so check their policy.
How long does it take to switch banks completely?
Opening a new account takes 15 minutes to an hour. Redirecting direct deposits takes one pay cycle. Updating automatic payments takes a few days to a week. Waiting for your old account to fully empty takes two to four weeks. Total time is usually four to six weeks from start to finish.