![]() ![]() Unpaid fees, especially overdraft fees.Neobanks, like other banking institutions, can close accounts without notice, but most closures occur for one of only a few reasons, including: But it also admitted that several of the closures brought to its attention had been mistakes. In ProPublica’s report, Chime said many account closures are linked to fraud, such as wrongfully receiving stimulus payments. Crooks may open multiple accounts under false identities to try to receive money from hacked bank accounts or collect improper government benefits. The easy sign-up process makes neobanks targets for fraudsters, according to a 2019 report by the National Consumer Law Center. Chime and Varo don’t check applicants’ credit, nor do they disqualify people who have been rejected by banks before. Chime’s website estimates that the process takes two minutes, and the website of Varo, another neobank, says it's five minutes. Neobanks often promise a quick account setup with limited background checks. ![]() ![]() Complaints to the CFPB also mention slow response times, sometimes weeks, from Chime customer support. Of those complaints, 197 - more than 20% - were categorized as involving a closed account. Chime “has according to experts been generating a high rate of complaints, with 920 filed at the Consumer Financial Protection Bureau since April 15, 2020,” ProPublica reported. ![]()
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