Can You Open A Checking Account With A Bad Credit?

By Dave Nyam •  Updated: 03/23/24 •  5 min read

Obviously, conducting a basic banking operation like creating a checking-based profile nowadays is quite a challenge to people with low ratings. This article tries to delve into the possibilities in an attempt to give answers to an individual needing to open a checking account with less-than-perfect credit scores.

Can You Open A Checking Account With a Bad Score?

One’s poor track of credit doesn’t stand out as a barrier to opening a checking account in South Africa. Although your credit history can determine the kinds of accounts you can open and the features you get, a lot of banks offer products made specifically for a less-than-perfect credit history, according to experts. Often, these are called second-chance checking accounts.

Second-chance checking accounts are bound to have relatively higher fees, or there might be no overdraft facilities connected, but at least it gives one a chance to build their banking history properly and improve credit easily for the individual. Terms and conditions for an account vary per bank, so take the time to make sure to shop around and compare before deciding.

Online banks, in the leap to it, have also come with the rise of fintech and checking accounts with such great features that don’t lean so much on credit history. More often than not, they also partner with traditional banks to offer those FDIC-insured accounts, but with competitive perks even to people with ugly credit.

Can You Open A Bank Account With A Bad Credit History?

A low credit history may bar you from opening a bank account, but one doesn’t necessarily have to have one. However, it may affect the type of accounts you get and the terms associated with the accounts. But there is room for opening one. Most banks offer “second chance” checking accounts to deal with bad credit history or previous bank problems.

These people are usually imposed with some restrictions like no overdraft facilities, plus charges tend to be high. However, they give these individuals an option such that they can try to rebuild their financial history. In a nutshell, the emergence of modern online banking coupled with the emergence of fintech companies, which once were believed to be for the rich, has now given access to people who never thought they’d have in the first place.

While some will provide you with a plain bank account regardless of how poor your credit history is, those generally offer the fewest services compared to people with good credit. You can get the best account by first shopping around and comparing the deals that different banks can offer.

How Do You Qualify For A Checking Account?

The requirements to open a checking account differ in South Africa in the case of a resident or non-resident account. Generally, the following will be required:

Residents’ accounts may require further documentation, such as a declaration indicating the nature of the funds or assets brought into South Africa. But then again, it surely will be better for everyone if they see a bank representative because that way, the process can be guided, and they can learn about other papers to bring. Some special cases may require procedures of their own, so it’s better to consult the bank.

How Long Does It Take To Build Good Credit Scores In South Africa?

Building good credit in South Africa requires several qualities and consistent financial behavior over time. Though you cannot work this in a single night, with all the important steps, you can start seeing the difference within a few months. According to ClearScore ZA, it takes time to grow a good credit score, so you ideally want to start working on it well in advance of needing credit for a big purchase.

Forbes Advisor mentions that, under the FICO scoring model, your score could be generated after at least six months of payment history reported. The time it takes to show strong credit is, in fact, relative to the credit score at the starting point, how consistently you pay on time, and how well you manage your credit accounts.

To build your credit score, you should:

What Is The Easiest Bank To Use To Open A Checking Account?

In South Africa, several banks offer easy processes for opening a checking account. Here are a few options:

Keep Reading

Understanding Credit Searches: Hard And Soft Credit Checks

Understanding Credit Searches: Hard And Soft Credit Checks

We will touch on how you can avoid unnecessary credit searches that can negatively impact your score.

Can Credit Score Improve Through Edgars in South Africa?

Can Credit Score Improve Through Edgars in South Africa?

Can Credit Score Improve Through Edgars in South Africa? Read on to learn how to improve your credit score through Edgars in South Africa. 

What is Required to Check Your Credit Score?

What is Required to Check Your Credit Score?

Today, we will look closer both at the borrower’s side of checking a credit score, and at the lenders

How to Get Your Free Experian Credit Score

How to Get Your Free Experian Credit Score

We’re here today to walk you through how to get your free Experian credit score the easy (and safe) way. 

How to Improve Your Credit Score Without a Credit Card

How to Improve Your Credit Score Without a Credit Card

While the credit card system is one of the easiest ways to build your credit score, Read on to learn how to improve your credit score without a credit card.

How Often Can You Check Your Credit Score

How Often Can You Check Your Credit Score

Also, keeping an eye on your credit score lets you see how it changes over time, which shows you how your finances are doing and point out areas that may need your attention.

What Do Employers Look for in Credit Checks in South Africa?

What Do Employers Look for in Credit Checks in South Africa?

What Do Employers Look for in Credit Checks. This article explores what employers look for when they do credit evaluations in South Africa

What Is A Prime Credit Score

What Is A Prime Credit Score

In this post, we will look at the whole phenomena of prime credit, including its qualification, minimum score for prime credit, and many more. 

How to Check Someone’s Credit Scores For Free

How to Check Someone’s Credit Scores For Free

So, whether you’re a creditor, a curious individual, or a guy trying to understand their fiscal standing, this guide is for you.

How to Get an Experian Credit Score For Free

How to Get an Experian Credit Score For Free

it is crucial to grasp the scoring model being utilised and acknowledge that various lenders may employ different scoring models when making lending decisions.

Where to Check Your Credit Score as a Foreigner

Where to Check Your Credit Score as a Foreigner

With so many foreign nationals contributing positively to our society, this is a rather important question. Today we are here with all the answers. 

Can I Check my Credit Score On the Absa App

Can I Check my Credit Score On the Absa App

Can I Check my Credit Score On the Absa App. Let us look at the possibility of checking your credit score on the Absa app. 

How to Enhance Your Credit Score After Debt Counseling

How to Enhance Your Credit Score After Debt Counseling

Don’t lose hope! You can still take steps to rehabilitate your credit and get yourself to a better place financially. 

How to Have a Spotless Credit Score (South Africa)

How to Have a Spotless Credit Score (South Africa)

You can still have a fantastic credit score that practically guarantees lenders will want to throw money at you without reaching the highest possible score.

How to Get a Home Loan If You Are Blacklisted

How to Get a Home Loan If You Are Blacklisted

However, there’s plenty you can do to correct this, and we have some great advice for you.