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The short answer
Before opening a checking account, many US banks look at a checking account consumer report from a company such as ChexSystems or Early Warning Services. The CFPB says banks report unpaid negative balances on accounts they closed, suspected fraud and bad cheques, and that most negative information cannot be reported after seven years. If you are refused, the bank must send an adverse action notice naming the company, and you can get your report free and dispute errors in writing.
Many newcomers assume a bank refusal is about immigration status or credit score. Often it is neither. Banks check a separate kind of report, about how you have handled checking accounts, and a mark there can come from an old account you thought was closed, a negative balance you never saw, or someone else using your details.
What a checking account report is
The CFPB calls these checking account consumer reports and names Chex Systems, Inc. and Early Warning Services, LLC as the two largest companies. They are separate from Equifax, Experian and TransUnion, and from your credit score. Banks and credit unions supply information to them and read it when you apply.
What gets reported
- An unpaid negative balance, such as an overdraft, on an account the bank closed involuntarily.
- Suspected fraud.
- A history of writing bad cheques.
- Joint accounts with someone who had any of these problems.
How long it stays
The CFPB says the Fair Credit Reporting Act generally stops most negative information older than seven years from being reported, and that some checking account reporting companies disregard information more than five years old. Do not assume an entry will disappear soon; check the dates on your own report.
If a bank refuses you
When a bank refuses you because of what a report says, it must send an adverse action notice naming the reporting company and giving its contact details. Keep that notice. It is how you know which company to contact, and it entitles you to a free copy of that report. Separately, the CFPB says nationwide reporting companies must give you one free report a year on request, from each company.
Disputing an entry
- Get the report from the company named in the notice, using the contact details on the notice or the company's website.
- Mark each wrong entry: an account that is not yours, a balance you paid, a wrong date or amount.
- Write to the reporting company explaining what is wrong, with copies of evidence. The CFPB provides sample dispute letters.
- Write to the bank that supplied the entry too. Both have a duty to investigate and correct inaccurate information.
- Keep identity documents ready. The CFPB notes you may be asked for your Social Security card, and that reporting identity theft to the FTC can help if fraud is involved.
- Add a statement if the dispute does not go your way. The company must include your short explanation in reports it issues about you.
If you cannot get a response, you can submit a complaint to the CFPB online.
If the entry is accurate
An accurate entry for an unpaid balance can usually be improved by paying it. Contact the bank that reported it, pay the amount, and ask in writing for the account to be updated as paid. That does not remove the history, but a paid entry reads differently to the next bank.
While the entry stands, ask banks and credit unions whether they offer accounts for people with a checking report history, sometimes called second-chance accounts, and read their fees and limits before you open one. Some banks use only one of the two reporting companies, so a refusal at one bank does not always mean a refusal everywhere. Our guide to opening a US bank account as a new immigrant covers documents.
Keeping your record clean from the start
- Turn on low-balance alerts so an overdraft does not sit unnoticed.
- Close accounts formally, in writing, with a zero balance, rather than leaving them unused. Fees on a forgotten account can create a negative balance.
- Never deposit a cheque from someone you met online who asks you to send part of the money back; fake-cheque scams leave the depositor owing the bank.
- Keep the bank updated with your address when you move, so closure letters and final statements reach you.
- Be careful who you add to a joint account; the CFPB notes that joint accounts with someone who had problems can be reported.
Newcomers with no history
If you have never had a US account, you have no checking report, which is not a reason to refuse you. A refusal in that situation more often comes from identity verification, for example a name on your passport that does not match what you typed, or an address that cannot be checked. Our guide to opening an account with a Nigerian passport covers what to bring, and why banks close accounts explains how marks are created.
Where Pryme fits
While you sort out a US account, a Pryme account opened from the US holds dollars and naira, so salary and family support have somewhere to sit (multicurrency). Pryme accounts are not a substitute for every function of a US checking account, and outside Nigeria Pryme's services are provided through regulated partners.
Questions people ask
Why was I denied a bank account in the US?
Often because of a checking account report from a company such as ChexSystems or Early Warning Services, or because the bank could not verify your identity. The bank's adverse action notice should say which report it used.
How long does ChexSystems keep records?
The CFPB says most negative information cannot be reported after seven years, and some checking account reporting companies disregard information more than five years old. Check the dates on your own report.
How do I get my ChexSystems report free?
You can ask for one free report a year, and a free copy after a bank refuses you based on it. Use the contact details on the adverse action notice or the company's website.
Can I remove a ChexSystems record?
You can dispute inaccurate entries with the company and the bank that reported them, and both must investigate. Accurate entries can be updated as paid once you settle the balance.
Sources
- CFPB: What is a checking account consumer report? (reviewed 18 December 2024) · accessed Oct 2026
- CFPB: How do I dispute an error on my checking account consumer report? (reviewed 5 September 2025) · accessed Oct 2026
This article is general information, not financial, legal or tax advice. Products described are provided under the terms on this site and are subject to regulation and eligibility.