Is a Checking Account Good for Your Credit Score?

By Kenny Zhu · September 19, 2022 · 9 minute read

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Is a Checking Account Good for Your Credit Score?

Even though checking accounts can be the heartbeat of your financial transactions, opening one of these accounts usually doesn’t help your credit score.

Note the use of the word “usually,” though. As time passes after you open your account, a well-maintained banking life can be a vital step towards building a positive financial history. On the other hand, it’s worth noting that there are times when a checking account can actually lower those three digits that determine your credit-worthiness.

So let’s equip you with the information you need to know about this important financial topic. We’ll take a closer look at why credit scores are important, how opening a checking account typically impacts — or doesn’t impact — your score, as well as the times when your checking account can lower (ouch) your score.

Does Having a Bank Account Affect Your Credit Score?

In general, bank accounts have little to no direct impact on building your credit score, as FICO scores only track the activity on your credit accounts. While your credit report may list the existence of any bank accounts you own, it will not track the balance of those accounts.

The important aspects of account ownership are that you keep your account positive and promptly pay off any overdrafts. If you can do that, you should be able to avoid any negative impact on your credit score.

Does Opening a Checking Account Affect Credit Score?

While opening a checking account often has virtually no impact on your credit score, there are exceptions. Most banks will check your credit score when you open a bank account with what is known as a “soft inquiry.” This means they aren’t doing a “hard inquiry” in which they would access and review your full credit report. These kinds of “hard pulls,” which tend to indicate you may be applying for more credit, can lower a person’s credit score. You can ask a bank in advance if they do a hard pull when you apply to open a checking account. If the answer is yes, you may decide to do your business elsewhere.

But let’s consider one important scenario in which a checking account might affect your credit score:

You Apply for Overdraft Protection

When you apply for overdraft protection, you are basically requesting a line of credit. If you dip into negative balance territory, you are asking the bank to shore you up. In order to assess if you are a good risk for this kind of loan, the bank will delve into your credit report. This situation can cause your credit score to dip.

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Situations When Your Credit Score May Be Impacted

Now that you know about opening a bank account and its impact on your credit score. But what about as you go about your business, doing those typical transactions in checking and savings accounts? Could that cause your credit score to go up or down?

Typically, these transactions are not recorded on your credit report. Certain issues, however, that relate to using your bank accounts do have the potential to impact your credit score if they’re not resolved in a timely manner. Let us give you a heads-up about these scenarios.

Bank Makes a Hard Inquiry

As previously mentioned, if you apply for overdraft protection or a similar line-of-credit service on your bank account, the bank may do a “hard inquiry” on your credit report. A single hard pull on your credit report typically won’t have a lasting impact on your credit score, however multiple hard pulls within a short period of time can drop your credit score by a few points.

Failing to Pay Overdraft Fees

If you fail to pay overdraft fees in a timely manner, they will show up as debt on your record. Sometimes fees may seem like “no big deal,” but they truly do matter. If you have unpaid overdraft fees, they can wind up on your credit report, just like any other unpaid debts. It’s not a good look and can lower your score.

Closing an Account With a Negative Balance

If you fail to pay off your negative balance before closing your bank account, your bank may send the account off to collections. This is likely to have a substantial negative impact on your credit score, as it’s a failure to pay your debts.

If you plan on closing any bank accounts, always make sure you also close out any outstanding balances in your account. Failure to do so will show up on your credit report as a collections event.

Overdrafts and Bounced Checks

Regular overdrafts on your accounts and continually writing bad checks won’t directly impact your credit score. That said, failure to repay the subsequent overdraft fees and bad check fees may result in those penalties being submitted to collections, which will negatively impact your credit score. For this reason, you should check your account balance regularly to ensure the amount isn’t tipping into negative territory. Mobile banking apps make that a quick and simple process.

Debit Card and ATM Abuse

Constantly using your debit card and withdrawing cash from ATMs without regard for your account balance can negatively impact your credit score if you overdraw your account. The failure to pay those overdraft fees can result in a collections event which can negatively impact your credit score.

Here’s another angle to consider: Debit card and cash transactions are not reported on your credit report. Over-reliance on your debit card will actually prevent you from building a proper credit history. While some of us may be averse to using credit cards for every transaction, they’re a solid tool for building up your credit score when used responsibly.

Suspected Fraud

Whether due to fraud or by mistake, unauthorized transactions that end up overdrawing your account can negatively impact your credit score. If someone opens a bank account in your name and conducts fraudulent activity, the consequences of those actions could become a black mark on your credit report.

It’s a good idea to monitor your bank accounts regularly for any signs of fraudulent activity. By federal law, everyone is entitled to one free credit report every year from You can download your credit report and check for any mistakes in your account before they become a problem. Notice unfamiliar or incorrect activity on your report? Let the credit reporting agencies know, as well as law enforcement if needed.

Why Credit Scores Are Important

Credit scores are a way to measure how well a person handles debt: Do they pay on time? Do they owe a small or steep amount of money? The scores are calculated by the three big credit reporting agencies, Equifax, Experian, and TransUnion. A credit score tops out at 850, with 720 and up being considered excellent.

Establishing good credit is important because your score will help lenders determine whether you’re creditworthy. This is most important when it comes to two things: Determining whether or not you get approved for a loan, and — if you are approved, setting the rates and terms on your loan.

Here’s a list some of the key benefits to a good credit score:

•   Lower rates on mortgages, credit cards, auto, and private student loans

•   Higher chance of approval on credit applications

•   Better insurance rates

•   Easier time getting approved for housing rentals

•   Higher borrowing limits on credit cards and lines of credit

•   Ability to bypass security deposits or pay lower amounts in some cases

Those with low credit scores or who lack a credit history will have difficulty qualifying when they apply for new credit accounts; this includes loans, credit cards, mortgages, and rental homes. If they do qualify, their rates may well be higher than those offered to someone with a higher credit score.

How big a difference could this make? A very big difference, to be honest. To illustrate what a lower credit score may cost you: A credit score in the low-600s may be quoted a mortgage rate that’s up to 1.5% higher than someone with a 750+ credit score. Over the life of the loan, that 1.5% difference can cost you an extra $50,000 more in interest over the life of a $200,000 mortgage loan.

So, it can certainly pay to tend to one’s score, getting and keeping that number as high as possible. Now, let’s look at how bank accounts can impact your credit score.

The Importance of Managing Your Checking Account

Your checking account is the foundation of so much of your financial life. Chances are, your paycheck and all your bills cycle through your checking account. Automatic payments and debit card purchases all rely on that account having a positive balance.

While life today moves at warp speed and it’s easy to get distracted, it’s a good habit to check your account at least weekly, if not more often. The goal here is to make sure you haven’t overdrawn your account, that you know your balance, and that you’re attuned to any unauthorized activity that might crop up.

The Takeaway

Opening and maintaining a checking account doesn’t necessarily have any impact on your credit score. However, responsibly managing your checking account is an important facet of living your best financial life. It’s the key to avoiding any unnecessary fees, ensuring that you have enough funds to cover daily transactions, and making sure your credit score doesn’t suffer. By watching your balance and reviewing your account history, you can keep your checking account in top shape.

Another way to keep your account in great condition is to find a banking partner that gives you lofty interest rates and negligible fees. For instance, here at SoFi Checking and Savings, we offer a competitive APY on accounts that have direct deposit. Plus, we charge zero account fees and you can access your paycheck up to two days early.

Better banking is here with up to 4.60% APY on SoFi Checking and Savings.


Does opening a checking account help your credit score?

Typically, opening a checking account neither helps nor hurts your credit score. There are, however, certain situations (like applying for overdraft protection) that might lower your score.

Does owing a bank money affect your credit?

If you owe a bank overdraft or other fees, yes, it can negatively affect your credit. Just like any other unpaid bills, these delinquent charges can go on your credit report and lower your credit score. They show that you aren’t doing an A-plus job of managing your money and your debts.

What bank accounts help build credit?

The details of your bank accounts typically are not filed with the three credit reporting agencies and therefore not build or harm your credit. However, if you have unpaid fees on a bank account and certain other conditions, those could hurt your credit.

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SoFi members with direct deposit activity can earn 4.60% annual percentage yield (APY) on savings balances (including Vaults) and 0.50% APY on checking balances. Direct Deposit means a deposit to an account holder’s SoFi Checking or Savings account, including payroll, pension, or government payments (e.g., Social Security), made by the account holder’s employer, payroll or benefits provider or government agency (“Direct Deposit”) via the Automated Clearing House (“ACH”) Network during a 30-day Evaluation Period (as defined below). Deposits that are not from an employer or government agency, including but not limited to check deposits, peer-to-peer transfers (e.g., transfers from PayPal, Venmo, etc.), merchant transactions (e.g., transactions from PayPal, Stripe, Square, etc.), and bank ACH funds transfers and wire transfers from external accounts, do not constitute Direct Deposit activity. There is no minimum Direct Deposit amount required to qualify for the stated interest rate.

SoFi members with Qualifying Deposits can earn 4.60% APY on savings balances (including Vaults) and 0.50% APY on checking balances. Qualifying Deposits means one or more deposits that, in the aggregate, are equal to or greater than $5,000 to an account holder’s SoFi Checking and Savings account (“Qualifying Deposits”) during a 30-day Evaluation Period (as defined below). Qualifying Deposits only include those deposits from the following eligible sources: (i) ACH transfers, (ii) inbound wire transfers, (iii) peer-to-peer transfers (i.e., external transfers from PayPal, Venmo, etc. and internal peer-to-peer transfers from a SoFi account belonging to another account holder), (iv) check deposits, (v) instant funding to your SoFi Bank Debit Card, (vi) push payments to your SoFi Bank Debit Card, and (vii) cash deposits. Qualifying Deposits do not include: (i) transfers between an account holder’s Checking account, Savings account, and/or Vaults; (ii) interest payments; (iii) bonuses issued by SoFi Bank or its affiliates; or (iv) credits, reversals, and refunds from SoFi Bank, N.A. (“SoFi Bank”) or from a merchant.

SoFi Bank shall, in its sole discretion, assess each account holder’s Direct Deposit activity and Qualifying Deposits throughout each 30-Day Evaluation Period to determine the applicability of rates and may request additional documentation for verification of eligibility. The 30-Day Evaluation Period refers to the “Start Date” and “End Date” set forth on the APY Details page of your account, which comprises a period of 30 calendar days (the “30-Day Evaluation Period”). You can access the APY Details page at any time by logging into your SoFi account on the SoFi mobile app or SoFi website and selecting either (i) Banking > Savings > Current APY or (ii) Banking > Checking > Current APY. Upon receiving a Direct Deposit or $5,000 in Qualifying Deposits to your account, you will begin earning 4.60% APY on savings balances (including Vaults) and 0.50% on checking balances on or before the following calendar day. You will continue to earn these APYs for (i) the remainder of the current 30-Day Evaluation Period and through the end of the subsequent 30-Day Evaluation Period and (ii) any following 30-day Evaluation Periods during which SoFi Bank determines you to have Direct Deposit activity or $5,000 in Qualifying Deposits without interruption.

SoFi Bank reserves the right to grant a grace period to account holders following a change in Direct Deposit activity or Qualifying Deposits activity before adjusting rates. If SoFi Bank grants you a grace period, the dates for such grace period will be reflected on the APY Details page of your account. If SoFi Bank determines that you did not have Direct Deposit activity or $5,000 in Qualifying Deposits during the current 30-day Evaluation Period and, if applicable, the grace period, then you will begin earning the rates earned by account holders without either Direct Deposit or Qualifying Deposits until you have Direct Deposit activity or $5,000 in Qualifying Deposits in a subsequent 30-Day Evaluation Period. For the avoidance of doubt, an account holder with both Direct Deposit activity and Qualifying Deposits will earn the rates earned by account holders with Direct Deposit.

Members without either Direct Deposit activity or Qualifying Deposits, as determined by SoFi Bank, during a 30-Day Evaluation Period and, if applicable, the grace period, will earn 1.20% APY on savings balances (including Vaults) and 0.50% APY on checking balances.

Interest rates are variable and subject to change at any time. These rates are current as of 10/24/2023. There is no minimum balance requirement. Additional information can be found at

Financial Tips & Strategies: The tips provided on this website are of a general nature and do not take into account your specific objectives, financial situation, and needs. You should always consider their appropriateness given your own circumstances.

Disclaimer: Many factors affect your credit scores and the interest rates you may receive. SoFi is not a Credit Repair Organization as defined under federal or state law, including the Credit Repair Organizations Act. SoFi does not provide “credit repair” services or advice or assistance regarding “rebuilding” or “improving” your credit record, credit history, or credit rating. For details, see the FTC’s website .

Photo credit: iStock/Delmaine Donson

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