8 Best Banks for Overdrafts

SoFi® charges no overdraft fees, and customers can also opt into two different options to cover their accounts in case of an overdraft. The first option is free overdraft protection, which automatically transfers money from a customer's savings balance to cover the transaction.

The second option is no-fee overdraft coverage, where SoFi will cover a debit card transaction that would result in an overdraft of up to $50, as long as a customer qualifies by making $1,000 or more in direct deposits per month.

More from SoFi: "We do not charge any account, service or maintenance fees for SoFi Checking and Savings. We do charge a transaction fee to process each outgoing wire transfer. SoFi does not charge a fee for incoming wire transfers, however the sending bank may charge a fee. Our fee policy is subject to change at any time. See the SoFi Bank Fee Sheet for details at sofi.com/legal/banking-fees/."

"Overdraft Coverage is a feature automatically offered to SoFi Checking and Savings account holders who receive at least $1,000 or more in Eligible Direct Deposits within a rolling 31 calendar day period on a recurring basis. Eligible Direct Deposit is defined on the SoFi Bank Rate Sheet, available at https://www.sofi.com/legal/banking-rate-sheet. Members enrolled in Overdraft Coverage may be covered for up to $50 in negative balances on SoFi Bank debit card purchases only. Overdraft Coverage does not apply to P2P transfers, bill payments, checks, or other non-debit card transactions. Members with a prior history of unpaid negative balances are not eligible for Overdraft Coverage. Eligibility for Overdraft Coverage is determined by SoFi Bank in its sole discretion. Members can check their enrollment status, if eligible, at any time by logging into their account through the SoFi app or on the SoFi website."

Alliant Credit Union doesn’t charge overdraft fees, and it offers two free services that customers can enroll in to cover overdrafts.

The first service is overdraft protection, where customers can transfer funds from their linked Alliant savings account to cover an overdraft.

With the second service, courtesy pay, Alliant will cover checks, electronic payments and transfers that extend beyond the amount that your overdraft protection would cover. To qualify for courtesy pay, customers must be Alliant Credit Union members for six months and have deposits totaling at least $600 per month into their checking account. The overdraft amount must also be paid back immediately.

Ally has no overdraft fees for any of its accounts, and there are two options for overdraft protection.

The first option is to set up free overdraft protection transfers from a linked Ally savings account or money market account. The transfer will be rounded to the nearest $100 and sent to the customer’s checking account.

The second option is Ally’s CoverDraft℠ service, which provides up to $250 in coverage in case a customer overdrafts. A customer can qualify for CoverDraft 30 days after making a $100 deposit into their checking account, which means they receive basic overdraft coverage up to $100. Among banks with free overdraft coverage programs, Ally stands out for only needing a deposit, not a direct deposit, to receive up to $100 in coverage.

If a customer does have direct deposits of at least $250 for two months in a row, they qualify for up to $250 of full coverage. Direct deposits at least every 45 days are required to keep coverage. If a customer overspends, their next deposit will apply to their negative balance, and they have 14 days to bring their account back to a positive balance.

Ally says: "Keep in mind, CoverDraft isn’t a line of credit or a guarantee. If your purchase isn’t covered for any reason (let’s say the transaction exceeds your CoverDraft limit, for example), it will be declined - but we’ll never charge you an overdraft fee."

Chime charges no overdraft fees, and customers can get access to Chime’s SpotMe® program for no-fee overdraft. Customers can qualify by making a monthly direct deposit of $200 or more and activating their Chime Visa® Debit Card or Chime Card™, and they are initially given a $20 overdraft limit that can eventually be increased to $200. Chime suggests tipping for the service — a feature more common among cash advance apps — and it’s optional. Qualifying for the SpotMe program also gives customers access to Chime+, which includes more perks such as priority customer support and cash back rewards.

If you have friends who are Chime customers, you can also send a SpotMe Boost, which will temporarily raise your friend’s overdraft limit by $5. You can send and receive up to four Boosts per month, and you can only send one Boost per friend per month.

Note that Chime is not a bank; it is a financial technology company, also called a neobank, that partners with banks to offer this account. This distinction is important as it affects how your money is protected.

» Learn more about how your money is insured at a neobank

Chime is a financial technology company, not a bank. Banking services provided by The Bancorp Bank, N.A. or Stride Bank, N.A., Members FDIC.

Chime says:

"SpotMe® on Debit is an optional, no fee overdraft service attached to your Chime Checking Account. To qualify for the SpotMe on Debit service, you must receive $200 or more in qualifying direct deposits to your Chime Checking Account each month and have activated your physical Chime Visa® Debit Card or Chime Card™.

Qualifying members will be allowed to overdraw their Chime Checking Account for up to $20 on debit card purchases and cash withdrawals initially but may later be eligible for a higher limit of up to $200 or more based on Chime Account history, direct deposit frequency and amount, spending activity and other risk-based factors. The SpotMe on Debit limit will be displayed within the Chime mobile app and is subject to change at any time, at Chime's sole discretion. Although Chime does not charge any overdraft fees for SpotMe on Debit, there may be out-of-network or third-party fees associated with ATM transactions. SpotMe on Debit will not cover any non-debit card transactions, including ACH transfers, Pay Anyone transfers, or Chime Checkbook transactions. SpotMe on Debit Terms and Conditions."

“To apply for a Chime Card, Chime® Checking Account is required to apply.”

“SpotMe ® Boost is an optional, no fee service feature of SpotMe. Boosts are available to eligible Chime members enrolled in SpotMe and are subject to limits. See Terms and Conditions.”

"Tipping or not tipping has no impact on your eligibility for SpotMe."

Self-Help Credit Union charges no overdraft fees and offers two ways to cover an overdraft: a free overdraft protection transfer service from a linked account and an overdraft line of credit. While there’s no fee on the line of credit, you’d pay interest on the overdrawn amount, which can be cheaper than a steep overdraft fee.

There is a $5 monthly fee for the credit union’s checking account, which is waived if you are 24 years old or under, 65 years old or over, make $500 or more in direct deposits per month, or maintain a daily combined balance of $2,500 or more in your Self-Help Credit Union accounts. To become a member at this credit union, you can pay a one-time $5 fee or be a resident in Florida, Georgia, North Carolina, or Virginia.

OnePay doesn’t charge any overdraft fees. If a customer is a OnePay Cash+ customer, meaning they deposit at least $500 into their OnePay account each month (or maintain a $5,000 balance), they have access to up to a personalized limit in overdraft coverage linked to their Debit balance, which is OnePay’s version of a checking account. A customer’s limit can change over time. Although called “Overdraft Protection,” this service functions as overdraft coverage instead of overdraft protection transfers. The negative balance is automatically repaid with the next deposit or transfer a customer makes into their Debit balance, which should happen as soon as possible.

Note that OnePay, backed by Walmart, is not a bank; it is a financial technology company, also called a neobank, that partners with a bank to offer this account. This distinction is important as it affects how your money is protected.

In addition to charging no overdraft fees, Capital One has a few ways to cover overdrafts. There are free transfers from a linked savings account to checking. There’s also a no-fee overdraft option for covering checks, electronic bill payments and recurring debit card payments.

You can opt in to cover, at no fee, ATM withdrawals and one-time debit card purchases. Not every fee-free overdraft program covers as many types of debit transactions. While there’s no requirement for the free transfers, the no-fee coverage option requires at least $250 in deposits within the past two out of three months. It’s not available right away to new customers. For customers wary of overspending, there is an option to have all transactions auto-decline if they’d overdraft an account. There are no fees for a declined transaction.

The financial tech firm Current offers a fee-free overdraft program that starts at $25 and the limit can vary based on direct deposits, account activity and other factors. Eligibility requires monthly direct deposits of at least $200, and unlike some others on our list, no other types of deposits make a customer eligible. What is unique is that this overdraft coverage applies to customers who have the Current debit card as well as the Build credit card, and a customer’s overdraft limit is the same when using either card. Overdraft programs typically only cover debit transactions. Current has no other overdraft services but no overdraft-related fees either.