Can I Overdraft Chime Card without Direct Deposit [Answered]

Chime offers mobile banking with innovative features and services at almost no fees. One of the features that is available on Chime is the no-fee overdraft, which is a great option as compared to traditional banks, which may subject you to higher fees. If you are wondering-if you can overdraft with Chime without direct deposit, this post may be helpful.

Can I overdraft Chime Card without direct deposit?

No, you cannot overdraft your Chime Card without direct deposit as Chime offers overdraft facility through Spot Me option only, which requires you to have a minimum direct deposit of at least $200 in your Chime account in the last 34 days.

If you attempt to overdraw your card without SpotMe activated, the transaction will be automatically declined.

You can only spend the money you to the extent of your available balance in your Chime account, if you are not enrolled in Spot Me. In absence of Chime Spot Me, your Chime card works just like a prepaid card and not a credit card that will cover the transaction and charge you afterwards.

But if you are eligible for and enroll in the Chime Spot Me , you can overdraw your account up to the limit set by Chime. To enable Chime Spot Me, you need to have a direct deposit of at least $200 or more in your Chime account in the preceeding 34 days, which is the qualifying direct deposit. Also, you need to maintain these direct deposits to continue to have access to Chime Spot Me limit every month.

As per Chime terms, the Direct Deposit has to be a “Qualifying Direct Deposit” i.e. a direct deposit from your employer, payroll provider, gig economy payer, or benefits payer by Automated Clearing House (ACH).

Bank ACH transfers, Pay Friends transfers, verification or trial deposits from financial institutions, peer to peer transfers from services such as PayPal, Cash App, or Venmo, mobile check deposits, cash loads or deposits, one-time direct deposits, such as tax refunds and other similar transactions are not Qualifying Direct Deposits.

Basically, the amount of your direct deposit in Chime account and its continuity is key factor, based on which Chime not only determines your overdraft limit but also takes care of the repayment. The negative balance once you have overdrawn your account, is automatically adjusted against your next direct deposit.

The good thing about the Chime Spot Me is that there is no overdraft fees charged to you. You can choose to give a tip to Chime which is completely optional. Also, signing up for Chime Spot Me does not require a check on your credit score.

How to get enrolled in Chime SpotMe

  1. Go to the Settings tab in your Chime app to check if you’re eligible for the SpotMe feature (make sure you have the latest version of the app).
  2. Agree to the SpotMe Terms and Conditions, if you have read and find them acceptable
  3. Once you’re enrolled in SpotMe, you will be assigned a Spot Me limit which is the maximum amount you can overdraw. The amount starts at $20 and can go up to $200. The limit is auto-determined by Chime depending on your activity and usage and notified to you.
  4. When Chime receives the next direct deposit, it will be automatically applied by Chime to clear your negative balance, without any overdraft fees.

Direct Deposits and its impact on Spot Me

This Spot Me Limit is initially fixed and can be periodically changed by Chime based on your account activity and history. This will include factors like your direct deposit history and direct deposit amounts, spending activity and other risk-based factors etc.

So even the amount of Spot Me Limit is tied in a way to the amount of direct deposit that you have in your account e.g. if you have a direct deposit of $200 per month, you may be given a limit of $20 to start with and if your direct deposit increases to say $400 per month, you may be able to get access to higher overdraft limit of $50 or more.

So even if you initially fulfill the eligibility criteria of having a direct deposit of $200 and enroll in Chime Spot Me, you need to maintain it. If subsequently, you cannot meet such criteria for some reason, your access to Chime SpotMe may be suspended till the time you meet the criteria of necessary direct deposits or terminated.

In fact, there may also be a possibility that Spot Me limits can be revised even downwards if your direct deposit amounts reduce or are not consistent over a period of time.

So it is important that you have a steady stream of direct deposits to have access to Spot Me and also able to maintain your Spot Me limit.

If you are looking for alternate cash advance apps that work with Chime, you can go through the list in our post.

Wrap Up

So direct deposit is key in getting access to the overdraft limit from Chime through Spot Me. It works as an assurance of your repaying ability and increasing direct deposit may also help in increasing overdraft limit over a period of time.

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I have a passion for finance and technology. On this blog, I share helpful information on products and services that we use in our daily lives and simplify things I learned the hard way.

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