Updated March 22, 2024

Banks with No Overdraft Fees

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Banks are slowly starting to ditch overdraft fees. If you're looking to open a new account without overdraft fees, here are some of the top picks.

What bank has no overdraft fees?
Here are the best banks with no overdraft fees:
  1. Ally Bank
  2. Axos Bank
  3. Discover® Bank
  4. Capital One
  5. Citibank
  6. Chime
  7. SoFi
  8. Alliant Credit Union

Overdraft fees can pile up and eat into your savings, making them quite frustrating. This is especially true for those who are trying to get by on a lower income.

To help you avoid these overdraft fees, here's a list of banks that don't have them at all.

What is your primary reason for choosing a bank with no overdraft fees?

Best Banks With No Overdraft Fees

Overdraft fees can be heavy on your bank account, so do yourself a favor and ditch them. Here are some of the top picks for banks that don't charge any overdraft fees.

What are overdraft fees?
Overdraft fees are charges that occur when you make a purchase and don't have enough money in your account to cover it. In some cases, the bank will lend you money to clear the purchase but will charge you an overdraft fee on top of that.

Use this calculator to find out how much you can save by choosing a bank that has no overdraft fees.

Overdraft Incident Cost Avoidance Calculator

How do you prefer banks communicate their overdraft policies?

Ally Bank

If you're looking for an account that doesn't charge any overdraft fees, Ally Bank is a great place to start.

With their Spending account, if you don't have enough funds to cover a purchase, Ally has the choice of paying the rest or denying the transaction completely. Either way, you won't be charged any overdraft fees.

Additionally, Ally has an overdraft service called CoverDraft which will provide up to $250 in relief for common transactions.[1]

To qualify for CoverDraft, you'll first need to deposit $100 or more into your Spending account. Your basic coverage will start at $100, but setting up direct deposit and receiving at least $250 for two months in a row will get it up to $250.[2]

If your balance goes negative with the Ally Spending account, you'll have 14 days to bring it back to the positive. Failing to do so could result in Ally restricting your withdrawals.

Why we like Ally Bank:
Aside from overdraft fees, Ally also does not charge for the following:[2]

  • Monthly maintenance fees
  • Standard or expedited ACH transfers
  • Incoming wires (domestic and international)
  • Official and cashier's checks

They offer competitive APYs on both their Spending and Savings accounts as well. Of course, if you want the higher APY, go with the Savings account.

Both these accounts have a unique feature called buckets. For the Spending account, you have spending buckets that let you set money aside for scheduled expenses like rent and groceries.

For the Savings account, you'll have savings buckets that you can use to stash your cash and track your savings progress—all while earning interest.


  • Overdraft coverage
  • Spending and Savings accounts available
  • No monthly maintenance fees
  • No physical locations
  • No cash deposits

Axos Bank

Axos Bank's Essential and Rewards Checking accounts don't charge any fees for overdrafts or non-sufficient funds. This means you won't get penalized for accidentally overspending.

Why we like Axos Bank:
Axos provides two great account options for your needs. For a basic checking approach, go with the Essential Checking account. If you're looking for opportunities to earn interest, the Rewards Checking account provides a really competitive APY.

Both these accounts have $0 monthly maintenance fees and no minimum monthly balance requirements. On top of that, they also include unlimited domestic ATM fee reimbursements.[3]

Pros + Cons:

  • No overdraft fees on both checking accounts
  • Competitive APY
  • Unlimited domestic ATM fee reimbursements
  • No physical branches

How do overdraft fees work?
Let's say you have $100 in your account. Unfortunately, your car breaks down and the repairs are worth $150. Since you're short $50, the bank lends it to you so the purchase clears. If that bank had a $30 overdraft fee, you'd have to pay back the $50 with an additional $30. In the end, you would have a negative balance of $80.

Discover® Bank

Discover® Bank offers a checking account with no overdraft fees. This is because, if you accidentally go over your balance, the transaction will be declined.

Luckily, you can get alerts to let you know when your balance is low, allowing you to prevent it from happening.

They also have a free overdraft protection service that you can opt into. This allows you to transfer funds (for free) from another linked Discover account into your checking account to avoid any declined transactions.

Why we like Discover® Bank:
With Discover® Cashback Debit account, you have the added benefit of getting a 1% cashback on up to $3,000 on debit card purchases each month.[4]

It also boasts $0 monthly maintenance fees, no opening deposit, and no minimum balance requirements.

Lastly, Discover offers very competitive rates and features on their savings and checking accounts.

Pros + Cons:

  • No monthly maintenance fees
  • No minimum balance requirements
  • No opening deposit
  • Cash back on debit card purchases
  • Only one physical location

Capital One

Capital One has a 360 Checking Account with no overdraft fees.

With this checking account, you have multiple overdraft options:[5]

  • Auto-Decline: This allows you to automatically decline transactions that'll cause overdrafts.
  • Free Transfer: With this option, you can transfer funds automatically from a savings or money market account (for free).
  • No-Fee Overdraft: If your funds can't cover a purchase, Capital One has the choice of declining or approving it. Approved transactions that put your balance below $0 won't come with any fees.

For the No-Fee Overdraft option, it's best that you deposit additional funds into your account as soon as possible. If your balance remains negative, they won't approve additional transactions that will continue to overdraw your account. They may even close your account and impact your ability to open more accounts with Capital One or other financial institutions.

Why we like Capital One:
On top of no overdraft fees, the Capital One 360 Checking account also has a decent APY. This means you save money by avoiding fees while earning extra through interest.

There are also no service fees, no minimum balance requirements, and no foreign transaction fees.

Pros + Cons:

  • Minimum balance requirements
  • No foreign transaction fees
  • No service fees
  • Early direct deposit
  • Lower APY compared to others
  • Limited branch locations


As of 2022, Citibank has eliminated overdraft fees—which is rare for traditional banks. If you want no overdraft charges, you can check out their Basic Banking Package checking account.[6]

They have an overdraft protection feature called the Safety Check which will withdraw money from your savings or money market account and transfer it into your checking account in case you overspend.[7]

Why we like Citibank:
While many Citi accounts have monthly fees, you can often have them waived depending on the account you choose.

Citi offers two types of accounts: Everyday and Premium. Everyday accounts are basic accounts for most people, while Premium accounts appeal to a more specific clientele. This gives you options to choose from.

Pros + Cons:

  • Overdraft protection
  • 65,000+ ATMs nationwide
  • Potential monthly charges
  • Out-of-network ATM fees

Do all banks have overdraft fees?
Not all banks have overdraft fees. Some banks completely remove overdraft fees, while others provide overdraft protection, giving you extra time to fix a negative balance in your checking account.


Although Chime technically isn't a bank, they offer basic mobile banking services that make managing your money easy and free. Their online checking account comes with no monthly fees, no minimum balance requirement, and no overdraft fees.

They also have an overdraft protection program called SpotMe. With this, Chime will cover up to $200 on your debit card purchases and cash withdrawals with no overdraft fees.[8]

To enroll in SpotMe, you'll need to receive $200 or more in qualifying direct deposits within 34 days and activate your Chime debit card. From there, you can open your app, head to the Settings tab, and opt-in for SpotMe.

To raise your SpotMe limit, you can get boosted by friends. In the same breath, you can boost your friends and raise their limits by sending them boosts in $5 increments.

Why we like Chime:
The Chime mobile app is an award-winning platform with a 4.8 rating on both the App Store and Google Play Store. Thus, it is a great place to start if you plan on going the mobile banking route.

Creating an account is also incredibly quick and easy. You just need to provide your name, date of birth, address, and Social Security number and you'll be done in two minutes. From there, just download the app and you're ready to get started.

Pros + Cons:

  • Highly-rated mobile app
  • Overdraft protection (up to $200)
  • No monthly fees
  • Large ATM network
  • Difficult to deposit cash
  • Out-of-network ATM charges

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


SoFi's Checking and Savings account is not only one of the best rewards checking accounts out there, but it also offers a fee-free overdraft coverage program.

With this account, you'll be covered up to $50 with no fees on your debit card purchases. However, to be able to get this coverage, you'll need to have monthly direct deposits of $1,000 or more.[9]

Why we like SoFi:
The SoFi's Checking and Savings account offers up to a 15% cashback at participating local establishments when you pay with your SoFi debit card.

And since this account also functions as a savings account, it has a really competitive APY on your savings balance.

If you don't have an account yet, SoFi will often offer cash bonuses for signing up and setting up direct deposit. Be sure to check out the offer they have now and see if you qualify for a cash bonus.

Pros + Cons:

  • Cashback rewards
  • No account and overdraft fees
  • No account minimums
  • Requirements for overdraft coverage
  • Cash deposit fees
  • Rate and benefits depend on deposit activity

Alliant Credit Union

Alliant Credit Union's High-Rate Checking account offers no overdraft fees, no monthly fees, and no account minimums.

They also have a free overdraft protection service. So if you ever find yourself with insufficient funds to clear a transaction, funds can automatically be transferred from your Alliant Savings or Supplemental Savings to cover the overdraft.[10]

Why we like Alliant Credit Union:
Alliant's High-Rate Checking Account also offers a better-than-average rate, allowing you to earn interest on your money.

Additionally, you also get $20/month in ATM fee rebates, letting you avoid more fees in the process.

Pros + Cons:

  • Overdraft protection
  • No monthly fees
  • No minimum balance requirements
  • $20/month in ATM rebates
  • Limited physical branches

How Overdraft Services Work

Each overdraft service will differ per bank. Here are the most common ones:

  • Decline transaction
    To completely avoid any overdraft, banks may just deny transactions that will put your balance on the negative.

  • Overdraft protection transfer
    Instead of paying to complete the transaction themselves, the banks may grab funds from your linked accounts and transfer them automatically into your checking account.

  • Overdraft coverage
    To help you clear the transaction, the banks may pay for the remaining funds needed. Your account will still reflect a negative balance and the bank will often give you a specific amount of time to bring it out of negative status.

  • Overdraft line of credit
    Just like overdraft coverage, the bank will lend you money to cover the transaction. However, what they'll charge you is interest on the loan at a rate similar to credit cards (and potentially a transfer fee). Just be sure to pay the loan back as soon as possible.

Relying on overdraft services should be a last resort. Use this free budget calculator to plan your monthly expenses and avoid overdraft situations.

How To Choose A Bank With No Overdraft Fees

Before you dive wallet-first into a new bank account, here are a few things that you should keep in mind:

  • Overdraft options
    Banks deal with overdrafts differently. Before creating an account, find out what kind of protection services they offer and how much time you have to clear your negative balance.

  • Fees and minimums
    Sure, there aren't any overdraft fees, but are there monthly service fees or minimum balance requirements? It's important that you look beyond overdraft fees so that you get the full picture of the charges you'll encounter.

  • Other features
    A bank that doesn't charge overdraft fees is a great thing. However, it isn't the be-all and end-all. You also need to check what features they offer that suit the type of banking you need.

Which additional feature is most important to you in a bank account with no overdraft fees?

Why Are Banks Eliminating Overdraft Fees

More and more banks are beginning to eliminate overdraft fees—but why?

The banking landscape is changing. Banks are getting more and more competitive, and they've caught on to the fact that customers don't like paying fees.

Smaller banks and mobile banking fintech companies are also sprouting up and challenging traditional banks. To stay competitive, banks are eliminating overdraft fees.

They're also noticing that getting rid of overdraft fees opens up the door for more financial inclusivity. People, especially those with lower incomes, will have an easier time establishing and maintaining financial security.


To come up with a list of banks, we looked at several banks that didn't charge any overdraft fees. Then we checked which of them offered the best overdraft protection services.

On top of that, we looked at additional features that came with the accounts of each bank. This is so that we had a list of banks that not only featured fee-free overdraft protection services but also features that provide helpful benefits in everyday banking.

What the Experts Say

CreditDonkey asked a panel of industry experts to answer readers' most pressing questions. Here's what they said:

Bottom Line

Overdraft fees are a pain. Luckily, there are a couple of banking options you could go with to avoid them completely.

You could opt for a more traditional bank like Citibank, or you could go with modern one like Chime. Either way, you can save a lot of money with their overdraft services.

Ultimately, when choosing a bank, consider both the overdraft fees and how you want them to handle your money.


  1. ^ Ally. Introducing CoverDraft — take the stress out of accidental overspending, Retrieved 10/16/2023
  2. ^ Ally. Straight Talk Product Guide: Ally Bank Spending Account, Retrieved 11/21/2023
  3. ^ Axos Bank. Compare Checking Accounts, Retrieved 10/16/2023
  4. ^ Discover. Earn cash back rewards with no fees, Retrieved 10/16/2023
  5. ^ Capital One. Overdraft Options, Retrieved 10/5/2023
  6. ^ Citi. Basic Banking Package, Retrieved 10/16/2023
  7. ^ Citi. Safety Check, Retrieved 10/5/2023
  8. ^ Chime. Overdraft worries? Not with SpotMe, Retrieved 10/16/2023
  9. ^ SoFi. We've got your back with no-fee Overdraft Coverage, Retrieved 10/16/2023
  10. ^ Alliant. High-yield checking account with no overdraft fees, Retrieved 10/16/2023

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