If You Closed a Chime Account, the Banking App Might Owe You $150 or More. Here's Why

Popular banking app Chime is in the hot seat. As of May 2024, the Consumer Finance Protection Bureau (CFPB) filed an enforcement action against Chime for not paying customers promptly. The CFPB keeps banks from acting unfairly; the agency can fine banks for it.

Prior to 2021, Chime had a rule where it promised to give customers their deposits within 14 days of closing their Chime accounts. The CFPB has found evidence that Chime failed to pay thousands of customers within this time frame. Some customers had to take out loans to get by.

What that means: If you've closed a Chime account, you could be owed $150 or more. Here are the details, including who may qualify for $150, and how to get your money.

Who qualifies for $150 or more

If you closed your Chime account with a balance of $10 or more, and Chime took longer than 14 days to refund you your balance, Chime may owe you $150 or more. (That's the exact number specified in the CFPB enforcement order.)

The CFPB is forcing Chime to pay this because it took too long to pay customers who closed their checking and savings accounts. Some customers even had to take out loans to get by, which is a big no-no in fair banking practices.

How to get your money

According to the terms detailed in the CFPB filing, Chime will most likely send you the money via check to your current address after notifying you of next steps.

The details have yet to be totally hashed out. As outlined by the CFPB enforcement action, Chime has 60 days from the action to develop a detailed repayment plan and submit it to the CFPB. Details will include specific dates, including repayment dates.

Either way, there's nothing for you to do now to get your money. If that changes, Chime should contact you with details for how to claim your funds.

What happens next

Chime has agreed to settle with the CFPB. That means Chime will pay at least $1.3 million to customers who were harmed and put an additional $3.25 million penalty into the CFPB's victims relief fund.

More broadly speaking, the CFPB's enforcement action may spotlight actions by other fintechs. Suspects could include payment platforms Venmo and Cash App, neither of which are banks, but like Chime, they nevertheless offer banking features.

Fintech customers may want to look for emails notifying them that their fintech company owes them money. Where there's smoke, there's fire. If the CFPB can crack down on Chime, it can also crack down on similar bank-adjacent platforms.

Should you switch banks if you're with Chime?

Nobody likes it when their bank gets fined for mistreating customers. I bank with Chime, and I'm not exactly thrilled about the news. But is it a good enough reason to switch banks? Maybe if you dislike Chime generally. Otherwise, it's probably worth sticking around.

Chime isn't the first banking platform the CFPB has slapped fees on, and it won't be the last.

Many of the safest banks, including Chase and Wells Fargo, have been hit with fees at some point. The enforcement action against Chime is small potatoes. In 2022, the CFPB fined Wells Fargo a whopping $3.7 billion, much more than the $5 million Chime owes.

If Chime mistreated customers, that's bad, and customers deserve to be compensated. But CFPB action isn't uncommon, so it's worth taking a step back and seeing the bigger picture.

That said, you should absolutely switch banks if Chime has treated you poorly. The best banks offer low fees and high APYs. Chime is mostly fee-free, but its savings account interest rate could be better. Shop around online competitors like SoFi and Capital One for better rates.