If you close your Chime checking or savings account after January 1, 2018 and fail to retrieve your account balance within 14 days, your fintech company could owe you up to $150.
According to the Consumer Financial Protection Bureau, Chime customers waited more than three months to receive refunds after closing their accounts. The agency ordered San Francisco-based Chime to pay $3.25 million in penalties to the CFPB Victim Relief Fund and at least $1.3 million to affected customers, totaling more than $4.5 million.
“Chime customers are forced to wait weeks or months for access to their money and are forced to use alternative funds to cover necessary expenses,” CFPB Director Rohit Chopra said in a press release. It’s gone,” he said.
Here's what this violation means for you and what CNET Money experts want you to know.
What did Chime do wrong?
According to the CFPB, Chime was supposed to automatically refund funds by check to closed checking and savings accounts with a balance of $1 or more. However, Chime has thousands of instances where he was unable to refund the customer within 14 days and in some cases within 90 days.
“The majority of refund delays were due to third-party vendor misconfigurations from 2020 to 2021,” a Chime spokesperson said.
The CFPB noted that these delays could have caused significant financial hardship if someone needed the money in the account to pay for basic living expenses such as groceries or housing. For some, the only option may have been to resort to payday loans or carry a credit card balance, both of which can come with prohibitively high interest rates.
How much does Chime owe you?
If your balance is $10 or less and you do not receive a refund within 14 days of account closure, Chime will refund you $25. If your balance exceeds $10, your refund will be calculated at 30% per annum or $150 for the period from the refund deadline to the date you actually receive your refund.
Chime has 10 days to set up a $1.3 million fund to issue refunds, so expect to receive a letter from Chime in the mail if you're eligible.
If you closed your Chime checking or savings account and moved, and you think you may be eligible for a payment, contact Chime customer service at 844-244-6363 and provide your mailing address. We recommend updating. Within the next seven days, the company must publish a phone number, email, and postal address to, among other things, respond to questions about refunds.
Please note that Chime is not a bank. Instead, they partner with other banks to provide products and services. However, the account is held by one of his two affiliated banks insured by the Federal Deposit Insurance Corporation.
How to protect yourself from future banking problems
“To avoid risks like what happened with Chime, I highly recommend that you consider doing your emergency savings at a bank separate from your day-to-day banking,” says CPA, Certified Financial Education Instructor and Certified Financial Education Instructor. says financial education instructor Bola Sokunbi. She is a member of CNET Money's expert review panel.
You might also consider keeping some money on a preloaded or prepaid card so you can access your funds in case of a banking crisis or emergency, she adds.
If you haven't started saving for a contingency yet, start now. At Sokunbi, we recommend creating a line item in your budget to allocate money to your savings every time you get a paycheck. “Ideally, she would aim to save for at least three to six months of core or essential living expenses,” she said. This should include housing, transportation, major utilities, and medicines for you and your family.
Even small savings can help fill the gap if you experience temporary problems with your current bank. To be on the safe side, consider keeping this money in a separate high-yield savings account that earns interest and gives you easy access to your money.
