With direct deposit, employers can put your paycheck straight into your bank account, which saves you time and lets you get paid faster.
While direct deposit typically takes anywhere between one and three days, you can get your money even faster by signing up with a bank that offers early direct deposit.
What Is Direct Deposit?
Direct deposit allows an employer to transfer funds directly into an employee’s checking or savings account to get paid faster, rather than cutting a paper check and giving it to the employee, who must then deposit it on their own. The direct deposit process is made possible by the automated clearing house (ACH) network, which enables electronic funds transfers between banks.
The main advantage of direct deposit is that it eliminates the need for a clearance period, so the account holder doesn’t have to wait for a check to clear. Paychecks make up the majority of direct deposit transfers, but other popular types of direct deposits include tax refunds, disability payments, and Social Security benefits.
How Banks Process Your Paycheck Early
Early direct deposit follows the same steps as a regular direct deposit with a minor change in the last step in the direct deposit process.
Because these processes are almost identical, you can get a good understanding of how early direct deposit works by first learning how regular direct deposit works. The direct deposit process involves the following five steps:
- Employee signs up for direct deposit – First, the employee must let their employer know they want to receive their paycheck through direct deposit. Most employers have a form for this, which they make available to employees during their onboarding process.
- Employer notifies bank – Next, the employer notifies its bank, which is called the Originating Depository Financial Institution (ODFI) that the employee is signing up for direct deposit. The employer must provide the ODFI with specific information, including the employee’s name, bank routing number, and the amount of the direct deposit.
- Employer’s bank forwards payment information to ACH – Once the ODFI has the direct deposit info, it forwards it to an ACH.
- ACH organizes payment instructions – The ACH ensures the payment instructions are correct. These sets of instructions are handled in bulk rather than individual transfers, which is why regular direct deposits typically take between one and three business days.
- Payment is processed – At this point, the employee’s bank has the payment instructions from the ACH and can process the direct deposit.
With early direct deposit, the employee’s bank eliminates the waiting period for processing by assuming the paycheck will be valid. This allows account holders to receive their money immediately rather than waiting for the regular one to three days.
Pros and Cons of Early Direct Deposit
Early direct deposit offers a number of benefits, but there are also a couple of drawbacks to be aware of. Before you sign up, it’s a good idea to get familiar with the pros and cons.
- Speed – In one consumer survey, researchers say people identified speed as the top reason for using direct deposit. If you need your money fast, you can’t beat the instant access early direct deposit offers.
- No risk of losing a paper check – Direct deposit eliminates the risk of losing a traditional paper check. You don’t have to worry about a check getting lost in the mail or your bag or car on the way to the bank.
- Some banks charge a fee – While it’s rare to find a bank that charges fees for direct deposit, some charge for early direct deposit. Typically, these fees are anywhere between $2 and $4 per paycheck deposit.
- Security risks – Because direct deposits are carried out entirely online, there is a risk of cybersecurity breaches. However, most banks have security measures in place to reduce this risk, and funds are protected by FDIC insurance.
How to Set Up Early Direct Deposit
If you want to enroll in early direct deposit, it’s generally fast and easy to get set up. You’ll need to find a bank that offers early direct deposit and then work with your employer to get enrolled.
1. Find a Bank That Offers Early Direct Deposit
Because you need a bank account before you can set up direct deposits, you’ll need to open your bank account first and then ask your employer for the direct deposit sign-up form. Your employer’s form will typically ask for your name, bank name, account and routing number, and other information like your address and contact info.
2. Complete Your Employer’s Direct Deposit Enrollment Form
Most employers have a form for setting up direct deposit, and you can use this same form to sign up for early direct deposit. You don’t need to do anything extra or different if you’re signing up for early direct deposit, as the “early” part of the process depends on your bank, not your employer.
Your employer’s form will typically ask for your name, bank name, account and routing number, and other information like your address and contact info.
19 Banks That Offer Early Direct Deposit
If you want to sign up for early direct deposit, the good news is you have a lot of banking options to choose from. Here are 19 banks that offer early direct deposit to their customers.
Chime allows you to receive your paycheck up to two days faster when you sign up for early direct deposit and has some great account features. As an added benefit, enrolling in Chime’s direct deposit program gets you automatic access to the bank’s other menu of services, including no overdraft fees on up to $100.
With Chime, you can set up early direct deposit directly from the Chime mobile app. Once you have a Chime account, enabling early direct deposit is as easy as a few clicks of a button.
#2. Axos Bank
Axos Bank offers an early direct deposit program called Direct Deposit Express that gives its customers access to their paychecks on payday, so there is no waiting around for your money. For other account features, Axos also boasts robust security and encryption, so customers can feel good knowing their funds are protected.
#3. Radius Bank
Radius Bank offers an early direct deposit program that allows customers to get their money right away. When you sign up for a Radius Bank checking account, you also receive no-fee access to ATMs around the world, plus above-average interest rates on your account.
Varo is an exclusively online bank that offers a checking account with no fees and no minimum balance required. Account holders can also sign up for early direct deposit to get paid up to two days early.
Other benefits of a Varo checking account include no monthly maintenance fees, no overdraft fees up to $50, and no fees on ATM withdrawals at 55,000 Allpoint ATMs.
Ando offers a checking account with no monthly service fees, no overdraft fees, and no minimum deposit when you open a new account. When you sign up for early direct deposit, you can also get access to your paycheck up to two days early.
On the downside, you can’t have a joint account with a spouse or partner, and there is a $2.95 fee per transaction when you use an ATM that is out of the Ando network.
#6. Andrews FCU
Andrews FCU is a credit union that offers a checking account with no monthly maintenance fees, overdraft protection when you link to a savings account or overdraft line of credit, and a $5 minimum deposit to open an account. When you enroll in early direct deposit, you can get your funds up to one day early.
The drawbacks include a $32 overdraft fee if you don’t sign up for overdraft protection, plus a $1 per-transaction ATM fee out of network.
With a Cheese account, you can get a checking account with no monthly service fees, competitive interest rates, no minimum opening deposit, cash back rewards, and no overdraft or out-of-network ATM fees. With these account features, Cheese also offers higher interest rates for 30 days if you refer others to the service.
#8. Current Premium
Current has two account levels, its Basic account and the Premium account. With the Basic account, you get a checking account with no overdraft fees and no minimum balance required. To get early direct deposit, however, you must sign up for the Premium account, which also comes with a Premium card that offers rewards points for fuel purchases.
However, there are a few drawbacks with the Current Premium account. There is a $2.50 per-transaction fee when you use an out-of-network ATM, there is no option for cash deposits, and the account comes with a $4.99 monthly service charge.
With GoBank, you can access your money up to two days early with a checking account. You can also get mobile check deposit and no overdraft charges.
The downsides include a number of service fees, however. In addition to a minimum opening deposit requirement ranging between $20 and $500, you’ll also pay $8.95 per month in service fees, $4.95 when you deposit cash at a retailer in the GoBank network, and a $3 ATM fee for using out of network.
#10. GTE Financial
GTE Financial is a credit union based in Florida, however it offers early direct deposit to customers in all 50 states. It also maintains a network of over 30,000 ATMs, which makes banking convenient for most customers regardless of their location.
While a GTE Financial checking account comes with many benefits, there are some drawbacks. For example, you’ll pay a $4.95 monthly service fee, and the early direct deposit program charges $3 per paycheck.
#11. One Account
With OneAccount, there is no minimum opening deposit required to open a checking account. OneAccount also offers above-average interest rates on its checking accounts, and there are no monthly fees or out-of-network ATM fees.
On the other hand, OneAccount limits the amount of interest you can earn depending on your account balance, and it charges interest on overdrafts if you maintain an overdraft balance for longer than a month.
#12. OneUnited Bank
OneUnited Bank offers customers early direct deposit on all of its checking accounts. It has physical locations in California, Florida, and Massachusetts, with online banking available to customers in all 50 states.
With a OneUnited Bank checking account, you can also make cash deposits at over 90,000 retailers, including Dollar General, Walmart, CVS, and Walgreens. However, the checking account comes with a $10 monthly service fee, a $15 fee each time you move funds to your overdraft protection account, and a $50 minimum deposit requirement to open an account.
Porte offers a checking account with no monthly service charges, mobile deposits, and no minimum opening deposit requirement. With early direct deposit, you can get your paycheck up to two days early.
However, Porte is online-only, so there are no physical branch locations. There is also a $20 fee each time you overdraft your account, plus a $2.50 per-transaction ATM fee when you use it out-of-network.
With a Wealthfront Cash Account, you can get your paycheck up to two days early. You also earn interest on your money, and you can open an account with a $1 opening deposit.
While there are no physical branch locations, Wealthfront offers a network of 19,000 ATMs, as well as the option to make purchases with Apple Pay and Google Pay. There are no monthly fees with a Wealthfront Cash Account.
Issued by Bancorp Bank, Card.com is a prepaid Visa card that gives you access to early direct deposit. To use your card, you must load it with cash in advance before making purchases at a participating retailer.
Card.com can be a good option for people with a bad banking history, as there are no credit checks or ChexSystems checks when you apply.
Offered as a partnership between American Express and Walmart, Bluebird is not actually a checking account. Instead, it’s a prepaid card that lets you pay bills and make purchases anywhere American Express is accepted.
If you need to pay bills or send money to someone, you can use your BlueBird card with a $4 fee per transaction. You can also get your paycheck up to two days early with direct deposit.
#17. Navy Federal
Navy Federal is a credit union open to former and active duty service members and their families. It has both physical locations and online banking and offers early direct deposit with no fees to its members.
#18. First Service Credit Union
First Service Credit Union offers customers access to their paycheck up to two days early. The credit union offers a number of checking accounts, including a free checking account, fresh start checking, high yield checking, and an account designed for teens.
#19. Green Dot
Green Dot is an online-only bank that gives customers access to their paycheck up to two days early with its ASAP Direct Deposit Program. If you receive government benefits, you can get them up to four days early by signing up for Green Dot’s early direct deposit program.
Signing up for early direct deposit makes good financial sense for most people, as it’s a fast and convenient way to get your paycheck earlier than you can with regular direct deposit. Before you enroll, however, it’s important to explore your options so you can find a bank that offers the best combination of value and services for your needs.