There are 4 main agencies that report to banks. Being listed negatively by any one or all 4 of these agencies is why a bank will deny an applicant while trying to open a new checking account.
If someone owes a bank money from overdrawing their bank account, or writing a bad check, and doesn't pay the bank back, that person's name will be referred to an agency that reports credit to banking institutions such as (Chexsystems, Telecheck, or SCAN). Depending on the situation the item could also be filed in that person's credit report.
The majority of the banks in the US will check an applicants name with Chexsystems upon applying for a new bank account.
Once someone's name is placed on Chexsystems, the name remains on the list for 5 years
Chexsystems is not required to remove a person's name from their database even after the past debt is paid.
Telecheck is another agency used by banks to check a persons past banking history. Some banks use information provided by Telecheck to make a judgment before letting a person open a new account.
Bad Credit :
Some banks use credit agencies such as Equifax to verify a person's credit before opening a bank account. Although over 90% of all banks in the US will use either Chexsystems or Telecheck to check the applicant's past banking history, there are still some that make their decision based on the applicant's credit.
Scan is another agency that reports to banks. SCAN (Shared Check Authorization Network) has been in business since 1984 and makes reports on people that have written bad checks. Some banks use information from SCAN to check a persons past banking history upon opening a new account.
What to do if you cant open a bank account?
There are a few banks and companies that offer a second chance checking account. These accounts often have limitations, and a monthly fee to participate. Depending on your are, second chance checking accounts may or may not be readily available. There are some online companies that offer second chance checking accounts to people regardless of their credit or Chexsystems, Telecheck, SCAN or credit status.
Jason Douglass has researched and written 100s of articles on the subject of finance/bad credit. Be on the lookout for more articles by this author on How to open a Second Chance Checking Account.