TLDR:
About 49 banks, credit unions, and neobanks currently offer early direct deposit, which allows customers to access money directly deposited into their accounts up to two business days in advance. This service is made possible by processing payments as soon as the bank receives information about the deposit, rather than waiting for the funds to clear. Customers who receive their paychecks early can have more flexibility in managing their finances and avoid late fees or overdraft fees. Eligibility criteria and fees for early direct deposit vary by bank.
Many people eagerly await payday, but wouldn’t it be great if the money came even a couple of days earlier? This is now possible with early direct deposit, a service offered by some banks that allows customers to access money directly deposited into their accounts up to two business days before their usual payday. CNN Underscored has compiled a list of 49 banks, credit unions, and neobanks that offer some form of early direct deposit to their customers.
Direct deposit is a type of electronic funds transfer that uses the Automated Clearing House (ACH) network to settle transactions between two parties. Banks can offer early direct deposit by making the funds available to a customer’s checking or savings account as soon as it receives information about the deposit, rather than waiting for the funds to clear. This is similar to a credit offered by the bank to give customers earlier access to their funds.
Receiving a paycheck two days early can be beneficial for financial planning as it provides more flexibility in managing expenses. It can help ensure bills are paid in full without overdrawing the account and incurring late or overdraft fees. Additionally, receiving the paycheck early can provide some extra cash for weekend plans or unexpected expenses. However, eligibility for early direct deposit varies by bank and may be restricted to certain types of accounts or require a minimum deposit threshold.
While early direct deposit can provide short-term financial relief, its impact on long-term financial planning may be minimal. The timing of when money is invested or put into a high-yield savings account, for example, may not significantly impact long-term savings goals. Additionally, early direct deposit is not guaranteed and depends on the prompt delivery of payroll information to the bank by employers.
Most banks and credit unions offer early direct deposit as a free service to their customers, while some may charge a fee or require customers to opt in to the service. The most common feature of early direct deposit is the ability to receive a paycheck up to two days early, although some banks may offer early access of one day. Some banks also offer the option to receive government benefits up to four days early. It is important to check with your bank to understand its specific early direct deposit features and associated fees.
