What is a checkless debit card account?

What is a checkless debit card account? 

Checkless accounts are the same as your average checking account, except they have no paper checks and no possibility of overdrafts or overdraft fees. A checkless account may be an excellent option for older teens, young adults, or those with no/low credit.

With all of the different accounts, you might be stuck deciding between different banking options. Today we’re here to clear up any questions about one account type in particular – checkless debit card accounts.

Keep reading below to learn about the pros and cons of this account, who should open one, and how they work.

TFF22-060 - what is a checkless debit card account

This article may contain affiliate links which pay a commission and support this blog. Thank you for your support!

Conventional Checking vs Checkless Debit Card Accounts

To understand a checkless debit card account, you first need to know about conventional checking accounts.

Conventional Checking Account

A conventional checking account is one of the most common and basic bank accounts used in the U.S. These accounts give you a debit card that is connected to your checking account at a bank or credit union. These accounts will come with a pack of paper checks that are connected to the same account.

Conventional checking accounts may charge maintenance, overdraft, non-sufficient funds, and other fees. Some may also be linked to a savings account within that same bank, but the debit card will only pull funds from the checking account. Debit cards can be used at most ATMs, although out-of-network ATMs may also charge a fee for use.

Checkless Debit Card Account

A checkless debit card account is essentially the same as a conventional checking account, minus two things. First, the checkless account – as its name implies – does not come with paper checks. You can still pay most bills using Automated Clearing House (ACH) network transfers. ACH transfers connect different financial institutions to make payments and receive deposits between different banks and agencies.  

Second, checkless debit card accounts do not allow for overdrafts. With a conventional account, you might swipe your debit card for a purchase that is more than what you have in your account. Your payment would likely go through, but this would leave you “in the red” – also known as in the negatives – owing money to your bank and likely incurring an overdraft fee to make up for it.

On the other hand, checkless accounts do not let you use your account as credit. You will only be able to pay with the money you have in the account; if the purchase is higher, the transaction will be denied.

The Benefits of Checkless Debit Card Accounts

Checkless debit card accounts are great for those who want to avoid overdraft fees, avoid pesky paperwork, and enjoy mobile or online banking while still being FDIC-insured.

1. No Overdraft Fees           

The most prominent feature of checkless debit card accounts is the lack of overdraft fees. If you have never overdrawn your account, then this benefit may appeal to you. If, on the contrary, you have cringed at the costs of overdrawing in the past, checkless accounts could sound like a sigh of relief.

You’re typically charged an overdraft fee when you overdraw a conventional checking account. The average overdraft fee is around $35 per instance. While it sounds counterintuitive for a bank to charge you money for not having enough money in that account, banks make over $15 billion a year in these fees, so you can see how common they are.

You’ll likely need to transfer money from another account or deposit cash into your account to resolve an overdraft. If you have a checkless debit card account instead, you won’t need to worry about any of this.

Instead, when you try to make a purchase beyond your means, the purchase will be denied until you have the funds to complete it. This is a great way to keep your spending within your budget while avoiding paying fees and owing to your bank any money.

2. Eliminate Paperwork

Not too long ago, people would use checks daily to pay their bills, give gifts to friends and families, and even buy groceries at the store. Nowadays, bill-pay and all things financial have been streamlined into more efficient electronic processes.

The number of checks being written is dropping by over 1.8 billion per year. Add in debit cards, mobile payments, and cryptos to the mix and it’s easy to see how Americans now prefer to leave a paperless trail.

You can be more efficient in your purchases and transfers by not having checks. All of these transactions are still kept in a record online through your online banking, and you can always print them out if you prefer to have a hard copy on file.

3. Efficient Online Banking

Nowadays, even conventional accounts allow for online banking, but many checkless accounts offer more efficient online banking options.

Online banking institutions offer many checkless accounts, meaning they have few brick-and-mortar locations for customers to visit. These banks offer top-notch mobile banking options with all the bells and whistles to keep their customers satisfied.

4. FDIC-Insured

By opening a checkless debit card account, you don’t need to worry about losing your money in the case of a recession or if your bank or credit union goes bankrupt. The Federal Deposit Insurance Corporation (FDIC) is a U.S. government agency that protects depositors at insured financial institutions, including those with checkless accounts.

As with most conventional checking accounts, your checkless debit card account should also be FDIC-insured up to a set amount, guaranteeing that your money will be there for you when you need it.

The Downfalls of Checkless Debit Card Accounts

Checkless debit card accounts are fairly straightforward and useful for most people; however, they will not be the best account for you if you rely on checks. Additionally, not all checkless debit cards will make the cut for those looking for no-fee accounts.

1. No Checks

While most people can do without paper checks, you may still need them if you run your own business, want a form of digital-less payment, or prefer checks to money orders.

Businesses may still want to use checks because they provide a built-in delay between issuing the check and cashing it. This gives a nice buffer for businesses completing payroll or paying invoices.

Other people may simply prefer the paper trail that checks leave for their records, eliminating checkless accounts as an option. There is also a benefit of having checks if there is a power outage or an electronic issue with your computer system – it’s much harder to hack a checkbook than it is a debit card.

Certain organizations will require payment through only checks or money orders. We see this often with things like local, state, or federal applications sent by mail. If you’d rather not run to the local store to purchase a money order every time you do this, look for a conventional checking account instead of a checkless one.

2. Other Fees

If you aren’t careful, your checkless debit card account may come with its fair share of fees. These are similar to conventional checking account fees, such as monthly maintenance fees, non-sufficient funds (NSF) fees, ATM fees, paper statement fees, foreign transaction fees, and account closure fees.

Luckily, there is a way around them. Sign up for a checkless account with low or no fees. Many online banking options will offer this, alongside ATM fee reimbursements and no minimum balance requirements.

Who Should Open a Checkless Debit Card Account?

Checkless debit card accounts are useful, but they may not be the best bank account for everyone. These accounts are best for those with low credit scores, older teens and young adults, and those who tend to overdraft their accounts.

Some standard checking accounts will run a credit check on customers before approving their accounts. If you have poor or no credit, you may start with a checkless debit card account since it does not require a credit check.

Those who have experienced the pain of overdraft fees before may also enjoy how a checkless debit card account can help them stick with their budget and avoid overspending.

Overall, older teens and young adults ages 16-24 may benefit the most from a checkless debit card account. These individuals usually have nonexistent credit, have a higher chance of overdrawing their account due to lack of funds, and can take advantage of some checkless accounts that offer no fees for this age range, such as Fulton Bank.

Since some conventional checking accounts nowadays come with optional checkbooks, the average adult with a steady income may prefer a conventional account to a checkless one.

Buying Something with a Checkless Account

Purchasing items or paying bills with a checkless account can be done in a few ways.

Firstly, you can use your debit card as you would any debit card: 

  1. Head to a store that accepts debit/credit payments
  2. Tap or insert your card into the machine
  3. Add your PIN
  4. Complete your transaction. 

You can also opt to use your debit card to pull cash from an ATM and pay that way.

To pay your bills, you may have the option of paying with your debit card via mail or – the most popular way – you could set up ACH transfers with the billing company. This is usually done online or over the phone and can be set up to recur monthly, meaning it’s one less thing for you to worry about.

Do I Need Paper Checks?

Paper checks are still around, but the consensus is that they are on their way out. In fact, at the current rate, it’s predicted that paper checks will cease to be used by 2026.

More than 84% of U.S. households own a computer, meaning more and more people are digitalizing their finances every day,

Most businesses and utilities also prefer online and automatic payments, allowing money to move quickly and efficiently between customers and entities.

Electronic checks and transfers also offer a new level of encryption, which can help keep the money you’re sending secure.

Finally, the majority of people who use checks are over age 50. This means younger generations will soon take the lead in American employment and further push electronic payment systems.

Alternatives to Paper Checks

Instead of using paper checks, you can opt to use a debit or credit card, bank transfer, ACH transfer, digital wallet, cash, or money order.

Most people are used to using a debit/credit card or cash. Digital wallets are your debit or credit cards in a virtual form on the Apple Pay or Google Pay app on your phone.

ACH transfers are what we explained before, and bank transfers can come in the form of a wire transfer or Zelle. Zelle has been growing in popularity recently as a bank transfer app that is already built into most major online banking platforms. 

If a company requires payment and does not accept cards or cash, they may only accept checks or money orders. Money orders are another form of paper payment that you can purchase from certain retailers and banks.

For money orders, you pay the money upfront and either a paper or electronic money order will be created in the recipient’s name. You can then have this order sent to them directly or pass it to the recipient yourself. Money orders are very similar to checks, although they can be digital and are often used for international payments.

Final Thoughts

Checkless debit card accounts are similar to conventional checking accounts, but with two distinctions; they do not come with paper checks, and they do not allow or charge for overdrafts.

These accounts are great for those with low or no credit or people who tend to overdraft their accounts, such as older teens and young adults. With checks on their way out and digital banking on its way in, you may want to consider a checkless debit card account.


Based on this article, we think you’ll enjoy the following:

John is the founder of TightFist Finance and an expert in the field of personal finance. John has studied personal finance for over 10 years and has used his knowledge to pay down debt, grow his investment portfolio, and launch a financial based business. He is committed to sharing content related to personal finance based on his experience in his career, investing, and path towards reaching financial independence.