In the world of digital banking, convenience is king. But as digital-only banks become more and more commonplace, challenger banks need to bring something more to the table beyond sophisticated technology and easy app interface. As a result, it can be challenging to ascertain which digital banks have the better perks, the lowest fees, and overall best design.
Among these contenders are two heavy-hitter online banks: Chime and Marcus. While both mobile banks certainly have their perks, below is an in-depth rundown where we compare and contrast features between Chime vs. Marcus to decipher which is the best digital bank. Before we dive into all the details, here’s our quick verdict:
Verdict: Marcus is better for individuals with a strong financial history. If you are juggling multiple loans and accounts, their consolidation loan option makes it easy to lower your loan payments, and their Marcus Insights make it easy to see your spending across accounts. If you’re building credit or are new to finances, Chime may be the option for you.
- No hidden fees
- Get paid up to 2-days early
- Credit Builder
- Automatically grow your savings
- Digital-only banking
- Fee-free overdraft
- Mobile payments
- Surplus of ATM locations
- No-penalty CD option
- 150 years in the financial business
- Unsecured loans up to $40,000
- Insights tool on mobile app
- No minimum deposit in savings account
- High-yield CDs
Chime and Marcus: The Basics
Chime is a financial technology and banking company with its chief goal of providing easy, free, and helpful banking services to those who need it. Their low fees and accessible credit accounts make Chime a standout digital bank option, especially for those hit with poor credit scores.
Chime is highly rated on consumer-based review websites like Consumer Affairs, and many people seem incredibly happy with their decision to bank with Chime.
Marcus Banking is an off-shoot of Goldman and Sachs. Created in 2016, it didn’t take long for Marcus to take the world by storm. Just four years later, Marcus Banking reported a whopping $96 billion in deposits in 2020. And it’s easy to see why. The powerhouse online bank offers high-yield savings accounts, high-yield certificates of deposit (C.D.s), and no-fee personal loans.
While Marcus keeps their line-up of features relatively lean compared to other online banks, the features they do offer are top-rated and highly successful. In fact, Forbes named them having one of the best online savings accounts and having some of the best CD rates. J.D. Power has recognized their loans as #1 in personal loan customer satisfaction in 2019.
With such accolades and high praise from customers, Marcus banking has carved itself as a top competitor in the world of digital banking.
Both Chime and Marcus boast significant features. With Chime, you benefit from various features such as:
- Convenient Banking App
With a digital bank, you know that you’re getting convenience at your fingertips. With Chime, you get much more. They have over 135,000+ five-star reviews in app stores based solely on their smart mobile app that features a simple, intuitive design.
Their app tracks account balances, daily transactions, and savings from anywhere with the Chime mobile app. Plus, you can send money to your friends and family using Pay Friends on the mobile banking app. See you later, Venmo and Paypal.
- Get Paid Early
Chime allows you to get paid early – up to two days before your direct deposit clears. Unlike with traditional banks, get your money faster and, as a result, get ahead of your bills and rent.
How do you set up direct deposit? Like with everything else with Chime, it’s easy and fast to set up direct deposit. When you open an account through Chime, you can email yourself a pre-filled direct deposit form that you can hand over to your employer. It should all just take a few short minutes to complete.
- Fee-Free Overdraft
Chime offers a fee-free overdraft with Spotme. While you may have to visit their website to understand if you are eligible, this is a fantastic tool that allows you to avoid pesky overdraft fees. If you’re a little bit in the red, Spotme will do exactly that: Spot you.
- Pay Friends
Whether your friends and family have the Chime app or not, they still get paid from you by you with no cash-out fees. They simply input their debit card number, and the money is wired directly into their account through a secure money transfer. The transfer is instant, and your friends and family will receive the money request within seconds.
Have paranoid friends? Ease their minds with deposits in Chime accounts that are FDIC insured through The Bancorp Bank or Stride Bank; Members FDIC.
With Marcus Bank, you also get features. They are:
- App With Intuitive Design
Track your financial goals and watch your financial progress in real-time when you use the Marcus App. Check your account balances, schedule transfers to and from other banks, make loan payments, and more with a simple click of a button.
Plus, their in-app alerts and notifications always keep you informed on your finances, so you always stay one step ahead of the curve.
- No Penalty CD
With No-Penalty CD, you get the power to earn a competitive fixed rate, plus the flexibility; if you need to, users can withdraw your entire balance beginning seven days after funding.
With only a minimum deposit of $500, Marcus guarantees great rates and a high rate of return. You also keep all of your earned interest, even if you withdraw early.
- Marcus Insights
Marcus Insights is a premier tool to improve your finances, and Marcus Bank allows any and all users to gain better financial literacy using their app, whether they have an account with Marcus Bank or not.
With Marcus Insights, you bring your financial accounts together into one platform, and the tool offers personalized insights to help you make empowered financial decisions. By compiling all the data into one easy-to-use, intuitive app, you can better understand how you spend, save, and invest.
Not only can you better see where your money is going, but since Goldman Sachs designs the app, their tools help you see your money spending habits much more clearly, enabling you to make stronger financial decisions.
With Chime, never worry about sneaky hidden fees. Chime offers accessible digital banking without monthly fees or open deposits. Not only that but applying for Chime is free. They do not require a deposit when you open an account, nor do they require a minimum balance once your account is up and running. There are no international transaction fees, and if you lose your debit card, the new one is free, too.
Marcus has a similar setup: they have no hidden fees and no minimum deposit in their savings account. Plus, they have zero early withdrawal penalties for their CD account.
As newer digital banks emerge, security is the most paramount feature. After all, what’s the point of storing your life savings to have it compromised by a few low-level hackers?
When it comes to comparing Chime vs. Marcus, both have formidable security features and are comparable in privacy, security, and safety.
Chime allows users to instantly block suspicious transaction behavior with a simple click on the app. When you turn on notifications, you receive alerts every time a transaction goes through, so you’re always one step ahead if a hacker places a fraudulent charge on your card.
Chime also secures your funds with FDIC. Through the Bancorp Bank or Stride Bank, N.A., Members FDIC, your account is insured up to $250,000. Additionally, since Chime uses a Visa card, your Visa account falls under the protection of Visa itself; Visa’s Zero-Liability Policy protects all unauthorized purchases.
On the other hand, Marcus Bank protects your information with multi-factor authentication, SSL encryption, the use of firewalls, and other safeguards. They only use the most secure browsers to access your account, and they monitor their networks around the clock with an elite security team.
Among the tools used to create a robust security system are:
- Encrypted Network
- Multi-factor Authentication
- And more. Click here for a full detailing of their security measures.
In the end, Chime does seem to have more protection and pays back your money under their protocol. In this sense, Chime Bank delivers a better security system than Marcus banking.
The most significant and most rewarding feature of the Chime Savings Account is its impressive ability to earn users .5% of APY (annual percentage yield) on their Savings Accounts, ten times higher than the national average. As if that’s not enough, there’s no limit or maximums on the interest earned.
Plus, Chime makes it easy to save. Their Save When You Spend feature rounds up every Chime debit card transaction to the nearest dollar and transfers it to your Savings Account, so you save by not even trying.
Additionally, Chime allows you to save when you get paid, too. Their Save When You Get Paid feature automatically transfers 10% of every direct deposit of $500 or more directly into your Savings Account. The two combined make for a powerful combination, which boosts your savings without you having to think about it consciously.
Marcus Bank, on the other hand, also boasts excellent savings features. Lauded by NerdWallet, GoBanking Rates, and more, Marcus also allows users to save with an equally impressive .50% APY rate.
There are no fees and no minimums to start your account, so you can start saving sooner than ever. Marcus also allows users to link to other bank accounts to enjoy both incoming and outgoing transfers. Speaking of transfers, you can make same-day transfers of $10,000 both to and from other banks.
Their high-yield savings account is FDIC insured, and customer service agents are available around the clock 24/7 to assist you with any concerns or issues regarding your account.
Opening a Marcus Savings account is easier than ever. Simply enter their website, input some personal information, transfer funds, and begin saving.
If you’re feeling a little skeptical of how much you can save, hop on over to their interest calculator to compare and contrast what interest you could be earning with Marcus Bank versus other popular banking choices like Bank of America, Chase, and Citibank. Chances are, you’ll be earning more interest with Marcus Bank.
Overall, Chime and Marcus are fairly comparable in terms of Saving Accounts. Both offer a high APY of .5%, and both accounts are secured and protected. If you’re looking for a bit of help building your savings, Chime has a couple of perks that make it easy to save.
Chime’s Spending Account is undoubtedly appealing. Chime sets itself above the competition with extraordinarily low rates with no monthly fees, minimum balance requirements, and no maintenance fees. And because they use Visa, their cards are accepted anywhere Visa’s are.
Just like you’re not limited with your Visa card, you’re also not limited by ATMs. Chime boasts that with your spending account, you have access to over 60,000 fee-free ATMs at stores you shop at, which is more than the three top national banks combined.
What stores, you ask? Walgreens, CVS, 7-Eleven all have fee-free ATMS when you use Chime. Need an ATM but don’t know where to start? Check out the map on your Chime app to find the nearest fee-free ATM by you.
Chime also makes it easy to pause your Spending Account anytime you lose or misplace your debit card. By going on the app, you can toggle a button to allow or disallow transactions on your card – no phone call necessary. Plus, their replacement debit cards are always free.
Currently, only Chime Bank offers a checking out (they call it a Spending Account). While Marcus has alluded to the idea of rolling out a checking account in the coming years, for now, they strictly offer savings accounts and financial tools to get your finances on track.
Because only Chime offers a Spending Account option, if that’s a feature that you are prioritizing, Chime Bank is the superior option.
Credit Accounts and Loans
What’s great about Chime is that they offer users the chance to build credit – even if they have poor credit to begin with. They do not do a credit check before allowing you a credit card. They also have no annual fee or interest and no minimum security deposit required.
Whether it’s gas or groceries, use Credit Builder for everyday purchases to help build credit with regular on-time payments.
For those who struggle with on-time payments, Turn on Safer Credit Building, and your balance will be automatically paid on time every month. Chime also keeps all the major credit bureaus updated, so if you have your Safer Credit Building feature turned on, you’re nearly guaranteed to improve your credit score gradually.
With Marcus Bank, users can opt for a personal loan instead of a credit card like with Chime. Their personal loan service, called MarcusPay, lets users pay a no-fee, fixed-rate installment loan.
MarcusPay has features such as:
- No deposit (Your first payment isn’t due until at least a month after your purchase)
- No fees (You pay for your purchase and interest over time. That’s it)
- Fixed Interest Rate
- Flexible Loan Options (ranging between 12 and 18-month loan terms available)
To apply for MarcusPay, you can see MarcusPay as a payment option when you’re ready to checkout with your purchase. You can use MarcusPay for an eligible purchase that costs between $750 and $10,000.
To be considered for MarcusPay, you must have a valid Social Security Number or Individual Tax ID Number, and you must be 18 or older. (If you live in Alabama, you must be at least 19, and if you live in Mississippi or Puerto Rico, you must be 21 or older).
Marcus Bank also offers users the ability to consolidate their existing loans, which can help users save money if they can get a lower interest rate on the debt and help simplify payments. Typically, users can merge multiple debts into one, commonly with a credit card balance transfer, home equity loan, or debt consolidation loan.
So, which bank provides better credit and loan service? The answer really depends on the individual and how you’re looking to improve your finances. If you’re looking for loan services, you would be better off choosing Marcus Bank to improve and consolidate your loans.
Alternatively, if you’re looking to build credit in a smaller and safer way, Chime offers their credit builder and credit card, which is nearly guaranteed to help you build your credit back up. This is an especially good option for those with poor credit history who may have difficulty getting approved for a credit card elsewhere.
All in all, when it comes to the Chime vs. Marcus debate, the two are fairly comparable in terms of their fee structure, their APY rates, their versatility in terms of loans, credit, and savings accounts.
However, Chime seems to be more geared towards the less financially strong individuals. If you’re new to building credit, you have poor credit, or you need help saving, Chime has the tools to put you back on the right track. If you’re a bit stronger in financial literacy, Marcus has the tools to help you navigate a more complicated financial situation.