Early Direct Deposit [2024]

Technically, the number of banks in the U.S. is shrinking – down to 4,136. 

But that doesn’t mean banking customers are suddenly low on options. In fact, the rise of digital banking has brought exciting new benefits to the industry.

Early direct deposit is one of them.

With early direct deposit, you can receive paychecks, tax refunds, and government benefits up to two days early. That lets you meet your financial obligations or start earning interest ahead of time.

Intrigued? You probably should be! Keep reading to learn more about the wonders of early direct deposit. 

What is Early Direct Deposit?

Early direct deposit is a way to receive paychecks and other deposits up to two days early. So, if you normally receive your paycheck on a Friday, the funds could potentially appear in your bank account as early as Wednesday. 

People typically associate early direct deposit with paychecks, but you can also use it for other types of payments. 

Banks might offer early direct deposit with:

• Paychecks
• Tax refunds
• Government benefits (including social security)
• Pensions

Keep in mind that not all bank accounts offer early direct deposit. If this is a service you think you’d appreciate, start by seeing if your current bank offers it. And if not, try looking for an account that does!

It’s also worth noting that early direct deposit is a relatively recent offering stemming from the rise in online banking. 

For most of recent history, people had to wait for “payday” for their earnings to appear. Then, some online-only “neobanks” started offering “early paydays,” which they were able to do by making money available in people’s accounts before the funds technically cleared. 

Nowadays, traditional banks like Chase and Wells Fargo are also offering early direct deposit. It seems that the trend will only continue – so if your bank doesn’t offer it yet, changes could be right around the corner!

And no matter your financial situation, it could be worth trying to get early direct deposit as soon as possible. 

If you’re living paycheck to paycheck, accessing funds earlier can help pay the bills and alleviate the anxiety of acute economic hardship. If you’re not living paycheck to paycheck, you can put the money into an interest-earning account. The earlier the money gets there, the more you’ll end up earning!

How Does Early Direct Deposit Work?

Early direct deposit works by giving the customer their money as soon as the payor submits the payment details and without waiting for the funds to clear.

To understand exactly what’s going on here, it’s important to know how direct deposit typically functions. 

With direct deposit, money is sent directly to your bank account without you having to do anything. It’s meant to be more convenient than the old-fashioned model, where you’d get a physical paycheck that you’d then have to deposit at the bank.

Direct deposits are sent over the automated clearing house network, often called the ACH. The ACH is a government program run by the Bureau of the Fiscal Service that facilitates electronic payments. It’s totally trustworthy, and it’s revolutionized the way money circulates in the American economy. 

So, let’s say you have “standard” direct deposit (as opposed to “early” direct deposit). The process goes like this:

1. The payor (usually your employer or the government) submits the deposit information to the bank.
2. The money remains unavailable while the bank waits for the funds to clear.
3. The funds clear, and the money appears in your bank account. This is what most people consider “payday.”

That’s the standard process – but how is early direct deposit different?

The magic of early direct deposit is that it eliminates the second step. Once the bank sees that the payor has submitted a deposit, it simply puts the money in your bank account right away – not worrying about the fact that the funds haven’t cleared. That’s how you’re able to access your money before your standard payday. 

There’s no set time when early direct deposits become available. For paychecks, it depends on how your employer processes payroll. You could get your money at the same time every week, or it could vary. 

That’s why banks say you’ll get paid “up to” two days early. They can’t promise an exact time, because it’s not on them to start to process. 

How to Set Up Early Direct Deposit?

Setting up early direct deposit is usually super easy. In fact, you can likely do it in just three steps. 

1. Find an account that offers early direct deposit. Lots of banks offer this perk, but not all. There are also finance apps and payment services with early direct deposit, including PayPal, Cash App, and Chime.

2. Open an account. With most online banks and digital finance platforms, opening an account is simple. You’ll just have to provide some basic information online. If you already have an account with a bank or platform that offers early direct deposit, you can skip this step.

3. Set up direct deposit. This is something you’ll set up with the payor – either your employer or the government agency responsible for sending you payments. Most banks and platforms will give you a direct deposit form that you can fill out and then send to whoever’s in charge of payroll at your employer. This form will include your account number and the routing number for your bank or financial institution. 

Once you’ve set up direct deposit, you shouldn’t have to do anything else. As long as the account offers early direct deposits, your payments should automatically start arriving ahead of schedule.

Pros and Cons of Early Direct Deposit

Early direct deposit is generally considered a win-win. I mean, who doesn’t appreciate getting money ahead of time? 

That said, there are a few complications to consider whenever you change your financial routine. 

Here are the pros and cons of early direct deposit. 

Pros

• You can pay your bills earlier. This could help you avoid late fees and stay on top of your regular expenses.
• You can use the money for essential daily purchases. Not only can this make life less stressful, but you could also avoid overdrawing your checking account. This could also save you some serious money in fees.
• You can start earning interest on the money earlier. Any financial advisor could tell you that it’s always better to receive money as soon as possible – because, even if you don’t spend it, you can put it into an account where it will earn interest. 
• It’s free – and totally responsible! There are other ways to access money early, including payday loans and overdrawing your checking account, but they can be costly and terrible for your financial health. Early direct deposit is a safe, free alternative.
• Setting up direct deposit can qualify you for other perks. With some bank accounts (like with Chime or Upgrade), setting up direct deposits will get you overdraft protection or cash back on debit card purchases. 

Cons

• Your paychecks could come at different times each week. The exact timing of early direct deposit depends on the payor’s system, so you’ll have to get used to a bit of unpredictability. 
• You might have to tweak your budget. A new payday could throw your standard spending habits out of whack, so make sure you take the time to plan out a new routine. 

Commonly Asked Questions About Early Direct Deposit

What Banks Give Direct Deposit Early / What Banks Offer Early Direct Deposit?

Here are some banks and personal finance platforms that offer early direct deposit:

• SoFi
• PayPal
• Varo
• Upgrade (read full Upgrade Bank review here)
• Chime
• Current (read full Current Bank review here)
• Revolut (read full Revolut review here)
• Cash App

And to learn which budgeting app could best help you manage your finances and boost your savings, check out these comparisons of Rocket Money vs the competition:

• Rocket Money vs YNAB
• Rocket Money vs Simplifi
• Rocket Money vs Copilot

Then use a net worth tracker to see how your new financial strategies are paying off. 

What Time Does Early Direct Deposit Hit?

Early direct deposit can hit at pretty much any time. The timing isn’t dependent on the bank, but on how the “payor” (the people sending the payment) handles the process. That said, early direct deposits often arrive two days early. 

Is it Possible to Get Direct Deposit Early? 

Many banks and banking platforms offer early direct deposits. Just find an account that offers it, then set up direct deposit like you normally would. You could get paychecks, tax refunds, and government benefits up to two days early. 

And if you’d like a bank that will help you boost your balance fast, check out these banks with immediate sign-up bonus.

Does Bank of America Offer 2 Day Early Direct Deposit? 

As of now, Bank of America doesn’t offer early direct deposit. But keep in mind that “early direct deposit” is a pretty new phenomenon, so they may start offering it soon. 

Early Direct Deposit Chase?

Chase offers early direct deposit with its Chase Secure Banking accounts. And don’t worry – there’s no complicated setup process. Just set up direct deposits with your employer, and your paychecks will automatically arrive up to two days early. 

Early Direct Deposit Banks?

These banks and platforms can deliver direct deposits up to two days early:

• SoFi
• PayPal
• Cash App
• Revolut (read full Revolut review here)
• Varo
• Upgrade (read full Upgrade Bank review here)
• Chime
• Current (read full Current Bank review here)