Closing a Chime account does not directly impact your credit score because Chime is not a credit card account. Chime is a mobile banking platform that offers a spending account and a savings account, both of which are considered deposit accounts. Deposit accounts like these do not have any influence on your credit score because they do not involve borrowing money or extending credit.
However, it’s important to note that closing a credit card account can have an impact on your credit score. Credit cards are considered revolving credit accounts, and they play a significant role in determining your creditworthiness. When you close a credit card account, it can affect several factors that contribute to your credit score:
1. Credit utilization ratio: One of the key factors in calculating your credit score is your credit utilization ratio, which is the percentage of your available credit that you are using. Closing a credit card account reduces your total available credit, which can increase your credit utilization ratio if you have balances on other credit cards. A higher credit utilization ratio can negatively impact your credit score.
2. Length of credit history: The age of your credit accounts is another factor that affects your credit score. Closing an older credit card account can shorten your credit history, which may have a minor negative impact on your credit score.
3. Credit mix: Lenders like to see a mix of different types of credit accounts on your credit report, including credit cards, loans, and mortgages. By closing a credit card account, you may be reducing the diversity of your credit mix, which can have a small impact on your credit score.
It’s worth mentioning that the impact of closing a credit card account on your credit score is typically temporary. As long as you continue to use credit responsibly and maintain other active credit accounts, your credit score should recover over time.
Closing a Chime account, which is a deposit account, does not directly affect your credit score. However, closing a credit card account can have a temporary impact on your credit score, particularly in terms of your credit utilization ratio, length of credit history, and credit mix. It’s important to consider these factors before deciding to close a credit card account.