Banking and Finance

What is Direct Deposit? Everything You Should Know about Direct Deposit | Cheese Debit Card

Elizabeth
May 29, 2020

What is Direct Deposit?

82% of employees in the United States receive their paycheck via direct deposit. It’s easy to see why; setting up direct deposit is quick, easy, and often, if you’re banking with the right bank, allows you to access your hard-earned money even faster each payday.


But, what is direct deposit and how does direct deposit work? It’s super easy. It’s so easy that once we tell you how it works and how to set it up, you’ll feel silly for not doing it earlier. From making bill pay easier to reducing tons of hassle and fees, there are numerous benefits to setting up direct deposit. Here’s how it works so you can begin to enjoy those benefits.

How Does Direct Deposit Work?

What is Direct Deposit? Everything You Should Know about Direct Deposit | Cheese Debit Card

When you received a paycheck decades ago, you were paid in the form of a physical check. You then had to take that check to your bank’s local branch and deposit it. Chances are, the money wouldn’t show up in your account straight away, and you risked losing the check on the way to the bank or simply forgetting to deposit it.


A direct deposit is different. An employer or business will distribute the funds electronically to your checking or savings account, saving you the hassle of having to do, well, pretty much anything. And, you’re often able to set up direct deposit the other way around with other entities such as loan providers, tax collectors, and more.


We’ll go over how to set up a direct deposit in a bit. Still, it generally requires you to provide your bank account information, including your bank account number, routing number, and bank name, to your employer or whoever will pay you.


It sounds too good to be true, right? And too easy to be true? To explore more of the benefits of direct deposit, view our guide here.

Is Direct Deposit Better than Payday Loans?

The only drawback of a direct deposit is that they can sometimes take a while to complete. This means that even though your employer might deposit your paycheck directly into your account on the first of each month, it could take up to one to three days until you’re able to access that money. This depends on the bank that you have the direct deposit connected to. 


To recap: How long does a direct deposit take? It depends on your bank, but anywhere from one to three days.


This is why people often turn to payday loans instead of direct deposit as a way of accessing their cash faster. What is a payday loan? It’s a loan you take out on your paycheck before you receive it. Essentially, the business is verifying that you’ll eventually receive the money and fronting you the cash before it arrives. Earnin is a payday loan app, for example, that tracks when you go to and from work to log your hours. After logging your hours, they’ll pay you what you earn before your real paycheck even comes in.


Is direct deposit better than a payday loan? It depends on your financial situation and how often you find yourself in need of a payday loan. If you need to access your paycheck faster, we suggest switching banks. Some banks and companies (like Cheese!) allow you to access early deposit features, but we’ll get to that later.

How to Set Up Direct Deposit

Setting up a direct deposit varies from bank to bank and also depends on your employer. Usually, you’ll be given a direct deposit form by your employer during training (or you’ll have to ask for one). If they tell you they don’t have one, ask your bank for a direct deposit form. Here are links to some of the top bank’s direct deposit forms:



Once you have that form, you’ll have to fill in the following:

  • Your bank name
  • The bank’s mailing address
  • Your account number
  • Your routing number
  • The type of account that you wish to deposit the money into


It’s also likely that they’ll ask you to confirm the amount deposited weekly, bi-weekly, or monthly. Once you have all of that information filled out, you’ll submit the form and voila!

Cheese Debit Card with Early Deposit Features

If all of this talk of direct deposit has convinced you that you need to get in on a slice of the cheese too then, we’re here for you. At Cheese, you can not only enjoy $0 in fees and super savings (like 10% cashback at your favorite stores), but you can also set up a direct deposit easily straight to your account by giving your account info or the pre-filled form to your employer/payroll provider.


We’ll give you access to your money up to two days earlier than at a traditional bank. Plus, you’ll still get to reap the benefits of all our great other perks, such as:


❌ No Monthly Fee                                    🧀️ $5 cash bonus    

❌ No ATM Fee                                           🧀️ Up to 10% cashback with every purchase/transaction

❌ No Overdraft Fee                                   🧀️ Potential Double Cheese Cashback

❌ No Insufficient Fund Fee                       🧀️ Up to 3% Saving Bonus

❌ No Minimum Balance Requirement      🧀️ Early Paycheck

❌ No Int. Incoming Wire Transfer Fee      🔐 FDIC Insured


Ready to take control of your financial life? Sign up today for your Cheese Debit Card.


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How to Set Up Direct Deposit in Just 1 Min with Cheese?

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Cheese 银行卡 美国华人最好的选择
Cheese 银行卡 美国华人最好的选择