If you don’t have a bank account, you’re not alone. Just under 6 million households in the US are considered unbanked, which means they don’t have a checking or a savings account, according to research from the FDIC.
There are many reasons why a person might be unbanked, but a few common ones are a lack of trust in the banking industry, privacy concerns and not having enough money to afford a bank account.
If you don’t have a bank account, how can you cash a check? While no option is as convenient as having a checking account in your name, there are more ways than ever to cash a check without a bank account, thanks to evolving digital technologies.
How to cash a check without a bank account
1. Go to the issuing bank
In some cases, the bank that issued the check will also cash it for you — even if you aren’t a customer. Bank of America, for example, will cash some checks it issued. There’s a catch, though: You’ll pay $8 for every check you cash over $50. Regions Bank also offers a check-cashing service with even heftier fees — up to 4% of the check amount.
You might also be able to cash your check at a local community bank in your area. If one bank can’t help you, they may be able to direct you to another that can. But skip credit unions. The Federal Credit Union Act prohibits credit unions from cashing checks for nonmembers.
2. Visit a major retailer
Some grocery stores and retailers will cash your check for you, but it’s not free. At Walmart, you’ll pay $4 for a check of $1,000 or less and $8 for a check greater than $1,000. If you’re cashing a bigger check at Walmart, you’ll need to pick the right time on the calendar. The store usually limits check-cashing to checks $5,000 or less, but the limit jumps to $7,500 from January through April. If it’s a personal check — as in, not a pre-printed amount — your limit is much lower: $200.
Make sure you bring a government-issued ID like a driver’s license, and you’ll need to provide your Social Security number.
3. Use a payment app like PayPal or Venmo
Some banking alternatives offer check-cashing services. For example, Venmo allows most customers to snap a photo of the front and back of the check for easy deposit. (It’s not available for customers in New York.) If time is on your side, this is a good option. There’s no fee for the service if you’re willing to wait 10 days for the funds to clear.
PayPal offers a similar feature, and you’re much better off using this option if you can wait longer than 10 days for your money. Hand-signed checks come with a 5% fee if you need the money sooner than 10 days. That’s actually more expensive than some check-cashing stores, so try to avoid it.
4. Deposit it onto a prepaid debit card
Instead of turning the check into cash, you can also opt to load the funds onto a prepaid debit card. Typically, you’ll need to download the card issuer’s mobile app and follow the app’s instructions. These may include taking a photo of the front and back of the check and verifying the check amount.
The functionality and fee structure are basically identical to PayPal’s 5% for instant transfers on most checks if you’re not willing to wait for the money for 10 days. The best prepaid debit cards have relatively low fees, and once you register the account, these cards come with extra protections if someone manages to steal the number or the card — a key differentiator versus carrying around dollar bills. If someone steals your $20 bill, you’re out of luck.
5. Sign it over to someone else
You may not have a bank account, but hopefully, you do have a close friend or family member who’s willing to help you out so you can get the cash. Some banks allow you to endorse the check, followed by instructions to “pay to the order of” a new recipient — in this case, your trusted companion.
If this is the route you plan to take, you’ll likely need to go to the account holder’s bank with them in person. Hold off on signing over the check until you’re there, and be sure to bring your ID with you.
6. Consider a check-cashing store
There’s a reason check-cashing stores are last on this list: We recommend them only as a last resort. While every other option listed above includes a way to pay a flat fee or avoid fees altogether, there’s no escaping fees at check-cashing stores.
The fee structure is fairly complex too. In most cases, you’ll pay a different percentage of the amount depending on the type of check — with some stores charging more than 10% for certain types of personal checks.
How to open a bank account to make cashing checks easier
If you don’t have a bank account due to financial difficulties in the past, such as frequent overdrafts, you may be able to find a new solution to help manage your money. Some banks and credit unions offer second-chance checking accounts specifically designed for customers who have struggled in the past.
And if you don’t have a checking account because you have negative feelings about banks, start your search with the best banks for customer experience to find a place where you’ll feel a lot better about your experience.
FAQs
It depends on how large the check is and whether the issuing bank will help you cash it. Most retailers and services will cash checks of $5,000 or less. If it’s a larger amount, you may need to go to a check-cashing store or try signing the check over to someone else.
If the check is for less than $5,000, you can likely take care of it at major grocery or retail store like Walmart or Kroger. You could also set up an account with PayPal, Venmo or Ingo Money — all of which allow mobile deposits for checks that are $5,000 or less. For higher amounts, you’ll likely need to use a check-cashing service.
If you run a small business but don’t have a bank account, you should be prepared to show proof that you’re the owner of the business. That means gathering documents that show your business is incorporated or licensed via the state where you set it up, along with your personal ID. You’ll also want to find a business checking account to simplify your life and help set your business up for success.
It’s very hard to cash a check if you don’t have an ID or a bank account. If you’ve already created an online account with PayPal, Venmo or another financial services company, you may be able to log in to deposit the check using your already saved identification information. Alternatively, you can consider signing it over to someone you know who has an ID, but this route may prove to be a dead end — many banks require you to show your ID in person.
