Personal Finance

Don’t Have a Bank Account? Here’s How to Cash a Check

If you belong to one of the roughly 8.4 million American households without a bank account, according to the FDIC, you may be wondering how to cash a check. Unless you have a prepaid debit card, you may not have anywhere else to deposit the money, and if you prefer cash over other payment methods, getting access to the check funds may be a primary concern for you.

Cashing a check without a bank account is possible, but you may have to pay a fee to do it. And in some cases, you may have to do some extra legwork to make it happen. Here's what you need to know.

Where to Cash a Check Without a Bank Account

If you're looking to cash a check but don't have a checking or savings account of your own, here are your top options.

Cashing at the Check-Issuing Bank

Cashing a check at just any bank will be difficult because the bank won't know immediately whether the funds are actually available in the account of the person who wrote the check, or if it'll bounce.

If you visit a branch of the bank that issued the check, however, the bank teller can check the account it's drawn from to ensure the funds are available. The name of the bank should be listed on the check.

It's important to note that not all banks do this, and some may charge a fee. But if there are branches of the bank near you and they provide the service free of charge, this is your best option.

Cashing at a Retailer

Several grocery stores and other big-box retailers have begun to offer various money services through their customer service departments, including check cashing. Walmart, Kmart and Kroger stores are just a few examples.

Cashing a check this way will cost you money, and the fee can vary by retailer, so it's important to shop around. But depending on where you go, it's a much cheaper option than check-cashing stores and possibly even some issuing banks.

As one example, Kmart will cash payroll and government checks of up to $2,000 and personal checks of up to $500 for $1 or less, depending on where you live.

Check-Cashing Stores

A check-cashing store is a convenient way to get access to your funds, but it can also be the most expensive one. These stores may also provide other services, including payday loans, title loans and more.

Instead of charging a flat fee for cashing a check, though, many of them charge a percentage of the check, which can range from 1% to 4%. Some may even charge a flat fee on top of that rate. If you have a check in hand and need the cash in a hurry, consider these stores as a last resort rather than the go-to option.

How to Cash a Large Check Without a Bank Account

For most checks, you shouldn't have any problems using one of the options mentioned above. With large checks, however, the process can be a little more complicated.

For example, remember that Kmart limits payroll and government checks to $2,000, and Walmart will go as high as $5,000—though it does increase that limit to $7,500 from January through April, likely to accommodate tax refunds.

If you have a check that's larger than that, your best option is to work with the issuing bank, and you may need to wait to get access to the money. Also, remember that the bank may charge a fee.

What to Consider When Cashing a Check if You Don't Have a Bank Account

Getting a bank account of your own is one of the best things you can do to help with cashing checks. But if you're having a hard time qualifying for one, here are some things to think about when deciding where to go.

You May Be on the Hook for a Fee

In most cases, cashing a check using a retailer or check-cashing store will result in a fee, and some issuing banks may charge something as well. To limit how much you spend on check-cashing fees, research several check-cashing options to find the one that charges the least.

Start with the issuing bank, as they may provide the service without any cost at all. Then check with local retailers. Again, check-cashing stores are typically the most expensive option, so consider those only as a last resort.

You'll Need Some Form of ID

It's no surprise that any institution that offers check-cashing services will require at least one form of identification. They do this to ensure that you are the person who holds the rights to the check's funds.

In some cases, though, you may be required to provide two forms of identification, especially if you're trying to cash a large check. Acceptable forms of ID can vary, so call ahead to find out, but the following are common options:

  • Driver's license
  • State-issued ID
  • Military ID
  • U.S. passport
  • Mexico Matricula Consular ID
  • Tribal ID
  • Green card
  • Resident alien ID

Personal Checks Are Harder to Cash

If you're looking to cash a personal check, you'll have fewer options than with a payroll, government or other form of pre-printed check. Many check-cashing stores, for instance, won't cash personal checks at all, and retailers tend to have low limits of just a few hundred dollars.

As with any other type of check, start with the issuing bank, if possible. If the bank doesn't offer check-cashing services and it's a large check, consider asking the person to give you a money order or a cashier's check instead. These check types are pre-paid and are typically easier to cash than personal checks.

How to Get a Bank Account

To avoid the chance of paying check-cashing fees altogether, consider working to get a checking account of your own.

Check with your local banks and credit unions to find an account that's the best fit for you—preferably one with few fees. Also, consider checking with online banks, which may offer better savings rates and lower fees.

To qualify for a bank account, you'll typically need to provide some form of identification, proof of residence and cash for an initial deposit. Many banks and credit unions typically don't have a high minimum opening deposit requirement, so you don't have to worry about parting with too much cash upfront.

Of course, it's not easy for everyone to get approved for a bank account. If you have poor marks on your ChexSystems report, which tracks your history of usage with past bank accounts, it is possible to get denied.

In this case, some banks and credit unions offer what's called second-chance banking, which may come with some limitations but can help you get the services you need while you rebuild your banking history.

Always Seek the Lowest-Cost Option

It can be convenient to cash checks with retailers and check-cashing stores, but whether or not you do it regularly, it's worth taking a little extra time to find the lowest-cost option. In most cases, that's going to be getting a bank account of your own.

Opening a new bank account doesn't usually take long, especially if you fill out an application online. And while it can take a few days to get everything set up and receive checks of your own, it's worth it to have access to those services for free going forward.