How to Cash a Check

It is estimated that nearly $14.5 billion in checks were processed in the United States in 2018.[1] While the use of checks has been steadily declining, they are still a widely used and accepted form of payment. Governments still issue checks for many of their services, including tax refunds or unemployment benefits payments. Businesses issuing one-time refunds or insurance companies issuing payments will usually do so with a check. People buying large items from the internet or off classifieds may still pay with a personal check.

With that, it is still important for individuals to understand how to turn their check to cash in the chance that they receive a payment in the form of a check.

Where can you cash a check

There are many places where you can turn your check into cash.

Bank – the easiest place for you to cash a check is to go to a bank where you are a client with. Having a checkings account with a bank will allow you to either deposit the monies into your account or have the bank provide you cash immediately. In some cases, the bank may have policies that require them to only cash part of the amount. The remaining would be available at a later date.

Check’s issuing bank – for those who may not have a bank account, you can always go to the check’s issuing bank to cash the check. By doing this, you maybe able to avoid having any of your monies held the bank.

Payday Loan and or Cash Advance Stores – there are many short-term lending businesses where you can cash your check. These businesses will typically charge a fee for doing so.

Prepaid Cards – for those without a bank account, some prepaid cards maybe the best alternative. Cards like the Walmart MoneyCard or GreenDot card allow for you to cash your check through a mobile app. This is a convenient alternative as it saves time with having to wait at the bank.

Grocery stores or mass retailers – certain grocery stores provide check cashing services. Walmart is a great example of a retailer that offers check cashing services. Their fees range from $4.00 to $8.00 depending on the amount of the check. Other grocery stores that offer check cashing services include Kroger, Publix, and Albertsons.

Steps for cashing a check

  1. Go to the bank with your check and valid government issued ID.
  2. Ask the teller if what the check cashing fees are and if there are any alternatives.
  3. Endorse the check by signing the back of the check with your name. s
  4. If necessary, fill out a deposit slip.
  5. Show the teller your ID for verification.
  6. Receive your cash.

How to avoid fraud

Check fraud and scams are common. Check writers may write a check full well knowing that they do not have all the funds in their account. Alternatively, the check itself may be illegitimate. Banks can refuse to cash your check if they suspect that the check is fraudulent.

The best way to avoid check fraud is to ask to, when possible, ask to be paid in other forms. This can be electronic transfer or cash. There are many apps available for transferring amounts between parties. Use these apps first before moving to a check option.

Another way to avoid check fraud is to ask the payer to obtain a money order. Money orders that are legitimate can be verified by the issuing bank. They are also as good as cash once it is issued. Money order scams, where the buyer pays with a fake money order, are also very common. Thus, ask for the money order to be issued by a reputable bank so that it can be verified.

Other Tips

Validate the written and dollar amount – banks can refuse to cash a check where there is a discrepancy between the two amounts.

Look at the check date to make sure that it is not more than 6 months old. Checks that are older than 6 months can be refused by the bank. The exception to this is government checks.

[1] The 2019 Federal Reserve Payments Study: Initial Data Release – https://www.federalreserve.gov/paymentsystems/fr-payments-study.htm, accessed June 29, 2020

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