Have you ever received your paycheck late in the day only to discover your bank is already closed for the day or weekend? If so, you know how frustrating this can be, especially with so many places refusing to cash checks. Many stores such as Walmart are now cashing checks — as long as you keep within their check-cashing policy.
Here’s a quick look at how Walmart’s check cashing service works, along with its benefits and drawbacks.
What Type of Checks are Cashed?
Like many other stores that now cash checks, Walmart does have certain guidelines regarding the type of checks that can be cashed in their stores. Walmart will cash the following type of checks.
• Government checks
• Payroll checks
• Tax checks
• MoneyGram money orders
The highest check that Walmart will cash is $5,000. This high amount is very convenient for employees who get paid every two weeks or even once a month because there is less of a fee with one large check as opposed to a couple of smaller checks.
What About Fees?
Walmart has very low fees for their check-cashing service. If the check is under $1,000, the fee is $3. For checks over $1,000 and under $5,000, the fee is $6. In the state of Massachusetts, Walmart is the number one check-cashing establishment, and this is due to their low $3 check-cashing fees. Walmart’s Money Center offers various money management services designed to provide customers with convenience and bring customers into their stores. It’s a win-win situation for Walmart and customers.
How Do Walmart’s Check Cashing Fees Compare to Others?
Despite any fees the customer may be charged, cashing a check at Walmart may still be cheaper than at check-cashing stores or banks, according to U.S. News & World Report, because many of the other stores or banks charge not only a flat fee but also a percentage of the amount of the check. Imagine cashing a $2,000 check at a check-cashing store that charges a flat fee of $5 plus one percent of the check, which is quite common among these types of stores. The consumer would end up paying a total of $25 just to cash a check.
Adding these together can make it quite expensive just to cash a check and get your own money back. This is one reason why many consumers choose to cash their checks at stores like Walmart, particularly if they don’t have a checking account at a bank. Surprising as this may be, the FDIC reports that more than twenty-eight percent of U.S. households do not have bank accounts.
How is the Money Disbursed?
When you cash a check at Walmart, you have the choice of getting your money in cash or having it put on a Walmart MoneyCard. You can continue to use this money card each time you cash the check.
Although there is usually a $3 reload fee on Walmart’s money cards, this fee is waived if the money is coming from a check you just cashed at Walmart. When you initially purchase the money card, it will cost $3; however, you can purchase it online and eliminate the $3 fee.
Pros and Cons of Walmart’s Check Cashing Service
• Low Fees
• Convenient – checks can be cashed right at the register
• Cheaper than at other stores
• Requires only one stop if consumer was planning on stopping at Walmart anyway
• Does not require having an account
• Money can be disbursed in cash or put on a Walmart MoneyCard
• Even the low fee is higher than if the consumer cashed it at his or her own bank
• If the money is put on a Walmart MoneyCard, it must be spent at Walmart
• Consumers may make purchases they wouldn’t make if the check was cashed elsewhere
Bottom line: Despite the fees, Walmart’s check cashing service is still a much better deal than check cashing at other places such as check-cashing stores that also charge a percentage of the check cashed, and is a handy option for customers who don’t have checking accounts and would do most of their shopping at Walmart anyway.