Walmart Offering Check Cashing Services

Walmart check cashing service offers a low cost way to cash a paycheck. But is it the best way to get paid? We give you several free alternatives.

Google the words “cashing checks.” Below the paid ads and a Google map of various check cashing locations in your area, you will find Walmart.com.

A one-stop shop where at some “supercenters” you might pull up to the automotive department, drop your car off for servicing, and get your complete list of to-do’s done. Need to pick up a gift? Grab a carton of milk? Cash a check to pay for this latest excursion? If you belong to one of the 9 million American households reported not to have a bank account, cashing your paycheck at Walmart might be your best option.

We’ll look at the pros and cons of Walmart’s check cashing service. We’ll also cover some important alternatives. First, let’s cover why some use check cashing stores.

Unbanked & Under-banked

According to the FDIC 2015 Survey of Unbanked and Underbanked Americans, 7%, or nine million, U.S. households were “unbanked.” As unbanked, not one person in the household had a checking or savings account.

The survey also found nearly 20 percent of U.S. households were “under-banked.” In this case, at least one person in the house had either a checking or savings account at an insured institution. But they still sought out services like check cashing elsewhere.

Walmart Check Cashing Services

Many Walmart locations around the country now have Money Center departments. This makes for great convenience. You can get your check cashed at the Money Center, and then use the cash for your shopping trip. With Walmart’s trend to become a one-stop shop for all household needs, each location is becoming its own small village.

The Walmart Money Centers are not full banks. They offer check cashing services, bill payments, outgoing wires, and reloadable debit cards. There are no checking accounts or savings accounts. Walmart abandoned earlier plans to become a bank. In doing so, is able to offer certain financial services while not being held to the same regulations as Chase, Bank of America, or your local bank branch.

On the spectrum of financial institutions, Walmart Money Centers are closer to establishments like payday loan companies and check cashing storefronts. These businesses charge high fees and cater to lower-income communities and the unbanked population.

Now back to the checking cashing service.

The Pros

While it might not be the ideal permanent solution, using Walmart’s Money Centers for your banking needs can be a better option than other check cashing services. The hours are convenient and the fees are low. Check cashing costs $3 for checks up to $1,000 and $6 for checks over $1,000, with a $5,000 cashing limit. It is worth noting from January to April, the cashing limit is increased to $7,500 to accommodate tax returns.

You may also be able to avoid long lines as Walmart offers customers the option to cash their checks at any open register. Their services are not just for paychecks. Customers may also cash government checks, tax checks, cashiers’ checks, insurance settlement checks, 401(k) retirement checks, and MoneyGram money orders purchased at Walmart.

The Cons

If you find yourself at Walmart with a pocket full of cash, you will have to exercise self-control. Cashing your paycheck at Walmart might tempt you to spend that money on impulse purchases. This could be an unwise decision if you are already struggling to save money or to keep up with your bills.

Walmart also does not cash personal checks. So what if you need to cash a personal check but don’t have a bank account? Your best bet is to go to the financial institution of the person who wrote the check.

You should know check cashing is not available at every Walmart location. To find one, visit the check cashing page of their website at Walmart.com.

The Financially Healthier Alternatives

Consider opening a bank account and using direct deposit for your paychecks. Even if you had a poor history with a financial institution in the past, it is worth speaking with someone at a bank. They may be able to offer you an account. Another option is to talk with your local credit union. Here are lists of the best checking accounts and savings accounts available today.

Another option is a prepaid debit card. Look for features including free direct deposit, free ATM access, and zero monthly fees. Walmart offers a BlueBird American Express prepaid debit card with those features. But the downside to that card is American Express is not accepted as widely as Visa or MasterCard.

Check cashing services are similar to fast food — inexpensive and convenient, but unhealthy in the long run. The best “food” for your financial health is a nest egg. With a bank account, you can store your hard-earned income, pay your bills without extra fees, and, most importantly, begin saving.

Originally published November 10, 2011, the Consumerism Commentary editorial team updated this post on October 10, 2017.