The decision of whether to cash or deposit a check can affect how quickly you receive your funds.
When you cash a check, you get cash in your hands. You walk away with the entire payment and are free to spend it right away. However, it is not always simple (or free).
Depositing a check means depositing it into your bank or credit union account. You won’t have to worry about losing the money because you’ll be putting it somewhere safe. The bank may allow you to withdraw some (or all) of the check amount, but you may have to wait a few days before you have access to it all.
You don’t have to wait if you just want to deposit the check so that your bank can begin processing the payment as soon as possible. Most banks and credit unions allow you to deposit checks using your mobile device at any time of day or night, so you could deposit your check from your couch in the middle of the night if you wanted to.
If you need the money right away, cash the check, but be aware that it may require a little more effort, particularly if you don’t have a bank account.
The type of check you’re attempting to cash is important. Banks are only required to make the first $200 or so of a personal or commercial check available to you within one business day. 1 Bank may treat government-issued checks differently—you’ll typically have access to 100% of the cash one business day after the banking day. 2
Other checks, such as cashier’s checks, payroll checks from local employers, and payments from insurance companies, may also qualify depending on your bank’s policies.
If you can’t cash a check for its full face value, you might have to deposit it. In this case, the speed with which you can access the cash is determined by the type of deposit you make. If you need the funds quickly, make a deposit in-person to a bank employee. You can also use a check cashing ATM or your mobile device to deposit it, but those methods may have longer bank hold times.
The underserved market in the United States is sizable. According to the Federal Reserve, 22 percent of all American adults are unbanked or underbanked, and many rely on services such as payday loans, money orders, and pawnshop loans to get by. The pandemic has only made access to financial services such as bill payments, loans, money transfers, and other services more difficult for this demographic.
It’s not like check-cashing is a brand-new concept. Check cashing ATMs have been around for a while, but not without a string of mishaps. People are progressing and making things and services as convenient as possible through innovation. For example, the ongoing TECH revolution will only make things more accessible to a wider range of people. Historically, the underserved relied on ATMs to obtain cash, but companies are now expanding ATM services to include a variety of tools for them. Smart ATM platform that offers unbanked and underbanked people check cashing, money transfers, real-time bill payment, cell phone reloads, micro-loans, and bitcoin. Isn’t it incredible?
These check cashing ATMs are part of a social initiative that provides financial services infrastructure to underserved communities in the United States and around the world. These offer quick, convenient, and low-cost financial services, as well as a self-service kiosk where people can cash checks.
Check Cashing at ATMs is a little more complicated than going to a bank, but you can also cash a check at an ATM. However, not every ATM will provide this option; some will only allow you to deposit the check, while others will not accept check deposits at all.
However, if your ATM allows it, simply bring your check, bank card, and a pen (to endorse the check) to the machine and follow the prompts on the screen. Before the ATM will dispense your cash, you may need to have the amount already available in your account.
All check-cashing alternatives pose greater personal and financial risks because checks and cash can be lost or stolen.
Some banks offer second-chance checking accounts to those who do not qualify for a standard checking account. Customers can use these accounts to demonstrate their ability to manage a checking account responsibly, allowing them to eventually qualify for and enjoy the benefits of standard bank accounts. A checking account at a bank or credit union is still the most secure, convenient, and cost-effective way to cash checks.