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I replied to another comment further down but will say it here again - the stereotype of check cashing as a predatory industry is wrong, and it comes largely fr

I replied to another comment further down but will say it here again - the stereotype of check cashing as a predatory industry is wrong, and it comes largely from people who have never used a check cashing service and conflate it with payday lending, which is a totally different (and extremely predatory) service. For most poor people, checking cashing businesses are both cheaper and more transparent than any other way of getting their checks cashed. This has been studied - they would pay more (and in much less transparent fashion via a series of fees) if they went to actual banks. I recommend reading The Unbanking of America by Lisa Servon to get a real understanding of the industry.

standardUser 5y ago
I admit I'm combining payday loans and check cashing into one bucket (since it is one industry providing these different services), and although check cashing rates are much lower than payday loan rates, the average of 2-3% to simply cash a check is still egregious and to me, absolutely unacceptable.
- awillen 5y ago
  What is the one industry you're speaking of? Financial services? If so, how can you not include banks, which charge vastly more than the 2-3% that check cashing places do after all their fees are included? Sorry that it's not acceptable to you, but in most places check cashing places are the cheapest and best option for the people they serve. Should people be able to cash checks for free? Yes, I think they should, but that's not reality right now. It would be great if check cashing places could cash them well under 2-3% of the cost of the checks, but they're often small checks. These are businesses with rent to pay - they're not making insane profits despite what you may believe. If you put them all out of business because you think they're predatory, then you make all of the people they serve meaningfully worse off. It's fine to acknowledge that there's a problem with banking but not to call check cashing predatory while they're providing the cheapest, most user-friendly solution to that problem. 2-3% is egregious, but if you want to get rid of that you need to actually fix the structural problem, not just criticize companies that are often doing the best job they can given the constraints of a bad system.
  - standardUser 5y ago
    "...but in most places check cashing places are the cheapest and best option for the people they serve" Yes, this is one-hundred percent precisely the problem! Cashing a check for me costs $0.00 because I have a bank account. The unbanked do not have this luxury, yet they are in much greater need in keeping every penny than I am. The USPS offering a cheaper way to cash checks would be a vast improvement. That fixes the problem (but then again, so would legislation setting a max check cashing fee of $3.00 or something similar - moves like that were made to reign in ridiculous credit card fees and the world kept turning).
    - awillen 5y ago
      Yes, that is the problem, and yes, USPS banking would solve it. I haven't disagreed with either of those things. But here, again, you're talking about the check cashing industry, and to be blunt you have no idea what you're talking about. "so would legislation setting a max check cashing fee of $3.00 or something similar" - read this page carefully: https://www.walmart.com/cp/check-cashing/632047 https://www.walmart.com/cp/check-cashing/632047. Walmart's max fee for checks up to $1000 is $4. The problem is that a lot of people are cashing small checks - even if it only costs $2, somebody cashing a $50 check is still paying 4%. But what are check cashing places supposed to do? Charge pennies to cash small checks? They have fixed costs that aren't going to be covered by amounts that small. So yes, it is a problem that people can't cash checks for free. But that's not a problem with the check cashing industry, it's a problem with the financial system as a whole. You should read the book I recommended before you keep criticizing - you're just being a keyboard warrior who's never set foot inside a check cashing business criticizing something you don't understand. Here's an actual solution for you - the government requires all banks to cash all checks under a certain size, regardless of whether someone has an account at that bank. The government is then responsible for reimbursing any money lost to fraudulent checks (and prosecuting those who pass them).
      - coredog64 5y ago
        That last bit is a possibly huge unintended consequence. Crimes that would typically be a misdemeanor suddenly turn into federal charges when the USPS is involved. Would we see an increase in federal prosecutions for passing bad checks if postal banking is widespread?
- massysett 5y ago
  Cashing checks is risky. The customer might not be who he says he is. The check might be fraudulent or it might simply bounce. By its nature the business has to keep lots of cash on-site, which means armored trucks to move it in (or risky trips to the bank) and insurance (or just taking the risk.) And of course there's rent to pay, salaries, etc. Banks face these same risks but they have other things to make up for it: they've already identified their account holders and they have long-term relationships with them. They also have their account holders' money, and can simply seize it if the check has problems. Also, their customers do not actually cash most of the checks they deposit, so there's less need to move cash around. All of that aside, if you think the check-cashing fees are so egregious and unacceptable, it seems there is a business opportunity waiting for you. Apparently if you open your own check-cashing place that charges fair fees that are so much lower than 2-3%, the business will come rushing in yet you'll still be profitable in light of the egregiousness of 2-3%, so what are you waiting for?
  - standardUser 5y ago
    While I appreciate your brave defense of the status quo and how it harms poor people, I'd suggest you think outside of the box. There is no reason a check can't be verified almost instantly thanks to advances in technology, thereby reducing the risk to the check casher to zero. Perhaps regulations can allow exemptions for checks that cannot be verified. Or, better yet, the USPS can be used as this article discusses. But the idea that the current system is the best we can hope for is ludicrous.
    - kube-system 5y ago
      > There is no reason a check can't be verified almost instantly thanks to advances in technology, thereby reducing the risk to the check casher to zero. How? How do you determine that the document hasn’t been altered or forged? How do you determine that the person is who they say they are?
      - awillen 5y ago
        He doesn't actually understand what he's talking about - he just thinks he can hand-wave away structural problems of the financial system by shaking his fist at companies that he perceives to be the problem because he doesn't understand them.
- Aloha 5y ago
  If you're paid weekly and make 12 bucks an hour, your paycheck will be about 350 bucks after taxes. BofA charges $6 or $8 (sources vary) to cash a non-customer check drawn on them, paychecks might be waived, or might not be. Wells Fargo charges $7.50 again, paychecks might be waived, or might not be. Chase charges $6 or $8 (sources vary) again, paychecks might be waived, or might not be. Citibank is free for checks under $5000, Capital One is also free, SunTrust is free for Personal Checks, but $7 for business checks. US Bank is $5, again paychecks might be waived, or might not be. PNC Bank is a whopping $10, again paychecks might be waived, or might not be. This is on top of having to get to the bank during 'Bankers Hours' if you have a service job, or are working poor, thats a hard proposition sometimes. While I'm no fan of Payday lenders, their rates are usurious and prey on the poor, for the underbanked, they provide a vital service. I got lucky, even though I was in ChexSystems and couldn't open an account anywhere, I had an account with BofA so I could do banking. 2-3% plus a small service fee seems like a pretty good deal comparatively. It's a good impulse to want to crack down on these practices, but until you fix the supply side issues of making banking available to everyone, you're just hurting poor people. Thats the issue often these days, we target the symptoms of the problems in society without targeting any of the root causes, so we just end up squeezing the poor tighter and tighter. You can only ratchet up the misery so much before something gives.
  - throwaway0a5e 5y ago
    Walmart charges a small flat fee, 4/6/8 depending on amount and personal vs business check. If you already need to go to Walmart it's probably cheaper than making a separate trip to the bank.
    - Aloha 5y ago
      Agreed.
- dehrmann 5y ago
  > the average of 2-3% to simply cash a check is still egregious and to me That's roughly the same as an out-of-network ATM fee or a credit card transaction fee.

standardUser 5y ago

I admit I'm combining payday loans and check cashing into one bucket (since it is one industry providing these different services), and although check cashing rates are much lower than payday loan rates, the average of 2-3% to simply cash a check is still egregious and to me, absolutely unacceptable.

awillen 5y ago
What is the one industry you're speaking of? Financial services? If so, how can you not include banks, which charge vastly more than the 2-3% that check cashing places do after all their fees are included? Sorry that it's not acceptable to you, but in most places check cashing places are the cheapest and best option for the people they serve. Should people be able to cash checks for free? Yes, I think they should, but that's not reality right now. It would be great if check cashing places could cash them well under 2-3% of the cost of the checks, but they're often small checks. These are businesses with rent to pay - they're not making insane profits despite what you may believe. If you put them all out of business because you think they're predatory, then you make all of the people they serve meaningfully worse off. It's fine to acknowledge that there's a problem with banking but not to call check cashing predatory while they're providing the cheapest, most user-friendly solution to that problem. 2-3% is egregious, but if you want to get rid of that you need to actually fix the structural problem, not just criticize companies that are often doing the best job they can given the constraints of a bad system.
- standardUser 5y ago
  "...but in most places check cashing places are the cheapest and best option for the people they serve" Yes, this is one-hundred percent precisely the problem! Cashing a check for me costs $0.00 because I have a bank account. The unbanked do not have this luxury, yet they are in much greater need in keeping every penny than I am. The USPS offering a cheaper way to cash checks would be a vast improvement. That fixes the problem (but then again, so would legislation setting a max check cashing fee of $3.00 or something similar - moves like that were made to reign in ridiculous credit card fees and the world kept turning).
  - awillen 5y ago
    Yes, that is the problem, and yes, USPS banking would solve it. I haven't disagreed with either of those things. But here, again, you're talking about the check cashing industry, and to be blunt you have no idea what you're talking about. "so would legislation setting a max check cashing fee of $3.00 or something similar" - read this page carefully: https://www.walmart.com/cp/check-cashing/632047 https://www.walmart.com/cp/check-cashing/632047. Walmart's max fee for checks up to $1000 is $4. The problem is that a lot of people are cashing small checks - even if it only costs $2, somebody cashing a $50 check is still paying 4%. But what are check cashing places supposed to do? Charge pennies to cash small checks? They have fixed costs that aren't going to be covered by amounts that small. So yes, it is a problem that people can't cash checks for free. But that's not a problem with the check cashing industry, it's a problem with the financial system as a whole. You should read the book I recommended before you keep criticizing - you're just being a keyboard warrior who's never set foot inside a check cashing business criticizing something you don't understand. Here's an actual solution for you - the government requires all banks to cash all checks under a certain size, regardless of whether someone has an account at that bank. The government is then responsible for reimbursing any money lost to fraudulent checks (and prosecuting those who pass them).
    - coredog64 5y ago
      That last bit is a possibly huge unintended consequence. Crimes that would typically be a misdemeanor suddenly turn into federal charges when the USPS is involved. Would we see an increase in federal prosecutions for passing bad checks if postal banking is widespread?
massysett 5y ago
Cashing checks is risky. The customer might not be who he says he is. The check might be fraudulent or it might simply bounce. By its nature the business has to keep lots of cash on-site, which means armored trucks to move it in (or risky trips to the bank) and insurance (or just taking the risk.) And of course there's rent to pay, salaries, etc. Banks face these same risks but they have other things to make up for it: they've already identified their account holders and they have long-term relationships with them. They also have their account holders' money, and can simply seize it if the check has problems. Also, their customers do not actually cash most of the checks they deposit, so there's less need to move cash around. All of that aside, if you think the check-cashing fees are so egregious and unacceptable, it seems there is a business opportunity waiting for you. Apparently if you open your own check-cashing place that charges fair fees that are so much lower than 2-3%, the business will come rushing in yet you'll still be profitable in light of the egregiousness of 2-3%, so what are you waiting for?
- standardUser 5y ago
  While I appreciate your brave defense of the status quo and how it harms poor people, I'd suggest you think outside of the box. There is no reason a check can't be verified almost instantly thanks to advances in technology, thereby reducing the risk to the check casher to zero. Perhaps regulations can allow exemptions for checks that cannot be verified. Or, better yet, the USPS can be used as this article discusses. But the idea that the current system is the best we can hope for is ludicrous.
  - kube-system 5y ago
    > There is no reason a check can't be verified almost instantly thanks to advances in technology, thereby reducing the risk to the check casher to zero. How? How do you determine that the document hasn’t been altered or forged? How do you determine that the person is who they say they are?
    - awillen 5y ago
      He doesn't actually understand what he's talking about - he just thinks he can hand-wave away structural problems of the financial system by shaking his fist at companies that he perceives to be the problem because he doesn't understand them.
Aloha 5y ago
If you're paid weekly and make 12 bucks an hour, your paycheck will be about 350 bucks after taxes. BofA charges $6 or $8 (sources vary) to cash a non-customer check drawn on them, paychecks might be waived, or might not be. Wells Fargo charges $7.50 again, paychecks might be waived, or might not be. Chase charges $6 or $8 (sources vary) again, paychecks might be waived, or might not be. Citibank is free for checks under $5000, Capital One is also free, SunTrust is free for Personal Checks, but $7 for business checks. US Bank is $5, again paychecks might be waived, or might not be. PNC Bank is a whopping $10, again paychecks might be waived, or might not be. This is on top of having to get to the bank during 'Bankers Hours' if you have a service job, or are working poor, thats a hard proposition sometimes. While I'm no fan of Payday lenders, their rates are usurious and prey on the poor, for the underbanked, they provide a vital service. I got lucky, even though I was in ChexSystems and couldn't open an account anywhere, I had an account with BofA so I could do banking. 2-3% plus a small service fee seems like a pretty good deal comparatively. It's a good impulse to want to crack down on these practices, but until you fix the supply side issues of making banking available to everyone, you're just hurting poor people. Thats the issue often these days, we target the symptoms of the problems in society without targeting any of the root causes, so we just end up squeezing the poor tighter and tighter. You can only ratchet up the misery so much before something gives.
- throwaway0a5e 5y ago
  Walmart charges a small flat fee, 4/6/8 depending on amount and personal vs business check. If you already need to go to Walmart it's probably cheaper than making a separate trip to the bank.
  - Aloha 5y ago
    Agreed.
dehrmann 5y ago
> the average of 2-3% to simply cash a check is still egregious and to me That's roughly the same as an out-of-network ATM fee or a credit card transaction fee.