Your acquaintance is "unbanked," but needs money. There are several ways for you to assist.
With a bank account, it's quite simple to send money to friends and family, but what if the recipient doesn't have one?
A significant 25% of American families are unbanked or underbanked, according to a 2017 FDIC poll. This means that they either don't have bank accounts or use less conventional financial services, like payday loans and check cashing services.
Check out our simple how-to advice if you want to motivate someone to get a bank account
Here are the greatest low-cost methods for sending money to someone without a bank account in the interim.
1. payment order
Without a bank account, anyone can easily purchase a money order at a post office, grocery store, gas station, pharmacy, or large retailer like Walmart.
To send a money order, visit a merchant and buy one there for the desired amount using cash, a debit card, or a traveler's check. You'll need to fill out the money order and present identification. Simply give the money order to your receiver or mail it to them.
The quantity of money you can put into a money order and the number you can purchase every day may be regulated differently by different merchants.
Money orders can be cashed by the recipient at banks, credit unions, and a few retail locations. At the counter, they will have to present identification and sign the money order. If the recipient doesn't cash the money order at the bank that issued it or the post office, there can be a fine.
The costs that you and the receiver should budget for are listed below:
- Sender's fee: $1 to $2.
- A few dollars or a percentage of the transferred funds may be the recipient's cost in various circumstances.
- Sending cap: Typically, $700 for overseas transfers and $1,000 for money orders within the United States.
2. Walmart-to-Walmart
With the help of a mobile application or the Walmart2Walmart cash transfer program, customers can transmit money between Walmart stores. Transfers can be sent directly from your phone or at any Walmart location in the United States and Puerto Rico.
Present a photo ID at the customer service counter or money services area to begin an in-store transfer.
Pick the amount you want to send, the Walmart location where the recipient will pick it up, and then pay for the transfer with cash or a PIN-protected debit card. There will be a cost for the transfer.
The money will then be available for pickup at the designated Walmart location by your recipient. Walmart claims that the majority of transfers can be ready for pickup in only 10 minutes.
Fees and sending restrictions apply:
- $4.50 to $18 in cost to sender.
- No cost to the recipient.
- Sending cap: $2,500 daily, $6,000 monthly.
3. Prepaid debit cards
Prepaid debit cards are available from banks and other financial institutions. They function similarly to traditional bank cards, but you don't need a bank account to use one. Instead of sending cash, the sender loads money onto the recipient's card before handing it over.
Prepaid debit cards are available online, at big box stores, gas stations, and convenience stores.
Simply go to a website or physical facility and pay the desired amount with your credit, debit, or cash payment to set up a prepaid debit card.
Although some vendors offer the plastic card for free, you could need to spend a few bucks for it. Either you or the recipient of the card can reload it.
Prepaid debit cards function similarly to conventional debit cards and could offer benefits like cash back on purchases.
The following are the typical fees and balance restrictions:
- 0 to $5 in cost to sender.
- The recipient must pay a monthly or withdrawal charge.
- Maximum balance allowed: $2,501 to $20,000 approximately.
4. PayPal
One of the most popular and generally recognized digital payment options is PayPal.
Both the sender and the recipient must register for a free PayPal account with an email and phone number
Make sure your PayPal account is connected to a credit or debit card as the source of the monies you are sending before you send any money. Next, choose to transfer money to the receiver directly rather than to a company or service by providing the recipient's email address.
Complete the transfer by choosing the connected debit card as the source of funds. The funds should now appear in the recipient's PayPal account. Avoid using a linked credit card or a non-linked card to ensure the transfer is free.
The recipient must get into their PayPal account and ask for PayPal to mail them a check in order to receive the money. The cheque may take a week or two to arrive, after which most banks will cash it.
Following are PayPal's sending costs and restrictions:
- Sender fees: 0% (for domestic transfers) or 0.5% to 3.9% (for international transfers).
- No cost to the recipient.
- Up to $60,000 can be sent, with a $10,000 transaction cap possible.
5. Western Union
You can send or receive money with Western Union at more than 500,000 locations worldwide.
Transfers are simple to arrange online, via phone, or in person. The cash can be delivered immediately to the recipient's mobile wallet in some nations.
Western Union offers a variety of options for sending money to someone without a bank account, but the costs vary widely depending on the method you choose—cash, debit, credit, or a bank-to-bank transfer—as well as the state or country of destination, currency, local laws, ID requirements, and other factors.
The least expensive way to send money using Western Union is to arrange the transfer online, pay for it with cash at a WU store, and then arrange for the recipient to pick up the money at another WU station.
Sending in the US costs $5 for amounts under $50; expenses increase beyond that.
- Sender's cost: $5 to $49.99 and up (for transfers within the U.S.).
- No cost to the recipient.
- Up to $10,000 can be sent in a single transaction.
6. Venmo
financial services You can send money using the Venmo smartphone app. Both the sender and the recipient must register for free accounts using their respective phone numbers and email addresses.
You, the sender, can identify the source of the funds as a bank account, credit card, or debit card.
The recipient of the payment can ask for an actual Venmo card and load money right onto it. The card can then be used by the user much like a prepaid debit card.
Benefits of the Venmo card include tap-to-pay, cash-back benefits, and the opportunity to split expenses with pals who also use the service.
Sending cash through Venmo is cost-free if the funds come from the linked bank account, linked debit card, or your Venmo funds; however, using a credit card or non-linked debit card will cost you 3% more
Transfers take one business day, or you can request an immediate transfer for a cost of 1%.
- Anywhere between $0 and a 3% fee is the cost to the sender.
- No cost to the recipient.
- Sending range: $299.99 to $2,999.99 weekly with an ID that has been validated.
7. Facebook Messenger
Facebook users can now immediately pay money to one another within the United States via the social media site.
Simply connect a PayPal account or a debit card issued by a U.S. bank to your Facebook page to act as the sender. The recipient will then be able to receive your payment by linking a PayPal account to their profile.
Transfers out of your account happen instantly, but PayPal says it could take up to five business days for the recipient to get the money.
The recipient should next ask PayPal to mail the money to them as a check as a last step.
- Expense to sender: zero
- No cost to the recipient.
- Sending cap: not stated.
8. Google Pay
Google, the dominant search engine company, now provides a simple way to send money to friends and family in the United States via its Google Pay app.
The donor and recipient should each open a free Google Pay account, which comes with a Google Pay debit card, to get started.
The sender then needs to designate a major financial institution, PayPal account, or a debit or credit card from a bank with US banking license as the source of the funds. The recipient of the transfer must connect a PayPal account.
Open Google Pay and select the option to send money to complete the transfer. Choose your recipient, input the payment amount, and verify your payment method. All it takes is that.
When the recipient receives the money, he or she can either retain it in their Google Pay account or transfer it to the associated PayPal account and ask PayPal to issue them a check
Millions of physical and online merchants accept Google Pay as payment.
- Expense to sender: zero
- No cost to the recipient.
- Sending cap: $2,500 to a recipient without a bank account; otherwise, $10,000 per week.
Choosing how to deliver money
Sending money to family and friends who don't have bank accounts is now simpler than ever thanks to the internet and physical venues both domestically and abroad.
Consider your recipient's location, the amount you want to send, any transfer or cashing costs, and how quickly you need the money to arrive before selecting the transfer method that will work best for you.
Avoid being duped.
Although the companies on our list are reliable, you should be aware that other businesses (and some unscrupulous people) can try to deceive you into sending money.
You may protect yourself from being conned or hacked by taking the following precautions:
- Never transmit cash to a total stranger.
- Even if the emails appear to be from your financial institution or money transfer provider, never reply to unsolicited emails by sharing your personal information or passwords.
- Use providers that don't require an additional security measure when sending money directly from your email. If you solely use your email, you run the risk of being hacked.
- All money orders should be checked carefully by the recipients to ensure that nothing has been rubbed off or erased.
- Opt for services that need identification or leave a paper trail. The paper trail will allow you to take legal action if something goes wrong with the purchase.