If you‘ve ever been paid with a check from a foreign country, you know that accessing those funds can be an ordeal. While the rise of electronic payments has made international transactions easier than ever, old-fashioned paper checks are still widely used in some parts of the world. In fact, the World Bank estimates that over $689 billion in remittances were sent globally in 2018, much of it via checks.
As a retail and consumer expert, I‘ve seen countless people run into roadblocks when trying to cash an international check in the U.S. One of the most common questions I hear is, "Can I just take it to Walmart?" After all, Walmart is known for its extensive financial services, including check cashing. Unfortunately, the answer is usually no – and there are good reasons why. In this article, I‘ll break down Walmart‘s policy on international checks and share some better solutions for getting your money safely.
Walmart‘s Check Cashing Policy Explained
First, let‘s review what types of checks the Walmart MoneyCenter does and doesn‘t accept. Walmart can cash most pre-printed checks, including:
- Payroll checks
- Government checks
- Tax refund checks
- Cashier‘s checks
- Insurance settlement checks
- 401(k) or other retirement distribution checks
- MoneyGram money orders
- Two-party personal checks (with some restrictions)
However, there are several important limitations to Walmart‘s check cashing services:
- Checks must be issued by a U.S. bank and payable in U.S. dollars
- Checks cannot be handwritten or starter checks
- Check must be dated within 180 days
- Maximum check amount is $5,000 ($7,500 from January to April)
- You must present a valid, government-issued photo ID
- For checks over $3,000, you must also provide your Social Security Number or Individual Taxpayer Identification Number
Most importantly for our purposes, Walmart cannot cash checks drawn on banks outside the United States. Even if the amount is small, Walmart will not accept checks from foreign banks or checks in foreign currencies. The only exception is for some Canadian checks (more on that later).
These restrictions may seem inconvenient, but they help Walmart manage the risks associated with international checks. According to a survey by the Federal Reserve Bank, over 60% of companies that receive international checks report experiencing attempted or actual fraud. By only accepting U.S.-based checks, Walmart can verify them more quickly and avoid losses from returned or forged international checks.
The Challenge of Processing International Checks
So why is cashing a foreign check such a hassle, even for major banks? The main issue is the time and costs involved in clearing checks from banks in other countries. While domestic checks can often be verified and paid out within a day or two, international checks may take several weeks to fully clear.
Here‘s a simplified version of how the process typically works:
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The check is deposited at a U.S. bank and provisional credit is issued to the customer‘s account.
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The U.S. bank mails the physical check to the foreign bank that issued it.
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The foreign bank receives the check and confirms that the account has sufficient funds to cover it.
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The foreign bank transfers the funds (minus any fees) to the U.S. bank.
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The U.S. bank converts the funds to U.S. dollars and posts the final credit to the customer‘s account.
As you can imagine, each of these steps takes time – and time is money in the banking world. The longer the check takes to clear, the greater the risk that it could be returned for insufficient funds or fraud. In addition, the U.S. bank has to bear the costs of currency conversion and international transaction fees. These costs are often passed on to customers in the form of lengthy hold times and high fees for depositing international checks.
According to data from the Federal Reserve, the average fee for processing a foreign check is $20, with some banks charging as much as $75. These fees can eat into your funds quickly, especially for smaller check amounts. And if the check ends up being returned unpaid after several weeks, you may be on the hook to repay your bank for any money you‘ve already withdrawn.
Special Cases: Cashing Canadian Checks
Earlier, I mentioned that Walmart makes an exception to its no-international-checks policy for some Canadian checks. Walmart will cash a personal or business check from Canada, but only if it meets two specific criteria:
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The check must be drawn on a bank that has branches in both the U.S. and Canada, such as TD Bank or Royal Bank of Canada (RBC).
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The check must be payable in U.S. dollars, not Canadian dollars.
This policy allows Walmart to cash checks for Canadian customers visiting the U.S. or Americans doing business with Canadian companies. However, the check must go through a bank with a U.S. presence, which speeds up the clearing process and reduces the risk of fraud.
If your Canadian check doesn‘t meet these requirements, Walmart still can‘t accept it – you‘ll need to deposit it at a bank instead. Some U.S. banks have special arrangements with Canadian banks that allow them to clear checks more quickly, but you should still expect a hold of several days to a few weeks.
Alternatives to Cashing Foreign Checks
If you‘ve received an international check, cashing it may not be your best option. Instead, consider one of these alternatives:
Deposit the Check at Your Bank
The safest way to access funds from a foreign check is usually to deposit it in your bank account and wait for it to clear. While you may face long hold times and fees, you‘re less likely to lose money than if you use a check cashing service. Some tips for depositing international checks:
- Ask your bank about their policies and fees upfront so you know what to expect.
- Provide as much information as possible about the check issuer to help your bank verify it.
- Don‘t write checks or make withdrawals against the deposited funds until you‘re certain the check has fully cleared.
- Be wary of any checks that are for more than the expected amount or that arrive unexpectedly.
Use an International Money Transfer Service
For faster and more secure payments, consider asking the sender to use a money transfer service like Western Union or MoneyGram instead of a check. With these services, the funds are transferred electronically and can often be picked up in cash within minutes. Fees vary based on the amount and location, but are often lower than the costs of cashing a check.
Another increasingly popular option is TransferWise, which offers international transfers at the real exchange rate with no hidden fees. With TransferWise, you can receive payments directly in your bank account in over 60 countries.
Try an Online Payment Processor
If you frequently receive international business payments, look into online platforms like PayPal, Stripe, or Payoneer. These processors allow clients to pay you electronically via bank transfer or credit card, with generally lower fees than traditional wire transfers or check processing. Some also offer additional perks like invoicing tools and fraud protection.
Avoiding International Check Scams
Unfortunately, international checks are a common tool for scammers looking to steal money or personal information. One of the most prevalent scams involves a fraudster sending a victim a check for more than the agreed-upon amount and asking them to wire back the overage. By the time the check bounces, the victim has already sent real money to the scammer.
Other red flags of potential international check fraud include:
- Checks that arrive unexpectedly or from unknown individuals
- Pressure to deposit the check quickly or wire money to a third party
- Checks with suspicious-looking details like misspelled company names or poor print quality
- Winning a prize or inheritance that requires you to pay a fee by check first
If you suspect that an international check may be fraudulent, do not deposit it or send any money to the issuer. Instead, report the scam to the Federal Trade Commission (FTC) or the U.S. Postal Inspection Service.
The Bottom Line
While it may be disappointing to learn that Walmart can‘t cash your international check, they‘re far from alone in this policy. Most U.S. retailers and check cashers simply aren‘t equipped to handle the complexities and risks of foreign checks. Your best bet is usually to deposit the check at your bank or credit union and wait patiently for it to clear.
Better yet, consider switching to a more modern international payment method like a money transfer service or online payment platform. These options are faster, more secure, and often cheaper than dealing with paper checks. With a little research and caution, you can find a solution that works for your unique needs.
Here are a few key takeaways to remember:
- Walmart only cashes pre-printed checks drawn on U.S. banks in U.S. dollars, with a few exceptions for some Canadian checks.
- International checks can take several weeks to clear and may be subject to high bank fees and lengthy hold times.
- Scammers often use fake international checks to steal money, so be cautious about unexpected or suspicious checks.
- For faster and safer international payments, try a money transfer service, online payment processor, or wire transfer instead of a check.
Navigating the world of international checks can be tricky, but with these expert tips, you‘ll be better equipped to make smart choices. By understanding the risks and alternatives, you can find the best way to access your hard-earned money from abroad. Happy banking!
