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Did you know that, according to the Federal Reserve, roughly 6% of adults in the U.S. don't have a bank account?
Whether by choice or not, there are a lot of reasons why someone might not have a bank account. But what do you do if you need to send money to someone without a bank account?
Thanks to modern technology, you have plenty of options, including using prepaid debit cards, money transfer services, and payment apps. You can also use traditional methods like writing a check or handing over cash.
The trick is figuring out the best tool for the job, since many alternatives come with fees or other downsides.
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Key takeaways
- You have high- and low-tech options to send cash to someone who doesn't have a bank account.
- Make sure to compare fees, since some money transfer services can be very expensive.
- Bank accounts come with a lot of built-in protections against losing your cash, but you can work around those dangers if you're careful.
- Never send money to someone without verifying their identity first, especially since many bank-free money transfer options are ripe targets for scammers and thieves.
Use payment apps
- May offer FDIC coverage and other financial services
- Funds available for immediate use
- Easy to split costs in social situations
- May be able to withdraw cash at ATMs
- Uses security features on your smartphone
- Generally free transfers
- Requires ID verification
- Limits on transfer amounts
- Commonly targeted by scammers
- May not be able to recover stolen funds
- Money may not be covered by government protections
If the recipient has access to a mobile phone or internet connection, a quick and easy way to send them money is with one of many popular payment apps. People often use these tools for sharing expenses, but they can also work for sending money when your friend or loved one is in a pinch. We'll cover three of the most common options here:
Cash App
Despite its name, Cash App can also handle non-cash money too, like bitcoin or even stocks if that's what you're into. Like the other apps, it's generally free to send and receive money from friends in the app.
Although this app is very popular, there are some transfer limits to consider. Until verifying their identities, all new users can receive or send only a total of $1,000 over 30 days. In addition, you and the recipient can't keep more than $1,500 in your accounts until you've undergone the verification process.
PayPal
PayPal is one of the largest financial service companies in the world, having nearly 427 million active users, per Statista. Sending money through the PayPal app or website is quick and easy, and millions of retailers worldwide accept PayPal directly to pay for purchases.
It's also free to send money from your bank account unless you're sending money abroad, in which case you'll pay a 5% fee (up to $4.99). There are no fees to receive money via personal domestic transfers. If you verify your PayPal account, you also can send up to $10,000 (or more) without bumping up against any transfer limits.
Venmo
Venmo is primarily a peer-to-peer money transfer app rather than a payment solution like PayPal. Still, it offers a similar experience, and it's free to send money in most cases. You can't send or receive money outside the U.S., though, and you'll need to verify your identity if you want to send more than $300 per week.
Once the recipient has the money in their account, they may not be able to spend it directly with as many businesses as PayPal. However, Venmo does offer a digital debit card that works with any Mastercard-accepting retailer.
Give them physical cash
- Allows for anonymity
- Available for immediate use
- No fees or technology to figure out
- Requires no ID or other paperwork
- Requires secure storage
- Not suited for online transactions
- Easily destroyed, lost, or stolen
- There is an increasing trend for businesses not to accept cash
Nearly 6 out of 10 people without a bank account use cash only, according to a 2021 FDIC study, the most recent data available. Cash is safe from any digital threats like hackers or internet outages, but you trade that safety for a higher risk of real-world threats.
In particular, cash is easy to steal, especially when you're not there to physically watch it all of the time – like when you send cash in the mail. For that reason, if you're giving someone physical cash, your best bet is to hand it over in person, to reduce the risk of theft.
Write a check or money order
- Slightly lower theft risk than cash
- USPS-recommended way to send money by mail
- Check cashing services at many convenient locations
- Replacements available if lost
- Often requires an ID to receive money
- Potential fees to send and/or receive money
- Requires cashing
- Limits on how much you can send per money order
According to the FDIC, 1 in 3 people without bank accounts received checks or money orders in 2023. Checks function like IOUs from your checking account with the money taken out later, while money orders act like prepaid checks with money paid upfront.
Personal checks are generally free to write and send, but official checks like cashier's checks can come with fees. You may also pay a small fee (usually up to $5) to have your bank or a retailer print a money order, and each money order is generally limited to $1,000 or less.
If you know the check or money order was lost or stolen and you catch it before the wrong person cashes it, you can often place a "stop payment" order for a fee to avoid losing the money. Some exceptions include USPS money orders and cashier's checks. I had to do this several years ago when my money order for a bill got lost in the mail. The process required filling out a form, paying a hefty processing fee, and waiting a few weeks for my replacement.
When someone without a bank account receives a check or money order, they can sometimes convert it to cash at a bank or – more likely – a nonbank check cashing service, which you can find at the customer service counter in many chain retail stores. However, fees are one of the biggest downsides; most check cashing services charge a fee of up to 12%, leaving a lot less for the recipient.
Get a prepaid debit card
- No risk of overdrafts
- Money usually protected by FDIC insurance
- ID and paperwork not always required
- Can use directly with most retailers and potentially at ATMs
- Can reload card with cash and funds from bank transfers or checks
- Same banking protections apply to registered cards
- May be an easy target for scammers
- Comes with many different fee types
- Some merchants don't accept them
- Can't reload or get other benefits and protections if unregistered
Many people use prepaid debit cards as an alternative to having a bank account, and they often work just about the same way, with a few exceptions. Not all prepaid cards require you to provide your ID and register your account, but many do.
If the person receiving the funds is able to register their account, they'll get access to many of the features that bank accounts offer, like FDIC insurance, fraud protection, and the ability to reload the card with more funds. Otherwise, it'll just function more like a one-time-use gift card.
The biggest downside is the number of fees these cards often come with. The Green Dot Visa Debit Card, for example, charges a $7.95 monthly fee (unless you get a $500 eligible direct deposit each month), $3 ATM withdrawal fees, $5.95 to get a 12-pack of paper checks, etc.
Provide a gift card
- No ID required
- Can allow for anonymous payments and gifts
- Can use directly to make purchases
- Not reloadable
- Often targeted by fraudsters
- Funds may eventually expire
- Little or no recourse for stolen funds
- Often only usable at certain merchants
Gift cards act more like a digital version of cash, even more so than prepaid cards. They generally come in two flavors. Credit card processing networks (such as Visa or AMEX), often put out gift cards that you can use with any merchant that accepts those cards. You'll also see gift cards created specifically for individual retailers, like certain grocery store chains, department stores or Amazon.
In all cases, once someone spends the money on the gift card, it's gone. Unlike with prepaid cards, there are no federal rules that say you can get your gift card money back by jumping through the right hoops.
That's why gift cards are a preferred option for thieves who impersonate loved ones and implore them to send funds via gift cards. If you register your card and hang onto your receipt, however, some gift card companies might return your funds.
Use money transfer services
- Instant transfers
- Widely available
- Physical cash pickup option
- Send money internationally
- Can be expensive
- May need to visit a physical location and show an ID
- Often targeted by thieves
- Limited hours for cash pickups
You're probably familiar with companies like Western Union and MoneyGram that allow you to wire money to someone instantly around the world. This makes them dependable options for emergency cash transfers. Many retailers, such as Walmart, also partner with these companies to offer money transfer services. While that makes them super convenient, there are differences that we'll compare.
MoneyGram
MoneyGram has around 430,000 locations across more than 200 countries. You can send up to $10,000 domestically with a MoneyGram transfer, and your recipient can pick up the cash directly from a local MoneyGram location.
You can estimate your costs online, but to give you an idea of how much you'll need to pay, it'll cost you about $17 to send a $1,000 domestic transfer to someone. MoneyGram does offer a few additional options to send money abroad, such as a deposit to someone's Visa debit card.
Western Union
With hundreds of thousands of locations in more than 200 countries, Western Union is more widely available than any other money transfer service. You can send someone money to pick up in cold hard cash. I've used this service a few times to send gifts to a friend who didn't have a bank account, and they liked having many nearby locations to pick up their cash.
It offers a handy price estimation tool that you can use to calculate the transfer fees online – but be warned that the fees are steep. Without a bank account, your recipient can only pick up cash in person. It'll cost you between $21 and $158 to send a domestic transfer of $1,000 via cash pickup, for example.
Ria
Ria isn't quite as widespread as Western Union, but it's no slouch: It's still available in 190 countries. Besides having the recipient pick up cash at one of the eligible partner locations, you have a couple more options, such as sending it to the recipient's mobile wallet or directly to their home in limited cases.
You can calculate your money transfer costs online, but to continue with our example of a $1,000 domestic transfer for cash pickup, you can expect to pay $8. Your first money transfer, however, is free.
Send cash to the person's digital wallet
- Funds available immediately
- Can set up recurring payments
- Usually no fees to send or receive money
- Can use funds directly for purchases
- Funds protected by your mobile device's security features
- Limited transaction amounts
- Might be unable to recover sent funds
- May require ID to sign up for service
- Requires internet or cellular connection
- Only works between the same device types
- May not be available in all states and countries
- May only be available with certain mobile carriers
You can add gift cards and prepaid cards to your smartphone's digital wallet app, but there's another way to use your digital wallet. These apps can come with free digital cards (Apple Cash or Samsung Pay Cash) that you can use to send and receive money from other people.
To send money, you'll need to add your bank account or debit card details so that the service can add money to your Cash card. You can then send funds directly to someone else with that same device and wallet combination (e.g., you send money via Apple Cash to a friend with an iPhone who also has an Apple Cash card in their wallet) directly through the messaging app on your phone or through the wallet app.
Picking the right method for sending money
You'll need to weigh a lot of factors when trying to find the best method to send money to someone without a bank account. Here are the main things to consider:
- Fees: Many services charge fees that don't sound like much at first but can make a big dent in how much the recipient actually gets. It's doubly unfair considering that many services may be free for people with bank accounts.
- Security: No money transfer options are risk free; it's just a matter of weighing the risks for your particular case. If someone is houseless, consider if they have a safe way to store physical cards and cash or have a digital option like Apple Wallet. Verify that you're sending funds to a legit person and check whether you can recover funds in case someone scams you.
- Speed: Transfers may be instantaneous in some cases, such as with Samsung Pay Cash, or can take days if you're sending a check via mail.
- Transfer limits: You can transfer very large sums with some services, like wire transfers. Often, though, you're limited to sending a certain amount, especially when you're using apps.
- Reloading options: If the person receiving the money will need funds again, consider a reloadable option like a prepaid debit card over a one-time-only deal like a money order. That way, they can get funds instantly again after they set the card up.
Tips for sending money to someone safely
Many options for sending money to someone who doesn't have a bank account are quick, easy, and untraceable – which makes them ideal candidates for scammers. Some money transfer methods are more vulnerable than others, such as sending someone a wire transfer versus giving them cash in person.
Here are some ways you and your sender can protect yourselves to make sure you don't lose money to a scammer:
- Don't send money to someone you haven't met in person.
- Always keep receipts and complete any optional card registrations, if possible.
- If someone calls you pretending to be a friend or family member and asks for money, hang up and call the friend or family member back before you send the funds. Ask questions that only they would know.
- Don't store money in places not covered by government protections – whether that's in your Venmo app or hidden under a vending machine.
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FAQs
Is it possible to transfer money without a bank account?
Yes, you can. Although there are benefits to sending money to someone's bank account, the recipient doesn't necessarily need one. Sending them money using your smartphone's mobile wallet, prepaid cards, cash, money transfer services, or mobile apps can all be good alternatives if you're mindful of the fees and risks.
Which money apps don't require a bank account?
Most money apps don't require a bank account. However, they may limit users to storing the money in the app, which isn't always safe and can limit the ways to use it.
What are safe ways to send money to someone without a bank account?
Always verify the identity of the person to whom you're sending money, such as by contacting them in another way and asking them questions only they would know the answer to. Keep any receipts for your transfer and read the terms and conditions so you know your rights.
Bottom line
When choosing a way to send money to someone without a bank account, carefully weigh your options. Look at features like convenience, flexibility, and the speed of money access and compare them against potential drawbacks like fees, limited compatibility, and security risks.
If the recipient can't get a bank account due to problems managing one in the past, they might consider a second-chance checking account that may be easier to qualify for. If it's fees they're worried about, consider reviewing our list of the best free checking accounts for options.
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