Can you cash a business check without a bank account? Yes. Options available include cashing the check at the issuing bank Issuing bank refers to the bank where the funds will be drawn from. , retailer, or check cashing store, getting a prepaid debit card, and endorsing the check to a third party.
Sole proprietors may be able to cash a check in their business name, but some banks may require you to open a business bank account and deposit the check there instead. The process can be more complicated if your company is a partnership, limited liability company (LLC), or corporation since some banks will observe restrictions or not offer the option of cashing the check.
If you are operating as a business, the better option is to open a bank account in your business’s name to make cashing transactions easier.
1. Take the Check to the Issuing Bank
You can visit the bank that issued the business check you want to cash since it will be easy for it to confirm if the account has sufficient funds. While banks are not obligated to serve non-customers, many provide this service and charge a fee for cashing a business check. Certain restrictions may also apply, such as withdrawal limits on the check amount.
The table below shows the cashing-service fees charged by some traditional banks when noncustomers present a check. You can avoid paying these fees by opening a checking account.
Check Cashing Fees for Noncustomers | For More Information | |
|---|---|---|
Bank of America | $8 per check | |
Chase | $10 for checks over $50 | |
Wells Fargo | $7.50 per check | Read our Wells Fargo business checking review |
2. Visit a Retailer Offering Check Cashing Services
Another way to cash a business check without a bank account is to head to large retail chains and grocery stores that offer check cashing services. Policies can differ, so it is important to research first before deciding which retailer to pick. Some may place restrictions on the type of business checks they will accept and impose check cashing limits. Fees can also vary depending on the check amount.
3. Utilize a Check Cashing Store
A convenient method for cashing a check when you don’t have a business bank account is through check cashing outlets. Since these stores specialize in cashing checks, it is often easy to convert your business check into cash. However, the drawback is they often charge steep fees, which can either be a flat fee or a percentage of the check amount.
4. Purchase a Prepaid Debit Card
Small business owners without business bank accounts can buy a prepaid debit card. The card makes it easy for you to deposit business checks through the card provider’s mobile app. Once the check clears, you can withdraw the money through ATMs. You can also store the money inside the prepaid debit card and use it for online and in-store purchases. However, this option can require paying fees for card activation and ATM withdrawals.
5. Endorse the Check to a Third Party
If you want to avoid the associated fees of check cashing, you can ask a trusted third party who has an account with the issuing bank to deposit the check for you and withdraw the funds when it’s available. You will need to endorse the check but, before doing that, confirm if the bank will allow it.
Pros & Cons of Each Check Cashing Option
Each check cashing option offers an advantage and some disadvantages. Check the table below to find out which one works best for you.
Options | Pros | Cons |
|---|---|---|
Issuing Bank | Convenience |
|
Retailer | Accessibility; has plenty of locations |
|
Check Cashing Stores | Easily available specialized service |
|
Prepaid Debit Card | Ease of purchasing a prepaid debit card |
|
Third-party Endorsement | Lack of fees |
|
Steps To Cash a Business Check Without a Business Bank Account
- Step 1: Know where to cash the check. Call the issuing bank and ask if it offers a check cashing service for noncustomers if you don’t have a business checking account. Consider other options if this service is unavailable.
- Step 2: Endorse the check. Checks written for your business require an endorsement, which means writing your business name and designation and signing the back of the check.
- Step 3: Present your ID and business documents. A government-issued ID is required before you can cash a business check. Primary IDs include United States state cards, US driver’s licenses, and US passports. You can also ask the bank what other IDs are acceptable if you do not have a government-issued ID. Meanwhile, your business documents will show proof of business ownership and indicate your authority to cash the check.
Remember that banks typically charge a service fee if you cash a business check without a business bank account. Some may only allow free cash checking up to a set limit. Note that other banks may not permit cashing a check made out to a business, so you may need to open a business account with the bank to deposit the check and withdraw the funds once the check clears.
Possible Issues With Cashing Business Checks Without a Business Bank Account
Compared to depositing business checks, cashing them without a business bank account requires preparation. You may encounter potential issues when presenting your check for cashing.
Here are some of them:
- Missing proper ID: Your identity needs to be verified before a check can be cashed. A government-issued ID must be presented as proof of your identity. If you don’t have a primary ID, it is best to contact the bank and check what type of secondary identification documents they will accept.
- Depositing stale checks and post-dated checks: Legally, banks honor checks issued within six months. Outside of that period, the checks are considered void and referred to as stale dated. On a case-to-case basis, some banks may allow customers to cash checks beyond six months, but this remains at the discretion of the bank. Meanwhile, banks can also decline to cash a check with a future date, which is termed a post-dated check.
- Cashing large amounts: If you intend to cash a check with a large amount, you need to notify the bank or the branch. Bank branches have cash limits and may not have enough funds to release right away. By contacting them, banks can arrange a scheduled time for cashing the check or advise you to visit a main branch or another bank to complete your transaction.
Benefits of Opening a Business Bank Account
Small business owners or sole proprietors who are just starting often combine their personal and business funds in one account, as they find it convenient. They may even use personal checking accounts for business.
However, without a business bank account, it can be challenging to cash business checks paid out in your business name. You can separate your personal and business finances by opening a dedicated business bank account.
Different business bank accounts are available to small businesses. One of the first accounts you should consider opening is a business checking account, which allows you to write checks for your business suppliers, pay company bills, and deposit and withdraw funds for your business. Read our guide to the best small business checking accounts for options.
Among the benefits business bank accounts provide are:
- Offer convenience in cashing business checks
- Help in building business credit
- Provide accurate business records
- Let you cultivate a solid banking relationship
- Simplify tax season
- Lend business credibility
- Allow easy tracking of business performance
Before opening an account, read our guide on how to open a business bank account. It includes a free downloadable checklist of documents typically required upon account opening. You may also be interested in reviewing our comparison guide on credit unions vs banks to see which financial institution suits your business needs.
Frequently Asked Questions (FAQs)
Banks generally honor business checks within six months (180 days) from the date of issue. However, different types of checks may vary in expiration dates, such as cashiers’ checks and government-issued checks.
Yes, you do if you will be cashing the check at a bank. However, using other check cashing options, such as a prepaid debit card or a third-party endorsement, will not require an ID.
No, not all banks offer check cashing services to non-customers. In general, banks that offer these services charge additional fees.
Yes, you can still cash a business check without depositing it by visiting the issuing bank or going to a check cashing store or retailer.
Bottom Line
Small business owners can choose different options to cash a business check without a bank account. They can go to the issuing bank, retailer, and check cashing store. They can also use a prepaid debit card or endorse the check to a trusted third party. However, the best solution is to open a business bank account to make cashing checks convenient, avoid check cashing service fees, and access your money easily.
