People are constantly moving to different States for business or pleasure. Sending money to people without bank accounts may, therefore, prove difficult. Do not fret because outlined below are the alternatives methods on how to send money to someone without a bank account.
A study conducted by the Federal Deposit Insurance Corporation showed that in 2017, 6.5% of American households were unbanked. This figure was approximately 14 million adults without bank accounts. However, this factor may be alluded to due to other available methods of sending money such as mobile apps, transfer agents, money orders, and sending money online with a credit card.
We have compiled some of the common ways on how to send money to someone without a bank account.
How To Send Money To Someone Without a Bank Account
1. Paypal to Paypal
PayPal is an online wallet used to conduct various money-related tasks. The platform was initially meant for payment of items purchased online. With time, more people embraced the idea of sending and receiving money via PayPal. When sending money via PayPal, all you need is the other person’s PayPal address.
What makes PayPal stand out is that even though the person will not be able to withdraw without a bank account, he may withdraw using a debit or ATM card issued by PayPal. If he does not have access to such a card, he may opt to make his payments directly from PayPal.
However, you can still send money online using a bank account as long as the account has been successfully linked to PayPal.
- No commission is charged for sending money
- It is fast. A transaction will reflect in a matter of hours
- Loading money into the PayPal account is free
- PayPal users can be issued with debit and ATM cards by PayPal
- PayPal is a standard payment option for most online shops
- It is safe
- PayPal users have a record of when and where the money was sent
- You can pay for items without having to enter your card details every time
- The debit and ATM cards by PayPal are not issuable in all countries
- The security checks can be tedious to go through
- The receiver must have a PayPal account
- The rates of currency conversions may not be favorable to the receiver
- The receiver must constantly change his password after some time to ensure his money is safe
2. Sending Money through Mail
Sending cash via mail is risky as the package may get lost, stolen, or even damaged. However, there are smart ways to send cash via mail.
First, you will have to convert the money into a check, money order, or cashier’s check. This makes the package less suspicious. Another reason why money orders are safer is that they have the receiver’s name. This ensures that only he can withdraw the money from an agent.
- Posting the money does not require complicated steps. All the sender has to do is draft the money order or check and take it to the post office for shipment
- The money is safe as it strictly contains the recipient’s details. This makes it hard to steal as compared to cash
- International money orders allow you to send money to people from all States
- If the money is lost on transit, the sender may regain it by going back to the drafters of the money order or check
- Converting real cash into a money order may be a long process. One has to provide verification details such as identity cards and proof of location. Some institutions also limit the total amount of money you can send
- Money orders can be stolen through forgery
- There is little or no proof that the money was sent
- If stolen, the funds cannot be retrieved
- It may take up to a week before the receiver gets the money
- Sending mails is an industry that is slowly dying. Should it reach a point where only a handful of people are using it, it shall be closed indefinitely.
3. Western Union Money Transfer
There are well over 100,000 branches of Western Union spread in 185 countries. The widespread use has made this platform one of the most preferred modes of sending money to people without bank accounts. The sender can choose to either send the money directly to the receiver’s account (if he has one) or opt for the receiver to pick his money from an agent. The platform’s versatility also enables one to send money to an e-wallet.
- The fees charged are pocket-friendly
- The recipient can pick the money in cash
- You can send money by directly taking the cash to a Western Union agent near you
- You can also send the money from your bank and have the recipient withdraw cash from his agent
- There are hundreds of branches in one location
- You are charged a fee every time you send money
- The recipient has to go all the way to an agent to withdraw his money
- The platform may be inconvenient if either the sender or receiver does not have fast access to a Western Union agent
- The platform’s disclaimer states that they shall not be liable for any money lost via transit. This makes it hard for people to recover their money if it goes missing, especially if they were conned.
4. Google Pay
Google Pay, the new rebranded app from the combination of Google Wallet and android pay is somewhat similar to PayPal in that both are e-wallets. As much as the former is much less famous compared to PayPal, it is still an excellent platform for sending money to people without bank accounts. Supposing the receiver does open a bank account, the sender can send money to the bank account instantly.
The great thing about Google Wallet is that once the funds are reflected in the receiver’s wallet, he can transfer money from checking account to a prepaid card online.
- Sending money is fast. The transaction reflects in a matter of hours
- All you need to send money to somebody else is to link their email address
- Sending money on Google Wallet is free
- Google gives its own ATM and debit cards to users of Google Wallet.
- Money can be sent through SMS chats
- Google is a reputable company that is known worldwide. This has earned it the trust of people from all over.
- It is not a commonly employed method for making online purchases
- Recipients must first acquire the Google debit cards to withdraw the money
- The platform is only available in a few countries. Recipients in Africa cannot receive money through Google Wallet
5. Walmart to Walmart
Walmart transfer enables you to send money online with a credit card, even if the other person does not have a bank account. Once the money is sent, the receiver can go to the nearest Walmart store and withdraw it through the Walmart agents. If you send money through a Walmart agent, the receiver can withdraw his money immediately. However, if you carry out your transaction online, it may take up to 3 days for the funds to reflect in the receiver’s Walmart wallet.
- Senders can transact up to $6000 in a month
- Receivers can pick their money either at Walmart stores or MoneyGram agents
- The transaction process is fast if you send money through Walmart agents
- Recipients must provide identity cards to reduce cases of fraud
- Walmart has plenty of agents available, which makes it convenient
- The commission fees are not high
- The recipient has to be close to a Walmart agent
- Having to pick up the money in person is inconvenient
- Transfer fees are incurred when sending money
How Do I choose the Transfer Method?
- Urgency of funds
If the receiver is in dire need of the money, consider instant transfers such as PayPal.
Some online money-sending platforms charge higher rates compared to others. For instance, sending money via PayPal is free, whereas sending money via Western Union charges commission fees. If the sender does not have PayPal, he may want to use Western Union as it is a reputable platform. However, if he cannot afford to incur commission rates, he should sign up on PayPal or Google Wallet.
Sending money via Walmart requires you to go to a Walmart agent to make the transaction (if you want the receiver to get the funds immediately). On the other hand, you can also opt to send money online via the same platform if no Walmart store is close to you.
Platforms such as Google wallets have been incorporated with encryption to prevent third parties from accessing your card details. This may be the most suitable option if you plan on sending a large amount of money.
Over to You
The most appropriate method of money transfer depends on your circumstances. Factors such as commission rates, urgency, and location of the receiver should help you decide which model will work best for you.