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Market Research Report

U.S. Check Cashing & Money Transfer Services: A Market Analysis

Published by Marketdata LLC Product code 69013
Published Content info 145 Pages
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U.S. Check Cashing & Money Transfer Services: A Market Analysis
Published: June 1, 2013 Content info: 145 Pages

This publication has been discontinued on January 9, 2019.


Print or digital format. Also sold by individual chapters.

This updated analysis by Marketdata Enterprises examines the controversial but growing “alternative financial services” sector - a $34 billion business comprised of fragmented and loosely regulated check cashing and money transfer services. Payday loan stores and pawn shops are also considered. These outlets serve 35% of the U.S. population. Many companies are happy to accept the business of consumers with spotty credit records who have been rejected by banks--the 12 million “unbanked” households that choose not to use traditional banks.

There are 11,800 check cashing outlets, and nearly 1 million money transfer agents competing for this business today. Many outlets/services overlap-providing multiple services at the same site. The study explores why check cashers have had to diversify, and the effects of the economic slowdown, competition, and new technologies.

This new study by Marketdata examines the nature of the business, reasons for the growth of non-bank services, immigration trends, industry receipts/growth from 1999-2012, 2013 to 2017 forecasts, average store revenues, extensive customer demographics, key industry trends, federal/state industry regulation/fee caps, self-service check cashing machines, profit margins, franchising, gold buying/selling, global remittance trends, consumer debt levels, reasons for the industry's improved image, and more. Findings of research studies by: Fannie Mae, Georgetown University, FISCA, Federal Reserve Board, brokerage analysts, Natl. Check Casher's Assn., state banking departments, The World Bank, INS, U.S. Census Bureau, FDIC, brokerage firms, and more.

This study is believed to be one of the few in-depth publicly available business analyses that exists of this market. Seven in-depth company profiles (some with 2008-2012 financials) are provided for: ACE Cash Express, Check Into Cash, DFC Global, Western Union, Moneygram, Ria Financial, Check Into Cash, and AMSCOT Finacial.

Table of Contents

Table of Contents

Introduction: Study Scope, Sources, Methodology

Executive Overview of Major Findings ($300)

  • Definition of the components of the U.S. market serving consumers outside of the traditional financial services market (the “unbanked”). Alternative financial services: Check Cashing Stores, Money Transfer Services. Definition of each segment, nature of the business/how it works, number of outlets, reasons for growth, dollar mkt. size 1999-2012, 2013 & 2017 forecasts, major competitors.
  • Major market trends affecting each sector: move into payday loans and diversification to other services, state regulation, increased competition, industry critics, consolida- tion, etc.
  • Effects of the recession, 2008-2011 mkt. performance, new technology, shift to electronic payments via debit cards, U.S. immigration trends, remittance inflows/outflows
  • 2012 & 2013 outlooks for each segment
  • Composition of check casher revenues by type: 2007 vs. 2012
  • Discussion of reasons for growth of non-bank services, population below poverty level.
  • Discussion of household debt levels.
  • Discussion of bankruptcy trends.
  • Discussion of annual U.S. immigration.


  • U.S. Population Living Below the Poverty Level (1990-2011)
  • Reasons Why Unbanked Families Do Not Have Checking Accounts
  • Market potential: 1999-2012 estimated $ receipts of check cashing outlets, money transfers, pawnshops, payday loan services, total industry.
  • Check cashing industry revenues: 1999-2017
  • The major check cashing franchises: no. of outlets 2005, 2007, 2012
  • Money Transfer Industry Revenues: 1999-2017

Customer Demographics: The Unbanked Population ($175)

  • Discussion of the unbanked population, Findings of FDIC survey: percent and no. of unbanked households
  • Banking status for select demographic groups
  • Use of pre-paid debit cards, alternative financial services used most often
  • Reasons unbanked households don't have a bank account
  • Table: 1999-2012 market potentials of the major market segments: check cashing, money transfer, pawn shops, payday loans, total
  • Trends in consumer debt levels - discussion, last 5 years, delinquencies, analysis by Federal Reserve, 2007-2010 improvement trends
  • Table: Debt payments relative to family income: 2001, 2004, 2007, 2010 - by age of household head, % of income, % of net worth, housing status, past due status, discussion of mortgage vs. consumer debt levels
  • Bankruptcy trends: 1991-2012, non-commercial bankruptcies, (chap.7,11,13), Discussion, table, state differences
  • Foreclosure trends - discussion, recent trends, now vs. recession period
  • Table: U.S. population living below poverty level: 1990-2011.

The U.S. Check Cashing Industry ($595)

Summary & Nature of the Business: How Check Cashing Companies Operate

  • Industry definition and size. Number of outlets. Check cashers offer convenience for a price. Typical fees charged.
  • Other services offered: money orders, wire transfers, electronic bill payments, notary signatures, utility bill payments, tax preparation, gold buying, payday loans.

Industry History and Evolution

  • Beginnings in the Great Depression.
  • Impact of deregulation of the U.S. banking industry.

Customer Demographics (by gender, income, race, etc.)

  • Scarborough Research study.
  • Ace Cash Express customer profile.
  • FISCA 2006 trade group customer profile

Emerging Industry Trends

  • Check cashing fees on the rise, Consumer Federation of America survey
  • Federal Reserve Payments study, data for 2000, 2003, 2006, 2009
  • The entry of Walmart into the check cashing market - discussion
  • More competition from: Pay By Touch, 7-Eleven, Walmart
  • Table: Number/value/avg. value of commercial checks processed: 1989-2012
  • Table: Number/value/avg. value of government checks processed: 1989-2012
  • Table: Number/value/avg. value of postal money orders processed: 1989-2012

Industry Regulation

  • Federal Regulations, state regulations
  • Definition of: The Bank Secrecy Act, Money Laundering Suppression Act, USA Patriot Act, Gramm-Leach-Bliley Act
  • Table: Check Cashing Fees, by type check
  • List: List of state check cashing fee caps, by state: Sept. 2012
  • Table: State Banking Departments for States With Check Cashing Fee Maximums, address & phone.

Industry Size, Growth, Forecasts

  • Discussion of avg. annual receipts per store: for Illinois stores, ACE Cash Express, AMSCOT, DFC Global
  • Discussion of 2008-2011 market performance/trends, rise of payday loans
  • Number of outlets declining - discussion, data from 13 state banking depts.” No. operating in 2007 vs. today
  • Composition of check cashing revenues by type (check cashing, money orders, $ transfers, debit cards, bill payments, gold buying, tax preparation, pawn services, etc. % of total revenues) - 2012 vs. 2007
  • Discussion of no. of payday loan outlets, market value.
  • Industry sales and number of projected units for 2008 - 2013
  • Factors affecting growth in 2013 and 2017 - Marketdata forecasts.
  • Federal Reserve findings of non-cash payment trends: checks vs. debit cards
  • Discussion of the major franchises: start-up costs, franchise fees, royalty, no. units
  • Table: Industry sales: 1999 through 2012, 2013 & 2017F.

Check Cashing Industry Structure & Profit Margins

  • Review of the composite financial statements for check cashing outlets in New York State and Illinois.
  • Table: Illinois check cashing revenues: 2007-2011, dollar volume, avg. fee/check, check cashing fees & total revenues
  • Table: Illinois check cashing outlets, revenue mix by type: 2007-2011
  • Table: Composite income statement of Illinois check cashing outlets (2011), profit Margins
  • Table: Composite balance sheet of Illinois check cashing outlets (2011), assets & Liabilities by type
  • Table: The major check cashing franchises at a glance, number, fees, capital needed
  • Table: Check volume & fees reported: 1993-2006, New York banking dept.
  • Table: Composite balance sheet of NYS check cashing outlets (2003-2006)
  • Table: Composite income statement of (NYS) check cashing outlets (2003-2006)

Competitor Profiles

(headquarters location, services, detailed financials, mergers, history and company profile)

  • Ace Cash Express, Inc.
  • Check Into Cash
  • Dollar Financial Corporation
  • AMSCOT Financial

The U.S. Money Transfer Services Industry ($495)

Nature of the Business

  • The transition from the money order to the electronic wire transfers, how electronic transfers work.
  • Market drivers: analysis of global migration trends, U.S. population vs. foreign born, illegal immigrants
  • Discussion of remittance inflows/outflows, factors affecting, work visas
  • Industry trends: discussions of:
  • Industry is being driven by the rise in global immigration.

Regulation of the Industry

  • Review of state & federal regulations.
  • Definition of: The Bank Secrecy Act, Money Laundering Suppression Act, USA Patriot Act, Gramm-Leach-Bliley Act

Industry Trends

  • International money transfer market is very fragmented.
  • Major players have a small market share. Number of Western Union & Moneygram agents worldwide, role of Wal-Mart, mobile finance
  • New technologies present new competition, discussion of 3 transfer models used, mobile finance
  • Discussion of collapse of Moneygram.
  • U.S. banks are developing services for the U.S. - Latin America transmission corridor.
  • Table: Global migration trends, by world area: 2000, 2005, 2012
  • Table: U.S. population, foreign born pop., illegal immigrants: 2001-2011
  • Table: U.S. immigration, by country of origin: 2001-2011
  • Table: Global remittance inflows, developed/developing nations: 2001-2012
  • Table: Destination of outflows from the U.S. - World Bank, other data
  • Table: Global Wire Money Transfer Market Share, by company (2004, 2007)
  • Table: Number of Western Union and Moneygram Agents Worldwide (2002-2012)
  • Table: U.S. Bank money transfer products

Industry Size, Growth, Forecasts

  • Industry revenues for 1999 through 2012 - discussion & analysis
  • Table: Size of U.S. money transfer industry, revenues 1999-2012, 2013 & 2017 forecasts
  • Table: Size of U.S. money transfer industry, by company (Western Union, Moneygram,
  • Ria Financial, Post Office) 1999-2012

Competitor Profiles

(headquarters location, services, company history, recent developments, financials).

  • Western Union
  • Moneygram International
  • Ria Financial Services

Reference Directory of Trade Associations & Sources

Address, phone, contacts for major trade groups, consultants, list of industry studies and articles, Wall Street analysts/research reports.

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