What Are Some State Regulations for Check Cashing Businesses?


Quick Answer

Some state regulations for check cashing businesses in California include requiring a permit and filing returns with the Franchise Tax Board, according to the State of California Franchise Tax Board. Other states may have additional laws and regulations, such as obtaining a specific license and adhering to strict guidelines.

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Full Answer

In California, the check cashing business permit is issued by the Attorney General's Department of Justice, according to the State of California Franchise Tax Board. This is part of the check casher permit program. This is for people who not only provide check cashing services, but also issue money orders, warrants and other commercial paper services. This is not required of banks or credit unions that cash checks.

Another state regulation for check cashing businesses is that they clearly list fees for cashing checks, issuing money orders and preparing drafts, says the State of California Franchise Tax Board. They must also post other eligibility requirements, such as the type of identification a customer needs in order to have a check cashed.

Other states, including Washington State, require businesses to obtain a particular license in order to be a check cashing business, according to the Washington State Legislature. In Washington, the same license is given to check cashing businesses as to businesses that provide payday loans. After being approved for the license, it is valid unless it gets suspended or revoked.

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