About Ken Tumin

Ken Tumin founded the Bank Deals Blog in 2005 and has been passionately covering the best deposit deals ever since. He is frequently referenced by The New York Times, The Wall Street Journal, and other publications as a top expert, but he is first and foremost a fellow deal seeker and member of the wonderful community of savers that frequents DepositAccounts.


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Best Ways to Deposit Cash Into an Internet Bank Account


With ING Direct finally launching CheckMate for online check deposits, it becomes easier to use ING Direct for all of your banking. There are fewer reasons that you need a local brick-and-mortar bank. However, there's one reason to keep your local bank. It's much easier to make cash deposits. Most all internet banks allow you to deposit checks by mail, but that's not an option for cash.

Local Bank or Credit Union

My preferred method to deposit cash into my internet bank is to first deposit the cash into my local credit union or bank account. I can then initiate an ACH bank-to-bank transfer from my internet bank. This might not be a good option for some people who don't live close to their bank or credit union. With many banks adding monthly fees, people may be closing their accounts at their local banks.

Deposit Taking ATM

Another option for cash deposits is using an ATM that can handle cash deposits. Big banks like Chase and Bank of America have ATMs that can take cash. Some ATM networks like MoneyPass also have some ATMs that can accept cash. Even if your bank or credit union has a nearby ATM that accepts cash, you may not want to use it. If the ATM gets jammed when you feed it your bills, it can be a hassle to resolve the issue.

Mailing a Money Order

Another way to deposit cash into an internet bank account is by first purchasing a money order. Then you can mail the money order to the internet bank just like a check. One problem with this is that it usually costs money to purchase a money order. For example, the U.S. Post Office charges up to $1.55. Some people may have access to cheaper options. If you live in Florida, Amscot - The Money Superstore offers free money orders. My guess is that Amscot uses free money orders as a marketing strategy to attract more customers for their cash advance service.

Not all internet banks accept money orders. ING Direct is one that does not accept money orders for deposit. I just confirmed that by email last week. I checked with several other internet banks with popular checking accounts, and all of them say that customers can mail money orders for deposit. These include Ally Bank, EverBank, Bank of Internet USA, Incredible Bank and Clear Sky Accounts.

PerkStreet Financial

The only internet bank that I've found to provide a cash deposit option is PerkStreet Financial. They have a contract with MoneyGram which has 18,000 locations nationwide, including every Wal-Mart store. You can deposit cash into your PerkStreet checking account via a MoneyGram Express Payment. PerkStreet picks up the fee.

Consider a Local Bank or Credit Union Account

There are some advantages in having a local brick-and-mortar bank or credit union. If you want to avoid monthly fees without a large balance at a big bank, you may want to consider a plain savings account. These sometimes have smaller minimum balance requirements. One example is Chase Bank which waives monthly fees on its Chase Savings account for a minimum daily balance of $300. Bank of America also has a $300 minimum balance requirement to avoid a monthly fee on its Regular savings account. Don't forget that all savings accounts limit certain withdrawals to a maximum of 6 per month. Some banks will hit you with a fee for even fewer withdrawals. For example, Bank of America charges a fee for more than 3 withdrawals per month.

If you want to avoid the big banks, consider a credit union. Most credit unions have free checking accounts with no monthly fees. Also, many credit unions are part of a shared branch network (CU Service Centers). For more information, please refer to my post Finding the Best Free Checking Accounts at the Best Credit Unions.

In addition to making cash deposits, there are other reasons that it can be helpful to have a local bank or credit union. Some offer free notary service, free coin counting machines, and paper shredding. What services do you use at your local bank or credit union?

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Comments
Anonymous
  |     |   Comment #1
Ken, you always going to need a local bank, not only as a point of entry of checks and cash, but at times when your Internet or electric power or your computer is down or malfunctioning.
Also, local banks can provide other valuable service like, notary, official checks, as guarantor for signature and many other services.
You can never be online only customer, what about if the Internet bank is hacked or their web site is out or there is an error or there is a false entry or there is disputed charge, by the time all is sorted out, you may be out of money waiting for online bank to be available again.
With my local bank I can pull money from my Internet bank account and continue to live like nothing ever happened.
Something to think abut now, not when the disaster strike.
Circy
  |     |   Comment #21
What if a pandemic happens and your not allowed to leave your house and all the banks are closed.... You can digitally sign things. I think you underestimate the future... Currency can be verified via Blockchain tech already. Infact more verifiable than a silly paper with images. This is now what's to come in 20 years? Banks rely on the poor for fees and the rich for interest and loans. Sickening honestly. Recall any bailouts? That shows obvious flaws, to the system itself! Don't get me wrong tech has a ways to go ,but with redundancy backups and power hosted encrypted nodes, blackouts would be very limited to small fragments of the networks users and easily isolated/repaired. Connections would even likely have redundancies in case of service interruptions. So aside from cyber attacks (same issue brick and mortar ex. Bank robberies fires floods tornados earthquakes pandemics killer bees... ) At least I can't get shot online banking ;) +1 never say never because the earth was never flat.
Shorebreak
  |     |   Comment #2
I agree with #1, Monday, April 30, 2012 - 2:32 PM. There will almost always be a need for a local brick-and-mortar financial institution to conduct the other items mentioned above. Also a safe deposit box located nearby is quite handy to keep important papers and valuables secure. I also deposit any cash into a checking account at a locally-owned bank. Where upon, if needed I initiate an ACH transfer to my online bank.
Circy
  |     |   Comment #22
Important papers? Scan them encrypt them. Put them in a cold wallet and a fire proof safe. Cash? This paper system is nearly over. China digital... USA working on digital.... 2022...2032? 2042... Paper cash is sold as a collectors item [still accepted at it's value] largest us paper bill $100, value? compared with the trend of current inflation. Probably 10 min of worker pay at min. Wage... Or enough fuel to get you out of your driveway and to the stop sign at the end of your street (.4 miles) rofl... Everyone seems to doubt the future but at one time your parents doubt mobile phones, how about what phones? The worlds knowledge in the palm of your hand able to access any of it in seconds.... Imagine just the last 150-200 years now 2x that just as a bare minimum more like 10x+ in the next 150-200 years. ????. Yeah your brain just exploded, right? Or humans are all dead by then, that's the only real other route :)
Kaight
  |     |   Comment #3
I'm generally in agreement with the earlier two comments.  I have a local (small) bank and cannot imagine being without my accounts there.  At the same time, I give my local bank virtually none of my profitable (for bank or CU) business.  I worry that eventually, if others are operating as I do, the local bank will be unable to provide the service they offer me.  Their costs are high, their profit, from my transactions with them at least, is quite small . . . if indeed they have any at all.
Anonymous
  |     |   Comment #4
I now depsoit all my checks at the Chase ATM.  It is easier than going inside the bank and faster and NO lines. No forms that can get lost or stolen at the bank.  You can deposit the checks 24x7  Put in your card and the checks.  Get a receipt with the check images printed on it I.  The rare exceptions I need a branch are for a signature gurantee or an offical check.  The safe deposit boxes are getting too expensive and if the bank is robbed they will not insure you in anyway.  I just have a safe in the house.  I'm sure one could get away from offical checks by using ACH or have an ATM print one (In work we have an ATM that dispenses large amounts of travelers checks) and make some notraies (They are a dime a dozen) be allowed to do signature gurantees.  If these 2 items can be addressed I would not need a bricks and motor bank. The on-line systems have excellent availability.

 

  The online systems are reliable so I'm not worried about access to my money. 

 

 
Anonymous
  |     |   Comment #5
A bank could mail out offical checks.
Anonymous
  |     |   Comment #6
Totally agree that we will always need a 'local' bank, but will there always be a 'local' bank? For some reason, the way things are evolving, I don't think so. Then what?
Anonymous
  |     |   Comment #7
To Anonymous - #4,

I guess you have been lucky so far and have not have any illegal charges on your debit card and your home have not been under long time power outages.
My Internet account was frozen do to unauthorized charges and I could not use my account for 17 days. To put salt on the injury, we had a local tornado that put down the power lines for 2 weeks last autumn and some of my mail correspondence never reached the Internet bank and I had to re-mail everything for a loan that put a delay of 18 days.
These are just few mishaps I had with an Internet bank and hope you never go through this, but will happen one day, so be prepared now.

To Anonymous - #5,

Have you ever ordered an official check from Internet bank?
I have, unless you pay $25 for overnight delivery, be prepared to wait 5-7 business day for the check to arrive.
Circy
  |     |   Comment #23
When exposing your debit card number you should use a virtual number that masks your actual number and is only valid for that one purchase... If they never would have had your card number and you would have never had fraud... No of course nothing is ever fully protected no matter how much encryption it can obviously always be broken no matter how safe you try to guard something it can always be stolen. But there's a point where a thief will give up if the reward is not worth it. So unless you on Tesla or Amazon you're probably going to clear :)
Anonymous
  |     |   Comment #11
I have very rarely ever used any brick-and-mortar services. The checks mail out fine, I've never needed to "rush" a check... My life is online. That may be "bad" but it works well for me :)
Anonymous
  |     |   Comment #12
I can take a photo of all my checks for very fast deposits. Brick and mortar WILL NOT last much longer. I NEVER pay a fee with my online account! Wish someone would figure out the minor convern over depositing cash. It would be easy enough, just let me deposit cash at BOA, at their ATM, and wire the money for me. No need for brick and mortar just ATM's that take cash, done.
Circy
  |     |   Comment #24
I totally agree I don't understand why the internet Banks haven't made an agreement with the brick and mortars with cash deposit in the ATMs... My assumption is the brick and mortars don't want to make a deal because they know once they did they would basically be giving up a large customer basis to the company that they allowed to use their ATMs therefore enabling their enemy or competitor to over take them.
Anonymous and Jaded
  |     |   Comment #13
The irritating part, is I work, I produce a product, I deliver a service, I fulfill my contracts, I get paid I have money, THEN in order to spend it I need a bank! We need some kind of change, revolution if you will, to return the power of the resource holder. The money is mine and I deserve every bit of it pending the legal taxes and obligations that otherwise are part of doing business... but there is no good reason that I should be required to use a financial network that is built on ubiquity and nothing else.
Anonymous
  |     |   Comment #14
The solution will be Bitcoin, once more people are using it and are paid with it. This will remove the middleman from the equation.
Circy
  |     |   Comment #25
Okay so I'm mostly on board with you but however it won't be Bitcoin... There will be another more advanced more protected more verifiable and much faster moving... The speeds of quantum will be mind-bending compared to what we have currently and no one will want to wait for a transaction they will want what they want right then right there that split second. They will not have the patience for Bitcoin transactions. Put basically I believe you are correct... Welcome to the crypto block chain, the future of currency until something better comes along :) I say better because with quantum technology comes a whole another task of creating encryption in which the current blockchain technology may not be able to stand up against attackers... Thank you though for putting this out there :) I ??

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