99% Invisible - 99% Invisible-18- Check Cashing Stores

Episode Date: March 4, 2011

A few years ago, journalist Douglas McGray learned that the largest chain of check cashing stores in Southern California, Nix Check Cashing, was being bought by the nation’s largest credit union, Kinecta. The credit union thought it had something to … Continue reading →

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Douglas McGregor is going to be our guide. You walk through the door, you see the red carpeting, you see someone in a suit there, maybe greeting you, you see some ferns, you know, a nice row of professional looking people in suits behind the counter. You don't really see what it is they offer. Chances are if you walk into the bank, you look around, you're not gonna see a lot of services

or prices. You have to kind of know what you want going in there. Or you have to talk with someone to help you figure it out. If you think about it almost like it's like, if you went to a restaurant and there's no menu on the door and you walk inside and like instead of giving you a menu, they ask, what do you want? And you go Italian and then you have a conversation

about what they could provide and the 17 different sauces they could offer and all the different shapes of pasta. A reasonable person might think, like it'd be kind of nice to have a menu. Doug McGregor is a journalist. My name is Douglas McGregor. I'm a fellow at the New America Foundation and I'm the Editor-in-Chief of Pop Up Magazine.

And a couple of years ago, he wrote a story about Czechasers and Payday Lenders, which McGregor is quick to point out these are different services. Check cashing is when you have a check, it's made out to you. You go in with a check, you leave with cash. Minus a 3% fee or so, and payday lending is when you don't have any money. So you write the payday lender a check.

For $350 and you get $300 and they cashed in two weeks. Those are the much more problematic transactions if you happen to think charging 400% interest is bad for the working poor, but McRae found that for better or worse. You know, I think it's mostly for worse. These places are here to stay. What made surprise you though, if you have the same visceral reaction that I used to have to them?

If it's a person who's used to going to banks, they're gonna think they're a little bit grimy. Is that these check cashing stores, even with their problems? The fees are too high, I can't say that enough. You know, the fees are at most of them are too high. May teach banks something about using design to better serve a wider range of customers. The absence of the bank-like trappings, plush carpeting, ferns, big desks, suits, they're

missing for a reason. When Doug McGray went on a tour of a branch with Tom Nicks, who at the time was the owner of the largest chain of check cashing stores in Southern California, Nicks pointed out the design choices he made. He pointed out the linoleum floor, and he said, you know, if you go into a bank, you're going to see a carpeted floor and say a guy is coming off of his construction shift, he's in his work boots, if he walks across the carpeted floor, say a guy is coming off of his construction shift He's in his work boots. He walks across the carpeted floor He's gonna feel like a jerk. I don't know if he's right or wrong, but it was an interesting point And it was a conscious choice. You know, they would they would not put down carpeting Nick's also worked really hard to make his places seem just like retail

It reminds me a lot of a corner store only instead of selling chips and soda and stuff like that It's financial services and everyone patronizes and is welcome of a corner store, only instead of selling chips and soda and stuff like that, it's financial services. And everyone patronizes and is welcome at a corner store, rich and poor, and you know what, everything costs. One of the most important things, maybe the most important thing, at this chain of checkaches,

and you'll see this at a lot of them, there was a big list of prices on the wall, and it was all really straightforward. And the prices were, for the most part, the prices were too high. But you weren't going to wonder what something was going to cost. You weren't going to wonder what they could do for you. And when I talk to people who chose to go to check cashers, a lot of them had had a bank at one point. They signed up for some free checking account, but then all of a sudden they had these fees and they would like read these statements that were

pages long and they couldn't figure out where they were getting charged, what they were getting charged. Plus, you aren't paralyzed by the vast number of options available to you. If you go to your bank, chances are, you know, they'll have like five different savings accounts. They'll have five different checking accounts. They'll have all these investment accounts. They'll have college savings accounts. You know, it's a research project. It's hard to figure out which one is right for you. And I for one always seem to leave with the feeling that I picked the wrong one. The Czech cashers and payday lenders they'll have a bunch of different services, but there will only be one of each.

So you can cash your checks and it costs this much. You can wire money to your family in another country and it costs this much. It's all designed to be really simple. Let's pretend you've never been to a bank before. I think some banks are realizing that their cookie cutter, suburban branch, you know, they can't drop it down and have it work everywhere. You know, it's one thing. If you open to bank account with your parents when you were eight years old and you've been going there forever and all the weirdness of a bank, the no prices and the pamphlets and the ferns, like all

the stuff that's kind of strange about a bank when you think about it. It's just normal because that's what a bank is. Well, if you don't know what a bank is, if it's not normal, then maybe it's weird. 99% Invisible was produced by me Roman Mars with support from Lunar, making a difference with creativity. It's a project of KALW, the American Institute of Architects, San Francisco, and the Center for Architecture and Design. To find out more, go to 99%invisible.org.