Walmart will turn tax refunds into immediate green this year by offering cash refunds at all of its stores, the retailer said Tuesday.

Walmart is partnering with 25,000 tax-preparation locations in all 50 states to give consumers the option to receive their tax refund as cash, and at a lower price than it can sometimes cost to get a paper check refund. Walmart won’t charge customers to pick up their refunds, but tax preparers could charge up to a $7 fee to filers who opt for the service.

Cash Tax RefundsThe big box retailer is billing its latest financial foray as offering the convenience of direct deposit — cash refunds will be available in roughly the same amount of time it takes for a direct deposit to show up in a filer’s account — while doing away with the hassle of cashing a check. The “Direct2Cash” program is meant to target the millions of consumers who still opt for check refunds, says Daniel Eckert, senior vice president of services for Walmart U.S. Last year, more than 25 million people received their refunds as paper checks, according to Internal Revenue Service data.
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Eckert points out that for the underbanked, cashing checks can cost upwards of $70 in fees. Choosing to receive your refund as a check can also sometimes cost more than other options. The Direct2Cash initiative means “you’ll go home with more of the hard-earned money you’re entitled to,” Eckert says. Cash refunds will be available up to $7,500.

The tax preparers who offer the service will have a built-in option in their filing software for Walmart cash refunds; the program is only available to filers who go to a tax-preparation office in person. Filers will receive a confirmation code via e-mail when their refund is ready for pickup and will have to confirm their identity in stores. The option will be available for both federal and state refunds.

Consumer advocates praised the program as a consumer-friendly alternative for people who don’t have access to typical banking products.

“Initially, this looks positive for people who are unbanked, because it keeps them from falling into the hands of these very expensive check-cashing locations,” says Bruce McClary, spokesperson for National Foundation for Credit Counseling.

Cash refunds also mean financially-strapped households have more flexibility, says Karen Andres, vice president of network engagement for the Center for Financial Services Innovation. “Getting access to money faster makes a big impact for many underserved households in the U.S.,” she says.

Though McClary says that the temptation to spend the refund on the spot will be hard for many to resist.

“You’ve got a pocketful of cash, and you’re standing in a very large retail store,” he says. “It’s really going to be a test of willpower for a lot of people who don’t have tight control on their spending habits.”

But that may be part of the point. The announcement is the latest of a string of services Walmart has rolled out in the financial services sector that bolster its position as a one-stop shop for customers to both complete financial transactions and spend the money they collect on Walmart merchandise. This year, the retailer is making it even easier for customers to linger in stores or show up after filing. Jackson Hewitt, which operates more than 3,000 of its 6,300 locations inside Walmart stores, is offering a $50 Walmart e-gift card to those who file in person by March 31. E-filers will get a $20 Walmart gift card.

“It’s always a good thing to have customers in our stores that have jingle in their purses,” Eckert says.

Walmart has offered tax-preparation services in stores for nearly 10 years. This year, more than 3,000 stores will have Jackson Hewitt tax professionals on hand to help customers file; about 300 stores will have Liberty Tax Service.

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