Retail Stores Charging for Cash Back: Which Stores to Avoid and Where to Withdraw Free Cash

As traditional bank branches continue to close and out-of-network ATM fees climb, retail stores have become an essential cash access point for millions of Americans. Yet this convenient service is rapidly changing. What was once a free perk offered by major retailers is now becoming a costly transaction at several prominent retail chains. A groundbreaking report by the Consumer Financial Protection Bureau (CFPB) reveals that Americans are paying over $90 million annually just to access their own money at large retail locations — a staggering reality that exposes a growing inequality in financial access.

The Growing Fee Trend: Why Major Retailers Are Charging for Cash Back Services

The decision to charge for cash back services isn’t random — it reflects broader shifts in both banking infrastructure and retail economics. The fundamental issue: as traditional banking networks shrink, particularly in rural and underserved communities, retailers have recognized an opportunity to monetize a service they once provided for free.

According to CFPB Director Rohit Chopra, “While retail chains had long provided cash back on debit card purchases for free, we have found that dollar store chains and other retailers are now charging fees for access to cash. Many people living in small towns no longer have access to a local bank where they can withdraw money from their account for free. This has created the competitive conditions for retailers to charge fees for cash back.”

The situation hits hardest in small towns and low-income neighborhoods, where dollar stores and discount retailers are the primary — sometimes the only — retail presence. For consumers in these areas, cash withdrawal fees represent not just an inconvenience but a genuine financial strain. The CFPB’s analysis specifically highlighted that people with lower incomes or limited banking alternatives face disproportionate impacts from these new charges. Retailers defend these fees as necessary to cover transaction processing costs and maintain their operations, but the reality is that vulnerable populations absorb the burden.

Four Major Retailers Imposing Cash Back Withdrawal Fees

Several of America’s largest and most accessible retail chains have recently implemented cash back fees, fundamentally changing the economics of obtaining physical currency for ordinary shopping trips.

Dollar Store Chains Lead the Fee Movement

Family Dollar and Dollar Tree, both major players in the dollar store sector, have been among the first to aggressively implement cash back charges. These two retailers operate under the same parent company, and both have adopted similar fee structures targeting small withdrawal amounts — precisely the transactions most common among their customer base.

Family Dollar charges $1.50 for cash back amounts under $50. For shoppers accustomed to quick, small cash withdrawals, this represents a significant percentage cost. A customer withdrawing just $20 faces a 7.5% fee before even using the cash.

Dollar Tree takes a slightly less aggressive approach, charging $1 for cash back transactions under $50. While lower than Family Dollar’s rate, this still transforms what was once a free service into a recurring cost for regular shoppers.

Dollar General, the largest dollar store chain by store count, has also embraced the fee model. Mystery shopping conducted by CFPB investigators in 2022 found that Dollar General charged between $1 to $2.50 per withdrawal up to $40, with rates varying by location. Given that Dollar General stores disproportionately populate rural and low-income areas, the introduction of these fees amplifies existing financial inequalities.

Grocery Chains Join the Trend with More Reasonable Rates

The trend isn’t limited to discount retailers. Kroger, America’s largest traditional grocery chain, has also implemented cash back fees, though with less aggressive pricing and higher withdrawal limits than dollar stores.

At Kroger’s Harris Teeter locations, customers pay 75 cents for cash back up to $100 and $3 for amounts between $100 and $200. Other Kroger-branded stores including Ralph’s and Fred Meyer charge 50 cents for withdrawals up to $100 and $3.50 for amounts between $100 and $300. These rates, while more customer-friendly than dollar store pricing, still represent a new cost barrier for routine transactions.

Five Retailers Where You Can Still Get Free Cash Back

Despite the growing trend toward fees, several major retail chains continue to offer free cash back services, providing alternatives for cost-conscious consumers:

• Walgreens allows up to $20 in free cash back per transaction
• Target permits up to $40 in free cash back at checkout
• CVS offers up to $60 in free cash back
• Walmart provides up to $100 in free cash back
• Albertsons allows up to $200 in free cash back

However, a critical caveat limits the usefulness of these fee-free options: these stores are not universally available, particularly in smaller towns and rural regions where banking access is already severely restricted. A resident of a small town with only a Dollar General or Family Dollar nearby cannot realistically travel to a distant Walmart or Target just to avoid a cash back fee, effectively trapping them within the fee-charging retailers’ ecosystem.

Protecting Your Wallet: Finding Fee-Free Cash Back Options

For consumers seeking to navigate this changing landscape, several strategies can help minimize fees. First, prioritize shopping at stores that offer cash back without charges when they’re available in your area. Second, consider adjusting withdrawal amounts to stay under fee thresholds where possible. Third, explore whether your bank offers any fee reimbursement programs or partnerships with specific retailers.

The broader reality, however, is that the shift toward cash back fees represents a regression in financial accessibility. As the CFPB has documented, this trend disproportionately impacts Americans with the fewest financial options — those living in underserved communities where traditional banking infrastructure has eroded. While individual consumers can strategize about which stores to use, addressing the root problem requires systemic changes to ensure that accessing one’s own money remains a right, not a privilege purchased through hidden fees.