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At least 17 million American adults have no bank accounts or credit cards, according to the FDIC. So how do they pay their bills? The answer so far: With great difficulty and expense. If they need to mail a payment, they often have to wait in line at a post office to buy a money order. Or they pay in cash, which often means time-consuming, gas-guzzling drives across town.

A company called PayNearMe is trying to change that. We ran into PayNearMe’s CEO Danny Shader at the Finovate conference this week in New York. Over the last few years, PayNearMe has built a network that allows people without bank accounts to pay bills by going to their local 7-11 store.

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There they can pay in cash, and their payment is sent electronically right from the cash register. The consumer receives a receipt to prove their payment went through.

The main problem so far is that people can’t actually use the system to pay their biggest monthly bills: Car loans and rent. So Shader came to Finovate to announce that he’s solving that problem.

“I’d rather pay my bills at a store right down the street than drive all over town,” said Nicole Amsler, head of marketing for PayNearMe. “Driving all over is inconvenient. And the companies have to handle all that cash.”

Another problem for many car buyers and dealers is that many people buy a car and then move to a different state, complicating the matter of making their car payments in cash. So in the next few months, PayNearMe will start establishing relationships with the largest “Buy Here, Pay Here” car lots (there are 24,000 such subprime car dealers across the country, Shader says).

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“We’ve talked to car dealers and they’re very excited about this,” Amsler says.

Of course, subprime car dealers have long been accused of taking advantage of consumers. J.D. Byrider, one of the largest chain of such car dealers, was forced to pay $3.7 million to 2,500 car buyers in Louisville in 2007 after the Kentucky attorney general’s office proved that the company systemically overcharged consumers.

What protections has PayNearMe put in place to prevent dealers from turning its service into another fee for profit?

“We set the prices, so they can’t manipulate them,” Amsler says. “There’s no way for vendors to slide in a fee that we don’t know about.”

Starting next month, people will also be able to use PayNearMe at 7-11 to buy Greyhound bus tickets. And the company is entering negotiations with large apartment complex owners about accepting cash payments via PayNearMe.

[Related article: Startup to Translate Financial Fine Print]

Image: Taber Andrew Bain, via Flickr.com

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