check payments

It is definitely good business to offer your customers a variety of options for making payments. These options can include payment plans, using credit or debit card, online payments, checks, cash and non-cash payments, money orders, cashier’s checks, automatic withdrawals, etc.

As one book author quoted, “People tend to resist that which is forced upon them. People tend to support that which they help to create.” A company that collaborates with his potential customers by providing support, positive reinforcement and conflict resolution will net incredible results. One way to achieve this is by providing your clients payment options that would suit their needs.

To conclude that too many choices are bad, is just as wrong as to assume that having more choices is always better. It will always depend on what information we are given as we make those choices, the type of expertise we have to rely on, and how much importance we ascribe to each choice that we make.
While non-cash payments are an imperative for eBusinesses, accepting non-cash payments improves sales by eliminating the need for potential customers to ensure that they have sufficient cash on them to make a purchase. By offering non-cash payment acceptance methods, a business can improve average transaction value by allowing customers to exceed their planned budgets or available funds (credit cards for instance) and make spontaneous purchases (buy now, pay later by simply handing over a check at the time of purchase).

Over the past year, new Key Regulatory and Industry Initiatives (KRIIs) have emerged across the world, focused on increasing consumer convenience, improving payments security and transparency, strengthening fraud prevention, and stimulating innovation.

New and legacy players are developing and delivering a multitude of innovative services, offering an opportunity to target future investment areas.

Making the right choice – Checks? Cards? How about BOTH?

Once you have decided to adopt non-cash payment acceptance for your business, the next question is whether to offer check acceptance, card acceptance, or both. If you wish to move towards non-cash payments in stages, then the decision as to which type to implement will depend on the nature of your business. For a business looking to also sell on the web, credit card processing may be an imperative, while for a financial consultancy firm, accepting checks may be the preferred mode of payment.

Since payment via cards is more convenient than carrying bulky check-books, and the fact that card companies today offer rewards and benefits to customers who use their products, means that people are more likely to be motivated to carry and use cards as opposed to check-books. For businesses, there are fewer risks associated with an upfront payment via a card swipe, compared to a check payment where the confirmation of payment or clearance may take 2-3 days.

On the other hand, checks are the longer-established payment method. It is believed that they were first used in the US in 1681, while payment via cards has only been in existence since the late 1940s. Until a few decades ago, using cards as a payment medium was limited in terms of customer base and merchant acceptance. This also means that today’s senior generation is most likely to have grown up using checks, and just adopted cards much later in life (if at all), whereas the younger generation is likely to be accustomed to using cards for payment. Therefore, a healthcare center treating problems associated with aging is better off adopting a check payment system first, versus a garment retailer who would rather go with card processing.


Looking to the Future

According to a 2010 study carried out by the US Federal Reserve, the use of checks has declined from 32% of all non-cash payments in 2006 to 22% in 2009. The same study showed that debit card usage had increased from 26% of non-cash payments in 2006 to 35% in 2009. It is however interesting to note that checks are still ahead of credit cards as a form of non-cash payment, although the gap has decreased from 9% in 2006 to 2% in 2009. This suggests that while card payments may be the method of the future, check payments still carry weight in the here and now.

Checks are still a simple and effective method of non-cash payment which businesses should continue to support. Having this option will make purchasing easier for your clients, thus leading to more sales and growth for your business.


What type of payment does your business process? Let us know in the comments below.