Let's face it: Guarantee companies are major beneficiaries of a paper-based world. Nevertheless, and despite all the nay sayers, we are proponents of check conversion.įor every merchant objection cited above, there is generally a corresponding satisfactory answer to mitigate those concerns. What is the biggest myth of all? That consumer debiting and settlement in the ACH world is real-time. The customers are often subjected to third-party collection efforts and not offered the benefit of initially being contacted by the merchant. With paper-based guarantee, merchants generally get funded more quickly by going to the bank each day than they would be with 48- to 72-hour ACH settlement from the conversion provider.įinally, consider the goodwill issues that concern many local merchants when long-time or frequent customers accidentally bounce a check. Many merchants don't even know if they are being properly compensated for each batch unless they call their banks or access accounts online (assuming they can go online). Many merchants prefer to selectively guarantee the transactions of their choice in order to avoid paying discount fees on their frequent customers.
Heck, some of them may even sleep with the receipts tucked neatly under their pillows. Many merchants prefer (yes, prefer) to deposit their paper checks and hold, touch and caress their beloved bank deposit receipts. The control aspect is even more far-reaching. Many merchants are also afraid of "new stuff " after all, from their perspectives, if something isn't broken it doesn't need to be fixed.
#Ran world gs retrieving data drivers
In the interest of science and humanity, regarding potential fraud, when was the last time you thought about how easy it would be to obtain five bank accounts in one afternoon versus five unique, valid drivers licenses? It's simple because many guarantee companies, including Secure Payment Systems, do not require peripheral check reading devices, even though they are beneficial. That is exactly why customers still gravitate to paper-based guarantee-simplicity and control. It also does not account for the sizzle of imaging equipment sales, or the greater likelihood of guaranteeing all checks versus the age-old "cherry picking" authorization method. Paper check guarantee is certainly not as sexy and streamlined as its conversion counterpart.
Probably 80% of the guarantee deals that are written today are still the vanilla paper-based variety. I say paper check guarantee is not dead! Based on my experience, I can tell you I am not alone in this regard. Why you say? Because those shiny, new fangled picture-taking machines known as imagers, which are selling like hotcakes these days, depend on it. Take that paper check out of the trashcan-clean it up, polish it, and reuse it! Over the years, despite its success, as evidenced by the growth enjoyed by Telecredit/Equifax Check Services (now Certegy Check Services), First Data Corp.'s TeleCheck, CrossCheck, Inc., and many others (including my own company), check guarantee has nevertheless been kicked, maligned, beaten and tossed aside like an old scrap. In fact, the paper check is not only alive and well (conversion as we know it at the point of purchase actually depends on it), check guarantee-the bane of our existence-is also surviving and thriving. Well, I hate to break the news, but the king is not dead, as my colleague Steve Eazell wrote in an entertaining article last month here in this very publication ("On Life Support, Paper Checks Making Valiant Effort," The Green Sheet, April 26, 2004, issue 04:04:02).
Oing back as far as 20 years, I've heard from so-called industry pundits who to this day continue to pontificate on the demise of the paper check.