According to the Federal Reserve’s 2013 Payment Study, overall check payments have declined over the past 10 years. While check payment decline isn’t breaking news or surprising for most people, it’s compelling to look at check payment usage among the growing number of payment options available today. So, the question remains, what does the futurehold for the humble paper check?
Who’s Still Using Check Payments?
There are a variety of ways that checks are used today:
- From one person to another (Consumer to Consumer)
- From a person to a business (Consumer to Business)
- From a business to a person (Business to Consumer)
- From one business to another (Business to Business)
Out of these check-writing segments, the most rapid decline in check payments has been from consumer to business while the slowest decline has been in the business to business category. The paper check is still the chosen payment option for companies to pay their bills. Since Check 21 legislation passed allowing paper check payments to be processed electronically, checks are now stronger competitors with other electronic payment options. The Fed’s Payment Study estimates that 18.3 billion checks valued at $26 trillion dollars were used as payment in 2012. During that time, it was noted that checks were being written for higher amounts per check, increasing from $1,291 in 2009 to $1,420 in 2012. This value increase creates a new significance for paper payments. According to a report published by EconSouth, “The value of check payments still represents one of the largest values in payment types.” The overall decrease in usage doesn’t necessarily impact the relevance of checks. There may be fewer in quantity, but they are increasing in value.
Long Live Check Payments
Using check payments as an option isn’t going away anytime soon based on processing innovations and necessity. And regardless of how check processing has evolved on the back end, the front end of the issued paper check must include the required MICR line and must be printed with MICR toner.
To comply with these Federal Reserve requirements, it is important to ensure that you are using a quality check-printing solution. To help your business avoid check reject fees and reduce your fraud risk, implement a secure MICR check printing solution that utilizes blank check stock, a MICR printer and check printing software. With a secure check printing solution, you can expect to:
- Cut paper costs by 80% by using blank check stock instead of pre-printed check stock
- Reduce the time it takes to produce secure documents or custom check payments by 75% using a MICR check printing solution
- Eliminate the risk of human error that can lead to check fraud or check reject fees
- Reduce audit fees with automated check payment issuance using a secure check printing solution