Wait. Are you really still paying via check?

Written By Elizabeth King

In today's digital age, writing and mailing a check might seem like a relic of the past. Yet, many businesses and individuals still cling to this outdated method of payment. But is it really worth the hassle? Let's break down the hidden costs of paying by check:

The Price of Convenience (or Inconvenience, Rather)

  • The Check Itself: While seemingly free, checks do have a cost. Banks charge fees for ordering checks, and businesses incur costs for check printing and storage. (0.25-1.0)

  • The Envelope: Every check needs an envelope, adding to the overall expense. (.05-.15)

  • Postage Stamps: Mailing a check requires postage, further increasing the cost. (.73)

  • Bank fee: The bank charges you to process checks written on your account. (.10-.5)

  • Time is Money: Writing, signing, and addressing a check takes time. Time is a valuable resource, and this manual process can significantly impact productivity. (priceless)

  • Error Prone: Check writing is prone to errors, such as incorrect amounts or payee information. These errors can lead to bounced checks, returned mail, and costly reconciliation efforts.

  • Security Risks: Checks can be lost, stolen, or forged, posing a significant security risk.

The Modern Alternatives

  • Credit Cards: Credit cards offer several advantages over checks. They are:

    • Free: Most businesses don't charge extra for credit card payments.

    • Convenient: Online payments and mobile wallets make transactions quick and easy.

    • Secure: Robust fraud protection safeguards your funds.

    • Rewards: Many cards offer rewards programs, allowing you to earn points or cashback.

  • ACH Payments:

    • Low Cost: ACH payments have minimal processing fees.

    • Automated: Schedule recurring payments effortlessly.

    • Secure: Securely transfer funds directly from your bank account.

The Bottom Line

Paying by check in today's world is an expensive and inefficient practice. The hard costs can be anywhere from 1-2 dollars per check on top of the amount of the check. The hidden costs of checks, including time, and potential risks, far outweigh the minimal or non-existent costs associated with modern payment methods like credit cards and ACH transfers.

It's time to modernize your payment methods. Embrace the convenience, security, and cost-effectiveness of digital alternatives.

If his article interests you or you would like to discuss other treasury automations to make your business run better reach out to Lucky Grove Bookkeeping at LuckyGroveVT@gmail.com or visit our website at Luckygrovebookkeeping.com     

Elizabeth King