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    3 Replies Latest reply on Apr 5, 2013 5:16 PM by amspcs

    How do you handle returned checks?

    Moderator Berta Guide

      Returned checks are a problem all businesses face. The SBC is taking a poll to see how businesses are handling this situation in the current economy.

       

      Please take a couple of minutes to answer the SBC Poll and check the results!

       

      Thanks,

       

      ~Berta

        • Re: How do you handle returned checks?
          amspcs Ranger

          Interesting question.  Before I entered the payment processing business, I spent many years consulting small businesses on many issues.  One that came up very frequently was the subject of accounts receivable management.  The REAL answer to your question is to avoid or minimize returned checks in the first place, not wait for the problem to happen and then deal with it.  There are tools available to small businesses for just this purpose:  Accept e-checks and/or debit cards instead of paper checks, utilize check guarantee/verification/truncation (three very different services that merchants often confuse, mis-identify and mis-use), just to name a few.

            • Re: How do you handle returned checks?
              Guide

              Honestly, how to handle bounced checks also depends on your bank. There are several different fees that a company can be charged depending on the action you take.

               

              We accept our fees for services in installments which makes it easier on the client. This cut down on the amount of bounced checks for us.

               

              Melinda

                • Re: How do you handle returned checks?
                  amspcs Ranger

                  Melinda, everything you say is absolutely correct.  But I fear  you are missing my point entirely.  To focus on the fees relating to NSF checks completely ignores the big picture of trying to turn a lose/lose situation into a more positive outcome.  By that, I mean, whenever a business enters into 'collection mode' with a customer, even if they successfully recover their moneys they STILL have created negative vibes with almost always result in a lost customer---and THAT is the big picture loss one needs to look at.  I think it is far smarter to avoid the situation entirely than to wait until it happens and THEN try to deal with it.  And as far as installment payments go, all one accomplishes is turning one potential negative situation into multiple negative situations.  Plus, have you stopped to consider the true costs of collecting the same bill multiple times???  I'm talking about the lost productivity of the employee on salary who has to spend valuable time preparing and sending out statements, making dunning phone calls when the payment is late or the "stamp fell off" card is played, postage expense, etc....payroll hours that could and should be better spent on other tasks.  If you're going to do installment payments, do yourself a HUGE favor and set up AUTOMATIC recurring credit card or ACH echeck payments that take care of themselves.  These services cost mere pennies in comparison to the real costs of collection just discussed.