Half of all businesses, especially small businesses, still use checks in a time when check fraud has grown to be more rampant than ever. Fewer individuals are writing checks, but the amounts of business checks are often in the thousands of dollars range. Business checks often have larger balances, as well, and are oftentimes not monitored as well as individual accounts. This makes checks an easy target for skilled criminals, according to this news report.
These wrongdoers know how to sift through the mail, find checks, and capitalize on the information within. Not only do they know how to wash checks, which is the process of erasing the payee and dollar amount and replacing it with new information, but they are trained on how to break into postal facilities. Many are trained on how to walk into a bank without looking suspicious to cash a fraudulent check. While banks and their staff are trained on how to spot and stop check fraud, they still don’t always catch it.
Statistics show that banks reported approximately 680,000 cases of check fraud to the Federal Crimes Enforcement Network in 2022, nearly double the volume of check fraud banks reported the year before. The U.S. Postal Inspection Service also noted a major uptick in mail theft, with 300,000 cases reported in 2021. With cases of check fraud so high, why are businesses and individuals still using physical paper checks?
Paper checks were a gold standard of payment for years. Many older people still prefer to use checks and are comfortable with sending them in the mail. Businesses tend to use paper checks because they leave a paper trail for accounting and taxes. Checks are simple to use, process, and stop, all of which are necessary for complex business payment processes. Checks are also cost-effective, without processing fees.
Even with benefits such as lower processing costs and easier bookkeeping, paper checks are still subject to blatant fraud.
How can businesses avoid check fraud but still issue checks?
The answer is simple: e-checks. When e-checks first debuted, many consumers and businesses were skeptical. Now, they are embraced as a flexible and safe payment processing method. Check fraud can be nearly eliminated with the adoption of e-checks, giving businesses and their clients and customers a way to safely conduct transactions.
- Checks have a paper trail of sorts – it’s more of a digital paper trail. They can be easily accounted for and give bookkeepers the same information they need in order to complete financial records. This is accomplished without the need for mailing a check at all, thereby eliminating the possibility of a criminal locating a written check in the mail and using it for fraudulent purposes. Identity fraud and theft are drastically reduced when e-checks are in place.
Not only are e-checks safer than physical checks, but they are also more versatile. With an e-check, the recipient can choose to print their check from the comfort of home for either mobile or branch depositing. In some cases, e-checks can even be digitally deposited directly into a bank account. If you would like to cut out trips to the bank, e-checks can help.
E-checks can help businesses save money because they eliminate the need for buying and mailing checks.
Check fraud is on the rise. Stay safe and start using e-checks.
According to the American Bankers Association, check fraud is on track to reach $24 billion this year. People who commit check fraud are highly sophisticated in their tactics and often belong to rings of organized crime. If you haven’t been a target of check fraud, then you very well could be in the near future.
The good news is that sites like OnlineCheckWriter.com are available to help you transition into using e-checks. Such platforms offer instant, flexible payment solutions centering around e-checks. Users get to enjoy a variety of options for getting paid, including ACH, printable e-check, and more. Check them out to see how you can start using e-checks while reducing your odds of being a victim of fraud!
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