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New Check Acceptance Solutions Increase Business While Avoiding Fraud

What if businesses could accept a check just like a credit card? The answer is to implement a program that allows the customer to pay by check, and treat them in the same way as you would a credit card paying customer. And, what if a business could tailor check acceptance solutions they needed that was specific to solving a payment solution for their vocation?  For example, if you have an automotive transmission shop, and a customer’s transmission fails, it is an unexpected expense, and costs thousands of dollars, which can be well beyond the credit limit on the customer’s credit card.  The customer may not have the monies readily available to pay to have a new transmission installed in their vehicle. The same situation is true in a bereavement situation where the family has to pay for an expensive funeral, because a death came unexpectedly.

The answer to all of these problems is for the business to also have a check acceptance service provider, just like their credit card service provider. And, to tailor the program so that the Client can pay the business in a 30-60 day period, so that the business does not lose the sale, while allowing the Customer to be able to finance the unexpected expense at no cost to them.  Being able to accept a credit card just like a check allows the business to accept In-State, Out-Of-States, and Canadian checks, with a Drivers License, State I.D., or Military I.D.

Financing a sale for 30-60 days becomes particularly attractive to auto dealerships.  Let’s say a husband and wife comes into the showroom and the husband gets paid on the fifteenth of the month, and the wife gets paid at the end of the month. The couple finds the car that they have been looking for all over the place at a price they can afford. However, like about 30% of the population, they don’t have a credit card. The check acceptance solution solves everyone’s problem, as the couple can now finance the down payment on the vehicle.

The risk of accepting a credit card is that the business can be defrauded. Even new chip-based credit card terminals can’t overcome a clever criminal who simply tampers with the magnetic stripe on their credit card so that the business has to enter in their credit card number manually.  If it turns out that the credit card has been lost or stolen, the new credit card terms and conditions do not protect the business from having no recourse from the credit card company that does not reimburse them because the credit card was not swiped and accepted.

To highlight other vocational industry specific payment problems, if a family has a sick pet that needs to be rushed to the veterinary hospital, when they find out that it will take an operation to keep the pet alive, the parents may not have the funds readily available, and certainly do not want their children to think that they didn’t want to put out the money to keep the family pet alive. Conversely, if any service professional such as a veterinarian or a dentist encounters a new customer that they have never seen before, how do they know that the customers check is not going to bounce?  They don’t.  The check acceptance solution pre-authorizes payment to these business professionals before services are rendered. And, the cost to the business is comparable to accepting a credit card. Yet; there is a big difference.

When you are a business and you accept a credit card, you are at risk that your Client will calling their credit card company to dispute the charges, after services have been rendered. This is called a credit-card chargeback.  For example, in the case of the family that the sick pet that had to go to the veterinary hospital, if the pet dies in the care of the veterinary clinic, this is a real possibility. Yet; services were rendered.  Alternatively, in the case of the check acceptance program, if the Customer puts a “Stop Payment” on the check, the check acceptance service provider covers the amount of the sale. Automotive muffler shops are notorious for having their Clients issue “Stop Payments”. This check acceptance solution eliminates the risk to the business because they know they are going to get paid.

Some businesses such as wholesalers and distributors receive orders all day long from retailers they may have met at a trade show, many of whom may be new Customers.  It is common practice for businesses to ask the new retailer for a credit application. And, then; to extend them credit terms of Net-30.  This common practice is seriously flawed. First of all, let’s say that you have an automotive parts distributor who is selling clutch-kits. If an automotive repair business has an auto up on their rack, they don’t have time to complete a credit application. With a check acceptance program, they can have their clutch-kit shipped C.O.D. (Check-On-Delivery), by having the business provide their telephone number for authorization of the business-to-business transaction, and to be able to ship the product to the customer the same day they made the request, allowing them to not lose the sale, and to befriend a new client.

Finally, many businesses are located miles from their nearest depository Bank, such as businesses located on the highway, or in a recreational area.  They have hesitated in accepting checks because they don’t have the time to go to the Bank to deposit their check.  Or, they may be so busy during the day that they don’t have time to accept checks and go to the Bank.  This problem is overcome by having the check acceptance service provider consign an electronic conversion terminal to their business at no cost. This allows them to accept a check from their customer and have the check converted into an ACH/Debit transaction at the point of sale, eliminating the problem of going to the Bank.  This solution is particularly attractive to any lodging or campground facility, as this ACH/Debit solution acts as an ATM Machine, allowing them to advance monies to their valued guests, and be guaranteed payment by the check acceptance company.  All of these check acceptance solutions say, “We Trust Our Customer”.

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Ron Feldman
Ron Feldmanhttp://www.worldbusinessservices.com/
RON has been recognized by Who’s Who In California and Who’s Who In Lodging. He has taught Business Services Marketing at the Undergraduate and MBA University levels. Feldman holds an undergraduate degree in Mass Communications, as well as a Masters Degree in Educational Psychology. Feldman previously had been retained as a consultant twice by a major publicly traded NYSE payments industry company to re-engineer their order processing, and restructure their telecom costs, as he had done for the Clients of the second largest Utility Auditing Company in the World. He has saved businesses and organizations millions of dollars in performing Utility Audits, since 1994. He was also retained by another NYSE Retailer to advise them in regards to their payment solutions for their customers. Feldman received a U.S. business method patent for a transaction processing technology focused on the hotel industry that he invented while working with Citicorp in developing their global multi-party settlement system in the late 1980’s. During that era, Feldman worked with SITA/Sahara, a global Internet-based organizations of airlines and hotels, and was formerly Vice-Chair of the Association of Travel Marketing Executives. Feldman has represented the United States in the World Championships of Tournament Bridge in 1982, 1986, and 1994. He founded the first accredited organization of Professional Bridge Players. Feldman also served on the National Conduct and Ethics Committee of the American Contract Bridge League (ACBL), as well as its National Marketing Committee. He resides in Petaluma, California in the Sonoma Wine Country.

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