Are Cheques Hurting Your Business?
Technology is making it easier to pay people, yet many companies continue to rely on cheques as a primary form of payment.
According to Payments Canada, 553 million cheques were issued in 2017 alone, representing more than $3B in issued value. For such an outdated payment vehicle, it remained the highest annual value loaded to a single payment type.
So, what is it about cheques that makes them so appealing? Familiarity? Scalability? The assumed ease of use they offer?
Nearly 1,500 years old, this antiquated payment vehicle is starting to show its age. With more risk than reward, it begs the question of just how necessary cheques are to business operations and success. Can cheque issuance as a primary form of payment really be detrimental to your business?
An Arm and a Leg
Did you know cheque issuance is costing you an arm and a leg? Costs can be anywhere from $15-25 per cheque and they can even be as high as $50! Additionally, shipping and postage, plus fees incurred if cheques are lost or stolen, make cheques an expensive option when it comes to payouts.
Mass payments don’t have to cost so much, so why do we insist on spending unnecessarily? Not only are cheques detrimental to businesses when it comes to their high cost, but detrimental to recipients who need instant access to funds and hampers them with postage delays and bank holds. A company’s focus should be on improving their end user experience, providing funds quickly, safely and efficiently—with trackable data for future applications.
More Money, More Problems
Issuance and postage fees aren’t the only costs that companies incur with cheque issuance. Cheque fraud is the most common type of payment fraud with 75% of businesses admitting to being victims of cheque fraud in 2016 (JP Morgan). With fraud management fees and reconciliations, cheque fraud alone could be enough of a deterrent to stall your cheque issuance process.
But What’s the Solution?
Well, Visa and Mastercard’s prepaid network security has got you covered with their fraud protection guarantees. The onus is no longer on you and your company to carry the brunt of those pesky fraud issues. You should be focusing on what really matters—your clients, suppliers, and employees.
Mass payments don’t have to be chaotic, lengthy, or costly. Instantly issued prepaid cards and push payments can eliminate the stress of cheque issuance when it comes to paying out. Recipients get instant access to funds and you get trackable data for a fraction of the cost of sending a cheque.