The majority of businesses are turning away from advice that is, by now, common sentiment within the industry: Paper checks are slow, expensive and prone to error.
New research from AP Now revealed that 51 percent of businesses surveyed are not reducing their dependence on paper checks to integrate electronic payment processes, the company said Monday (March 21).
Its 2016 Payment Survey concluded that these companies still make 75 percent of their B2B payments with paper checks.
Further, researchers found that the businesses least in need of going digital — the companies already making a low percentage of their B2B payments with checks — are taking the most aggressive approach to implementing electronic payment tools.
Just 45 percent of businesses most dependent on checks said they want to reduce the number of checks issued. That means 55 percent are content sticking to paper and manual payments.
“This is unfortunate,” said AP Now survey sponsor Mary Schaeffer in a statement, “as paper checks are expensive, inefficient and create extra work on extra levels.”
But the research didn’t uncover all bad news. According to reports, 83 percent of businesses use ACH payments for at least some of their processes. Meanwhile, 79 percent said they have issued commercial cards for employees for the purpose of procurement and other employee spend needs.
“I was encouraged by the number of organizations who are equipped with ACH and commercial card functionality,” said the study’s lead analyst, Lynn Larson of Recharged Education, “but the usage of these two electronic payment methods definitely has room for improvement. Checks retain a stronghold in too many organizations.”
Some startups in the industry acknowledge that many businesses simply won’t budge when it comes to checks and have built their solutions around that fact.
For instance, earlier this month, a startup called Checkbook launched operations to allow businesses to send checks as they always have but to do it digitally, leading to less of a disruption in familiar payment practices.