There goes one argument for why corporations should ditch the check.
The paper check is often called out for its cost burden on businesses, with costs hitting as high as $9 per check, according to analysis from NACHA. One company that launched operations on Tuesday (March 1) is removing this particular pain point from the enterprise.
Reports by TechCrunch said Checkbook is now off and running, providing consumers with a way to send checks for free — up to 50 a year, actually.
For businesses, Checkbook charges just $1 for them to send a check. “That’s exceedingly cheap and easy,” the site pointed out.
It must be noted, however, that the high costs associated with checks are often linked to cutting physical, paper ones; Checkbook facilitates the sending of electronic checks, which cuts down on costs.
Users can fill out the information on a digital check and send it to a recipient using only their email address. Recipients can then deposit that check into their bank account online, or they can print it out.
Reports by TechCrunch cite a cost of between $7 and $16 for businesses to send a check, according to research in the AFP Payment Cost Benchmarking Report by Aberdeen Group and Bank of America. But for businesses to accept a check, it costs just about $1.50.
This could be a game-changer for buyers and suppliers unwilling to ditch the familiarity of the check format. Researchers found that, in 2013, $30 trillion worth of checks were sent between businesses; it cost those companies $25 billion a year, however.
Checkbook operates over the Check21 and ACH infrastructure, reports said, and separates itself from other electronic checking services by streamlining the online deposit process for recipients, according to reports.
Like Venmo, Checkbook hopes that in offering its service for free to consumers, businesses will soon follow suit, considering its popularity, the startup’s founder PJ Gupta, told the site. Venmo is reportedly charging businesses to use its mobile P2P money transfer service, while keeping itself free to individual consumers to use.