11/07/2024

Paper Check Fraud’s Weakest Link Is … the Paper Check

PYMNTS

Given the chance, most consumers will choose digital payments over paper checks. Yet the check endures, expensive to make and mail and manage, and they often sit uncashed at the back of a drawer for weeks and even months.

And yet, as Rusty Pickering, president and chief operating officer of Ingo Payments, recently observed, there’s no great mystery behind their staying power, even though, when all is said and done, it can cost between $3 to $8 to create a check and ultimately send it on its way.

“Even with all its flaws,” he told Karen Webster, “it’s the only universal payment instrument — universally available to send and to receive. … I don’t need anything more to pay you by check than your name, a physical address,” and the amount of the payment. As to where the stickiness lies: In the post-pandemic age, while it may be true that consumers are writing fewer checks, businesses are in fact still enamored with them, as 80% of firms still process and mail paper checks to other firms, and especially when paying consumers.

But, amid $8 trillion in volume done in pen and ink, and sent via post:

“The weak link in payments is the paper check,” he continued, “because when you stick it in the mail, it’s susceptible to being stolen.”