How Much Does Check Processing Cost?
A check is one of the several modes of payment that can be accepted when we pay for merchandise or services. While cash used to be the most popular form of payment, cradit cards are quickly replacing cash and checks as the preferred payment method. In the past, check payments were not as popular since they would have to physically bring the check to a bank. Checks now can be processed electronically which makes the transaction faster; whenever the checks are processed electronically, the check is converted into an electronic funds transfer.
How much is it?
- Check processing fees depend on how large the business is. There are several ways to process the checks, such as check by phone or check online. These processes can cost differently depending on the type that your company chooses.
- Check processing can usually be done either over the phone or on the internet. The fee for the processing of checks through phone can cost anywhere from $10 to $55 per month for small businesses. An enterprise can also avail of check processing by phone, and it can cost anywhere from $15 to $70 per month.
- The cost for having checked process through the internet for a small business can start at $30 per month while an enterprise package can start at $50 per month, and specialty risk businesses can cost $97 per month.
- For example, MerchantServices.com is an online company that provides check processing services. They charge a monthly rate which can start at $5 to $8 per month over the phone, while online processing can cost $1 to $2 more. They also offer other services for free, which can be very attractive to potential clients.
What is going to be included?
- The company that will be providing the service to you will provide several tools to make sure that all of the transactions are recorded for future reference.
- Some features included with the service that will be provided to you are emailed notifications, the ability to void pending transactions, and more.
- A virtual terminal will also be provided to key in the check information. This information will then be relayed to the company that processes the checks.
What are the extra costs?
- For each transaction made, there will be a corresponding processing fee that will be charged. The price for the transaction depends on the amount written in the check as well as the size of the business.
- An application fee will also be required, which can cost anywhere from $25 to $75 depending on the company that will provide the service.
- Some companies will charge a maintenance fee which is separate from the monthly fee.
How can I save money?
- Check for different companies that provide check processing services and compare their rates as well as their features and capabilities. The most value for your money is what you are looking for; be careful that you do not choose a company that can offers their services for less but does not offer as many useful features.
- Discounts can be offered to those that have a higher volume each month. If you know you are going to do a fair share of volume, be sure to inquire about these types of discounts.
- Consider other alternatives such as ACH processing. This is a great way to accept the checks electronically rather than handling paper checks.
- Many small, privately owned businesses and restaurants simply advertise to their customers that they do not accept checks. While this may cut down on some business that you receive, it may also save you money in the long run.