Pre-Printed Check Stock and MICR Toner Updates
Step by step, Accounts Payable experts are modernizing processes, technology, and the workplace.
How can making payments evolve?
Let’s talk about two areas where significant change began…
Pre-Printed Check Stock
First, go to your local hardware store for a physical lock and key. One of the first problems is that pre-printed checks aren’t secure. This has been a chief concern for AP departments and management everywhere. Don’t leave your company or organization vulnerable to a financial attack by those who wish to do you harm. Just because it hasn’t happened yet, it doesn’t mean it won’t happen in the future. Many customers have made that first step to stop the use of pre-printed stock and evolved to blank stock because it’s less expensive and much more flexible in use.
Immediate Benefits of using Blank Check Stock vs. Pre-printed:
Easy to use and purchase and much less expensive
No modifications for the MICR Check Format files required
Compatible across multiple companies
This topic has been up for debate for a very long time because some banks require it, while others don’t. MICR or Magnetic Ink Character Recognition is how the bank reads the account, routing and check numbers on the bottom of the check either optically and/or magnetically.
It may come as a surprise to some customers that it’s typically not needed. To be reassured, customers will print out a small batch of checks (not test checks) and then see if the bank replies with any issues. If the bank doesn’t complain, then use regular toner. You’ll be happy with this step in the evolution.
Now, get your seat belts on, because AP is moving fast into modern times…
Look to the Future
Have you photographed a check for deposit or used a virtual wallet like PayPal? Even hailing a Lyft, no actual currency is used. Most employees are paid by direct deposit, right? AP departments are seriously thinking about their efficiencies to cut down on labor and paper costs to reduce errors and improve upon performance.
One exciting development is that companies are quickly shifting gears to pay vendors electronically, even beyond EFT and ACH payments. They are evaluating costs. The typical check costs $3.00 to cut. ACH is about $0.11-$0.25 per transaction, according to the Association of Financial Professionals (AFP). AP still wants more savings.
This shift is the move to virtual cards. You might think it’s a plastic credit card with a 16-digit account number. Not at all. It’s a one-time use card with the exact amount to pay your vendors. There’s no cost and sometimes they offer rebate sharing. Imagine the AP department transitioning away from being a cost center to becoming a profit center.
There’s more... Experts in AP are constantly evaluating processes, routing, and approvals. Automation is top of mind. They are talking about how companies and organizations will eliminate paper checks in the future. It’s all about integrated payables, too.
Are you looking forward to Accounts Payable advancements? There are exciting times ahead.