You might be familiar with the headache of handling a bad check. It can cause hours of lost time attempting to contact the original check writer and communicating with banks or other financial institutions. The process is daunting and costly, and might lead to an inability to afford bills or payroll in more extreme cases.
Being on the receiving end of a bounced check is like a suckerpunch to your bottom line. And yet, the majority of businesses have suffered this malady at least a handful of times. It can cause trouble and potentially impact a steady cash flow.
Did you know that approximately $50 million in bad checks are written every single day? It’s something you never want to have to deal with, but the reality is that it happens more often than you might expect. Having processes in place that can help mitigate the risk of bad checks is just one way to lessen the impact.
Another way to lessen the impact, in conjunction with improved processes, is to enlist the assistance of a check recovery service. Suddenly, you don’t have to shoulder all the responsibility for effectively collecting on bad checks.
How do these services work?
Paper checks in questions are converted into electronic transactions, similar to those made with a debit card. If funds are available or the bank allows overdrafts, the appropriate funds will be transferred to the recovery service, then forwarded to you. Financial institutions often prioritize electronic transactions, which is what makes this method effective.
A good check recovery service will have a firm grasp on banking procedures and consumer behavior, allowing them to time electronic re-presentment requests in order to maximize the chances of collection. Many of these services use unique algorithms to strategically determine the best day and time for re-presentment.
Successfully collected funds will be automatically transferred into your business’ account, without you having to take time away from business operations in order to handle the situation.
Bounced checks are no one’s cup of tea. But the ability to submit bad checks to a check recovery service frees you up to focus on your business, saving valuable time and effort.