Electronic check conversion

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Electronic Check Conversion

A form of payment in which the payer writes the payee a check, but in which the actual funds are debited/credited electronically. The U.S. Treasury has used electronic check conversion to make large payments online.

Electronic check conversion.

Electronic check conversion is a payment process in which you give a payee a check, but the actual payment is processed as an electronic funds transfer.

The payment is automatically debited from your account using the account, routing information, and bank ID information on your check, which is either voided and returned to you or destroyed.

A business must notify you before it uses electronic check conversion to process your payment. Keep in mind that an electronic funds transfer will be completed much more quickly than a check, so it's important to have the funds available in your account before you authorize an electronic check conversion.

As with any other type of electronic funds transfer, you have the right to ask your bank to investigate any errors or misuses.

References in periodicals archive ?
Finally, the new rules provide businesses with the same ability as consumers to opt-out of check conversion, and provide RDFIs the same 60-day right of return for unauthorized transactions that exists for consumer check conversions.
The existing rules for check conversion allow only consumer checks to be converted.
The new rules could also lead to greater use of check conversion, particularly ARC, by making it easier for Originators to comply with the rules.
Businesses that want to opt-out of check conversion can use check stock that contains the auxiliary on-us field.
Financial institutions offering ACH Web Client create opportunities to increase non-interest fee income and enjoy a significant cost advantage over competitors that are not capable of originating electronic check conversions.
ACH Web Client incorporates a fully integrated, industry standard desktop scanner for electronic check capture and image storage for accounts receivable/lockbox conversions (ARCs) and returned check conversion (RCK).
This low reject rate, primarily attributed to the combination of the two companies' leading data sources, translates to retailers benefiting from enhanced risk management at the point-of-sale, faster check conversions through the system, reduced back office support, better reporting to the SCAN(TM) network and improved recovery ratios.
Electronic Check Conversion Solutions Provide Superior Risk
3 /PRNewswire/ -- Deluxe Corporation (NYSE: DLX) today announced it has reached an agreement in principle to acquire eFunds Corporation to provide electronic check conversion solutions for financial services companies and retailers.
The acquisition of eFunds and its electronic check conversion technology is an important strategic fit for Deluxe as a leading payments solutions provider serving financial services companies and retailers," said Gus Blanchard, CEO of Deluxe.
Stepanik added, "CheckFree's market leadership in the transaction processing industry and their track record of consistent, high-quality systems, combined with the innovative US Dataworks solutions, makes a compelling case for large corporations to process their check conversions in-house rather than use outside service providers.
This check conversion product suite will position CheckFree to offer a complete processing package from the corporate location through the Federal Reserve Banking system.