ACA International, an association representing credit and debt collection professionals posted a news article regarding the launch of same day ACH, but also reminded readers how much check writing still occurs in the U.S.:
Results from a survey by Credit Research Foundation in partnership with NACHA released in June show the use of checks is declining while electronic payments are on the rise.
“Credit and account receivables professionals anticipate that ACH transactions will surpass checks as the leading form of payment received from business customers by 2020,” according to a news release on the survey. “Currently, checks account for almost 50 percent of payments (down from 63 percent in 2014); ACH 32 percent (up from 22 percent in 2014), cards 11 percent (up from 8 percent in 2014), and cash and wire 8 percent (up from 7 percent in 2014). By 2020, respondents anticipate that ACH will account for 45 percent of payments, checks 34 percent, cards 12.5 percent, and cash and wire 8.5 percent.”
So why would are businesses still conducting 50% of their payments through checks and not through electronic means like ACH? We often forget that not all businesses are risk qualified for initiating ACH or find these services cost prohibitive:
Barriers include having customers that are not capable of sending ACH payments, according to 45 percent of respondents. “Another 34 percent say that their customers can send ACH payments, but do not properly send remittance with the payment. And another 21 percent suggest that their organizations do not have the proper systems and/or resources to effectively use ACH,” NACHA reports
Overview by Sarah Grotta, Director, Debit Advisory Service at Mercator Advisory Group
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