Under the Banking Rules (NACHA Operating Rules) Consumer checks can be converted into electronic payments.
In general, the types of questions that customers are directing to their banks come in these categories:
Finding the transation on the monthly account statement - The transaction will be listed in the electronic transactions section, along with other electronic debits, ATM withdrawals, Direct Deposits, etc. The name of the company to which the payment was made, the date, the amount and a telephone number will now appear on the account statement.
Where's the check - Some customers will want to know what happened to the checks. The original check was intentionally destroyed during the OfficeTellerTM clients' processing to prevent duplicate processing and to protect the privacy of the personal information on the check. The customer can request a copy of the check from the OfficeTellerTM client, which we are required to keep for two years. Customer's banks can also request a copy of the check.
Proving payment was made - Some customers keep cancelled checks to prove a payment was made. Since the periodic account statement now has the name of the payee, it serves the same purpose. Customers concerned about proving that certain payments were made can be advised to retain their periodic account statements.
Consumer Authorization for Electronic Check Conversion - Mere Notice in a conspicuous manner is all that is necessary. The customer does not have to agree, in writing, to have his checks converted into electronic payments by an OfficeTeller client. This is different from the other ACH / EFT Electronic Check transactions; with the Point-of-Purchase (POP) the customer gets his check back and signs an authorization; in an Internet-initiated (WEB) or telephone-initiated (TEL) electronic check transaction, the customer provides the routing and account number, rather than presenting the actual cehck to the OfficeTellerTM client. In these three transaction types, it is far less likely that the consumer will have missed reading or reviewing the authorization notification.
OfficeTellerTM strongly recommends NOT ALLOWING CUSTOMERS TO "OPT OUT OF THE SERVICE"!. As noted above, customers can request a copy of the original check from OfficeTeller, which we are required to keep for two years.
Privacy - Some customers may be concerned that the check conversion process gives the billing company the ability to access their account in real-time or to determine their account balance. This is simply NOT THE CASE. The check payment is simply being processed similar to the way an employer processes a Direct Deposit rather than a paycheck.
Consumer Frequently Asked Questions - Click Here
Four Great Sources for Consumer Information
A new website - Electronic-Check.org - is now available to provide consumers with useful and accurate information to understand the e-check payment process, as well as their rights when they use e-checks.
The Federal Reserve Boad has published a brochure entitled "When is your Check Not a Check" Print-ready files can be downloaded form this site.
The Federal Trade Commission has posted consumer information about electronic checks.
The c2ec has developed materials to explain check conversion, and has provided the nation's financial institutions and billing companies with materials that can be used to educate consumers about check conversion.