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 Electronic Checks: A New Way to Pay
Today, merchants convert more than one million checks a month that consumers write at the point of sale to electronic transactions, according to industry analysts.
So, what are electronic checks and how do they affect you? Here's how they work:
1. You write out and give a share draft or check to a cashier at the point of sale.
2. The cashier scans the check through a magnetic ink character recognition (MICR--pronounced miker) reader that captures the account number, check serial number, and financial institution routing number.
3. The data moves electronically to a check authorization service, which verifies that it's not drawn on a closed account or that you have not written bad checks.
4. The cashier voids the check once approval comes electronically and then hands the check back to you. (Returning the check back to you is under discussion. The National Automated Clearing House Association (NACHA)--The Electronic Payments Association in Herndon, Va., a trade association and rule-making body for the 33 Automated Clearing House (ACH) associations around the U.S., recently has proposed that merchants retain checks).
5. You and merchants participate in electronic checking voluntarily. You sign an authorization (usually a receipt) permitting electronic conversion of payment. The merchant signs up and pays for the service through either its financial institution or a processing company.
6. The transaction goes to the ACH network where it's credited to the retailer's account electronically and forwarded to CSCEFCU for debiting. The check will take about two or three days to clear, the same amount of time a paper check usually takes to be approved for payment.
"It's essentially a neutral process in that the consumer is still doing the same thing; they're presenting their check for purchase and their account is still being debited in about the same amount of time for the purchase," says Michael Herd, director of public relations at NACHA.
Electronic checks also provide privacy protection. When you hand over a paper check to a clerk, 10 or more hands touch that check during processing before it returns to your credit union or to you. With electronic checking, the check doesn't travel beyond the point of sale; you take it with you after it's been approved electronically.
Put Savings on Automatic
If you think saving money is too difficult, and even have justifications to back you up, fuhgeddaboudit. We have the solutions to your saving hang-ups:
I don't have the money.
That's the standard cry from those who wait to save what's left over. It never happens. Instead, "pay yourself first." Use CSC Employees Federal Credit Union’s payroll deduction service and we'll automatically divert the amount you say, for as long as you say, to your share savings or certificate account.
For what little I can put aside, it doesn't pay.
Consistent, regular savings are the only kind that add up. If you only can start with $10 a paycheck, do that now. When you see how that works, you'll find yourself raising the ante to $25, $50, or more over time. And yes, that pays.
Payday and bill paying is too hectic to think about saving, too.
Whoa, that's a lot like excuse No. 1. The solution here: Use direct deposit at CSC Employees Federal Credit Union and your paycheck starts working--earning dividends--right away, instead of waiting until you get around to making a deposit. That saves you time and, over time, the headstart saves money, too.
But I'm paying too much on bills to save money.
Well, maybe we can help you there, too. Call one of our loan officers at 800 CSC-EFCU and we can discuss loan consolidation options. Sometimes we can reduce your interest rate, and that can reduce how much you owe and how long you'll be paying off the loan. And that, too, can pay off in savings.
The bottom line: The professionals at CSC Employees Federal Credit Union have the services and skills to help you automate your savings. Call today.
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