While Americans might not be privy to carrying checks anymore, it doesn’t necessarily mean checks are dead. In fact, paper checks still have their place in the financial zeitgeist.
But with so much of the world migrating to fintech and cryptocurrency, it might be difficult to conceptualize where checks fit within the system of the future. Still, generations such as the Silent Generation can still appreciate the value of a check. Businesses also still need checks for things such as payroll and sending checks by mail.
In this article, we’re detailing the place for checks in our modern financial system.
Some Numbers
Even though Millenials and Gen Zers are less likely to use checks than older generations, there are plenty of ways to utilize checks. While a recent GOBankingRates survey showed 45% of respondents haven’t written a single paper check in the last year, 23% responded they have written one in the past month. And of that 23%, the single check is most likely for rent or a mortgage payment. So while checks aren’t used as widely, they have their palace for large purchases. It’s also possible to use cards for large purchases but these typically cost substantial fees.
Rent and mortgage payments aren’t the only reason to use checks. A Mercator survey found that 47% of users utilize electronic checks when card payments aren’t an option. So, even if paper checks diminish, electronic checks might be a viable option.
Why Are Paper Checks Dying?
There are several reasons for the death of the paper check. To start, credit and debit cards already rendered personal checks somewhat obsolete. But with mobile wallets and tablet pay stations, personal checks are fading further into the distance. Why carry a checkbook when you can consolidate all your payment options on one device?
Electronic payments are easier at home as well. 84% of American households have a computer and why would you fumble with an envelope and the mail when you can receive immediate confirmation of your payment with electronic methods? The bottom line is that paying online is faster and cheaper than mailing a check.
Businesses are also encouraging automatic payments and investing in the infrastructure that facilitates these methods. Banks prefer electronic checking because it features less risk. They can monitor these payments closer and provide reliable and predictable customer service.
Digital options are not only more secure. They’re faster as well. If you live paycheck to paycheck as most Americans, it’s easy to see why you might need a quick option to pay your bill. Digital options provide that opportunity.
Bottom line – Are Checks Dying?
The usage of personal checks is certainly waning. But that doesn’t mean it’s dead. There are still cases where personal checks make sense. For example, check printing services can simplify payroll functions for companies.
Though there are still cases to be made for the tangibility of a check, fintech and cryptocurrency are at the forefront of the financial revolution and will likely render paper checks obsolete in the future. Still, electronic checks might have their place and it’s wise to learn more about what electronic check companies can do for your business.
