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The Banking World Is Changing

Apr 8, 2008
You may not have known this, but the most popular method for paying for things used to be with checks and with it came a variety of different problems.

People could pay for things with money they didn't actually have and "float" the check a couple days before it actually hit their account. Many people were able to get out of financial binds this way but that is no longer the case.

Today, the vast majority of checks written are turned into digital checks immediately. That means your check really turns into a one-time debit from your account in the same way that it would if you used your debit card.

So, if the funds are not in your account at the time the transaction takes place then your purchase will be declined. You need to keep this in mind when making credit card payments and the like because you no longer have that window of time where you can "float" the check.

In fact, many companies worldwide are choosing to not accept checks anymore. This may seem extreme, but that is the way companies are choosing to go about saving money. Not only do they cost more money to process, but they also carry a higher risk of bouncing than a debit or credit card purchase.

For example, if an individual writes you a check and gives you his name, number, and license number you will be able to track him down should this bounce. But, this will occur after your bank has charged you for depositing it and it will take time and effort to track down the individual.

However, none of this will ever take place with a debit or credit card purchase. You simply slide your card and within seconds you are either approved or declined.

If approved, the funds are immediately withdrawn from your account and you no longer have access to them. If you are declined, then you will not receive the products you were trying to purchase. Nobody will be charged any extra fees and all will be well.

It is for this reason that many stores are choosing to decline checks in favor of cash, debit, and credit payments. Of course, most consumers choose to pay by these methods these days anyway.

That is because writing out a piece of paper to a company takes time and effort that most people don't have these days. Instead, it is preferable to swipe some plastic money through a machine and sign a voucher. It only takes a fraction of a second and it is preferred by most people these days.

Of course, the older generations are not accustomed to paying for anything in any other way than with a check so it is taking them a bit longer to get used to things. They are coming around though.

The banking world is changing and everyone, young and old, has to get used to the changes being made. Otherwise, they will be left behind the times!
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If planning to open a bank account then look for us. We help you with current accounts, saving accounts and with bank charges.
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