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Turning Check 21 To Your Advantage

Posted on May 13, 2008
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In 2004 Congress passed the Check Clearing for the 21st Century Act, better known as Check 21. This allowed banks to accept the scanned image of a check in lieu of receiving the physical check. It saved the banks a fortune in transport and handling costs as well as allowing checks to “clear” within 24 hours of receipt by a merchant essentially ending the “float” depended on by both the impoverished and scammers everywhere. None of this was good for the average Joe on the street or even for micro and small businesses.

But, as it always does when given the opportunity, the market has come to the rescue once again. This time in the form of DepositNow from BankServ. BankServ has been developing electronic payments technology for more than a decade and has relationships with more than 400 banks in 52 countries around the world. In other words, these guys aren’t newbies and they’re not a fly-by-night operation looking to rip you off or likely to disappear overnight.

So what, exactly, is DepositNow? It’s both a service and a piece of equipment. The service handles all of the processing of your electronic bank deposits. Essentially you send them a digital copy of any check or money order that you receive as a payment for goods or services and they deposit said check (or money order) into your bank account instantly. The service works with any bank in the United States and with any account, so there’s no need to change where or how you’re currently banking. You’ll just be making fewer trips to the bank.

The equipment consists of a special scanner that reads the MICR encoding on the bottom of every check. The cost of these scanners has been one of the big hurdles to small businesses taking full advantage of Check 21. But DepositNow has produced a check scanner that also functions as a traditional scanner and costs only $225. With that price point this equipment is attainable for even micro businesses, such as eBay sellers. Personally I’ve avoided accepting checks or money orders when doing business on eBay specifically because of the hassle of dealing with the bank as opposed to the ease of PayPal. With DepositNow those problems are gone!

As if all of that’s not enough to motivate you to try out this service I’ve even got a special offer to make it still more affordable. DepositNow has authorized me to save you an additional $25 on the purchase of any check scanner! All you need to do is enter Philaahzophy as the promo code when you sign up for the DepositNow service.