5 Reasons Why B2B Companies Should Not Accept Paper Checks

Paper checks have long been a popular and universally accepted form of payment, especially in the B2B market. But checks take days or even weeks to clear, slowing collections and putting a crimp in your cash flow. Worse, an accounts receivable (AR) process heavily reliant on checks leaves you and your customers vulnerable to check fraud.

Thanks in part to accounting automation, there are better options are available.

Here are five reasons why B2B companies should reduce the number of checks they accept from customers: 

1. Risk of check fraud

Check usage may be declining but check fraud is rampant and growing faster than any other form of financial deceit. Of the more than 500 treasury practitioners who took part in the Association for Financial Professionals' latest fraud survey, 63% said their organizations were affected by check fraud in 2024. A primary reason is checks are easy to steal - 23% of companies hit with fraud said checks were simply swiped from a mailbox.

After stealing checks, fraudsters perform what's known as check washing. They chemically erase the information and rewrite the checks payable to themselves while sometimes increasing the amount. Not only does this compromise your customers’ finances, but it prevents you from receiving the money you’re owed while destroying your relationship with the customer. 

At Bill360, we provide your customers 24/7 access to a portal where they can set up their own digital wallet and make payments via ACH and with credit cards. Not only do these methods get you paid faster, but they are far more secure than sticking a check in an envelope and hoping it arrives.

2. Increased administrative burden

Accepting paper checks means members of your team need to open envelopes, deposit funds, and update your customers’ files. It doesn’t sound like much, but over time, these mundane accounting tasks prevent your employees from completing creative and strategic projects. Manual labor also heightens the chance for errors, which causes confusion and erodes your relationship with customers. 

Accepting digital payments enables you to automate your accounts receivable process, which reduces human error and frees up your employees while making your entire company run more efficiently.  

3. Excessive costs

Saving money is paramount when owning a business as it enables you to grow, stay competitive, and sustain profitability. By accepting checks, however, you’re doing the opposite – the cost of issuing a single business check ranges between $4 and $20.

The AFP reports the median cost of initiating and receiving an ACH payment was $0.40. These numbers clearly illustrate how much you can save through digital payments – and how much it costs your business to accept checks.

4. Stifled cash flow

When a customer pays by check, it often takes two to three days for that check to clear – not including mail time. Time to clear can also vary depending on each bank’s hold policy. Holidays and weekends play a role too. Other mishaps can occur, such as customers forgetting to sign the check, writing in the wrong dollar amount, or committing other typos. All of this hampers your ability to get paid and funnel those funds right back into your business. 

Payments made through ACH or with debit and credit cards are faster and more secure, especially with set-it-and-forget-it features like AutoPay, which simply transfers funds from your customers’ accounts to your account automatically.

5. Difficult to scale

There’s no greater thrill for a business owner than watching their customer base grow. However, the last thing you want is to overwhelm your staff. Accepting checks does just that – the more clients who pay by check, the more manual labor is needed to deposit and reconcile the checks, and the more room you may need to store and file them. 

Automating your AR process and accepting only digital payments eliminates these problems. AR automation grows along with your business and prevents you from putting undue stress on your team. Your customers’ information is saved on a single, secure cloud platform, so you won’t have to worry about cluttering your office with more filing cabinets or checks being lost or stuffed into the wrong customer’s file. 

Stave off check fraud with Bill360

Bill360 makes it easy to reduce or even eliminate check fraud because we make it simple for your customers to pay you digitally. You can also turn on AutoPay and embed "pay now" links in emails - payment methods that are far more secure than paying by check.

Read our eGuide to learn more about AR automation shields your B2B from fraud.

FAQ

Will my customers migrate away from checks?

Most B2B companies who pay with checks often don't have many other options. Enabling customers to use their own portal and wallet shows them there are far more secure payment methods than paper checks.

Why are digital payments safer?

Payments made with credit cards and ACH are traceable and have layers of security you don't get with a check. And these payments aren't physical and can't be stolen, altered, or lost.

Is it easy to transition from paper checks to automated AR?

It is with Bill360. Our platform requires less than an hour of training and syncs seamlessly with QuickBooks. And by ditching checks and going digital, you're saving your team up to 15 hours of manual work per week.