Electronic Check Recovery

Benefits to Using Electronic Check Recovery

Electronic check recovery (RCK) converts non-sufficient funds and uncollected checks into electronic items and sends them through the Automatic Clearing House (ACH) Network for collection.  The National Automated Clearing House Association (NACHA) approved the rule that allowed returned checks to be collected through the ACH Network in 1998.  By using this system, it becomes easier to electronically re-present the check directly into the check writer’s account. 

In the third quarter of 2010, the amount of RCK transactions on the ACH Network increased 2.46% from the previous quarter, according to NACHA.  It is easy to see why this increase took place because there are many benefits to using an electronic check recovery system. 

Costs Are Reduced
Costs associated with representing an NSF check are drastically reduced when done electronically.  These lower costs also help make the collection of checks for smaller amounts more economical. 

Check Recovery Process is Faster
The whole check recovery process is expedited when it is done electronically.  Rather than having to send returned checks that are to be “re-presented” through the check clearing system physically, when the re-presentment takes place over the ACH Network, the funds can be collected sooner.  In addition, electronic items are typically given priority over paper checks in the re-presentment process. 

Consumers Benefit
The consumer benefits from electronic check recovery as well.  Many merchants use check verification databases to screen out bad check writers.  By using electronic check re-presentment, the removal of negative information from check verification databases occurs more quickly and consumers who have been labeled as “bad check writers” are able to have their check-writing privileges restored sooner.

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