Electronic Payments Getting More Attention in May

This month, banks, credit unions, non-profit associations, businesses, and governments across the nation are asking consumers to increase their use of Direct Deposit and Direct payment in place of paper checks. An industry group led by NACHA – the Electronic Payments Association, Electronic Payments Network (EPN) and the Federal Reserve Banks, is sponsoring the month and encouraging financial institutions and businesses to actively promote these services to their customers and employees.


Advertisement


All Aboard the High-Velocity 2006 FRx Express! FRx Software has the engine fired up again to travel nationwide with timely training and expert guidance! Microsoft FRx and Microsoft Forecaster users, potential users and resellers don’t miss this FREE*, half-day event!

Once you’re on board, the FRx Software experts will help you gain tremendous insight into Microsoft FRx and Microsoft Forecaster. You’ll have the opportunity to hear customer perspectives and network with prospects plus pack in useful tips, and see the features and benefits of FRx Software’s financial analytic applications. Register now!


FRx Software Home Product Information
Training & Consulting Product Demo
Webcast Customer Testimonial Video



“During May, we encourage businesses and financial institutions to educate their employees and customers about the convenience, security and financial benefits of Direct Deposit and Direct Payment,” Elliott C. McEntee, president and CEO of NACHA, said in a prepared statement. “These services are no longer the wave of the future. They are widely used by millions of Americans who understand that they can save valuable time and money by getting paid and paying bills electronically.”

A recent study sponsored by NACHA (The Response Center 2005) shows that large companies are much more likely to use Direct Deposit than small (2-49 employees) and medium (50-499) size businesses. Although 75 percent of small companies surveyed were aware of Direct Deposit, only 26 percent used the service to pay their employees.

Of small business owners, 42 percent that don’t use Direct Deposit said they thought the service was designated for larger companies. However, a 2003 survey by Tinucci showed that even small businesses can save more than $5,000 per year by switching employees to Direct Deposit for paychecks.

“This survey points to a real opportunity for us in the electronic payments business to reach out and engage small and medium sized businesses to increase their understanding and use of Automated Clearing House (ACH) payments,” Mark Tizzard, Vice President of Strategic Migration for Wachovia Bank and 2006 Chairman of NACHA’s Marketing Management Group, said in a prepared statement. “As we continue our consumer advertising campaign, we also need to strengthen our industry messages that the ACH network is for all businesses, not just large corporations. The cost and time savings of Direct Deposit and Direct Payment could prove especially helpful to organizations looking to trim budgets and when time is at a premium.”

Another recent survey, the BAI Small Business Payment Strategies study, conducted in collaboration with Oracle and Unisys, found that among businesses having between $5 and $10 million in revenues:

  • 80 percent of business in this segment expressed a strong interest in a technology-based electronic platform

  • 82 percent of respondents in this group said they use or plan to use ACH direct deposit

  • 79 percent of those responding currently use or plan to use wire transfer.

The findings of this survey will be discussed at a BAI TransPay Conference & Expo on Wednesday, May 24th, 2006, in Las Vegas, Nevada.

At the same time Americans are pushing to increase use of electronic payment systems, a coalition of consumers’ groups in Canada is calling for legislation to protect consumers making or receiving electronic payments. The Globe and Mail reports that nearly 500 million preauthorized payments were processed in 2003, almost seven times as many payments as were made in 1990. The Canadian Payments Association says there are two million preauthorized transactions daily, according to the Globe and Mail.

In addition, the Globe and Mail cites an Environics survey from March which indicates that 12 percent of Canadian bank users have reported problems with preauthorized payments during the last two years, a rate of more than 1,000 debit problems a day or 900,000 in two years. The most common problems cited are:

  • Debits in the wrong amount (23 percent)
  • Debits on the wrong date (19 percent)
  • Double debits (17 percent)

You may like these other stories...

IRS must take oath on Lerner emails: judgeMackenzie Weinger of Politico reported on Thursday that a federal judge ordered the IRS to explain under oath how it lost emails connected to Lois Lerner, the ex-IRS official at the...
Credit Suisse says pension assets at risk unless court delays sentencingJohn Letzing of the Wall Street Journal reported on Wednesday that Credit Suisse Group AG says its management of billions of dollars in assets for...
The prospect of International Financial Reporting Standards (IFRS) being fully adopted in the United States in the near future are growing less likely, as the Financial Accounting Standards Board (FASB) and the International...

Upcoming CPE Webinars

Jul 16
Hand off work to others with finesse and success. Kristen Rampe, CPA will share how to ensure delegated work is properly handled from start to finish in this content-rich one hour webinar.
Jul 17
This webcast will cover the preparation of the statement of cash flows and focus on accounting and disclosure policies for other important issues described below.
Jul 23
We can’t deny a great divide exists between the expectations and workplace needs of Baby Boomers and Millennials. To create thriving organizational performance, we need to shift the way in which we groom future leaders.
Jul 24
In this presentation Excel expert David Ringstrom, CPA revisits the Excel feature you should be using, but probably aren't. The Table feature offers the ability to both boost the integrity of your spreadsheets, but reduce maintenance as well.