It is Worth It To Accept Online Checks?
 

We have been getting alot of chargebacks on checks, anyone else have this problem? We have just a few chargebacks for credit card sales but the checks are out of control.

Mark

We dropped all checks except those through Paypal after an 80% NSF rate. Paypal is the only way to do checks almost no NSF's.

Yeah... we have problems with that also. $770.00 last month in bad check charge backs. However, check customers do rebill better then credit card guys. It about balances out in the end, but it is a huge pain in the ass. I tracked a guy done one time that had mutiple bad checks with us. He fially sent me a money order for $225.00 to over his bill. lol I still black listed him. lol

GOSH I was just looking and thinking the same thing, I just got a shitload of bad check notices, I dont want to remove checks but wondering how the fuck can i scare these bad check thives before they strike

Guys,

Ask yourself wh all the biggest sites out there accept checks??

If you have 80% check returns, you are with the wrong check processor.

The fact is that although many checks come back returned, you still make money accepting checks if you are with a processor that charges you only on what clears.

If you run an affiliate program, you need to pay out ONLY on cleared checks.

Don't confuse all returned checks with "charge-backs".

Because checks can be returned for invalid account, NSF, account closed, account frozen, non-ach account, etc. does not mean it is a charge-back. A check returned for revocation of authorization or customer advises not authorized is the equivelant of a charge-back.

Once you understand that surfers who use checks are doing so because they cannot pay any other way, you can see how the checks that are returned (for whatever reason) are simply a cost of doing business.

As long as you are not paying a return fee for these, you will make more money.

PerfectionGirls, you are on the right track. :thumbsup

no checks at all on our sites, we learned our lesson in 2001 when we were seeing between 60-80% of our checks come back as bad, many of them not just 'NSF' but 'unknown accounts', it seems it is too easy to fake out the check verification systems, we cut our losses and haven't taken one since april of '01..

like somebody else said, the MAJORITY of your checks will be bad but the ones that are legit will rebill nicely. I'd rather have access to someone's bank account than their credit card. With their bank account, their paycheck goes in there every week, making them more likely to let you keep taxing them...With the credit card, they gotta see that charge on their statement and they are getting charged that amount PLUS interest and fees.....

Here is reality as I see it

If you accept checks knowing 80% will not clear for what ever reason you can do one of two things

1. Not ship goods or provide access until they clear. We tried that people want instant gratification on subscriptions they are not going to wai. It will work for hard goods but some checks seemm to take forever to clear.

or

2. Provide the goods or access and then close the account. Lot's of work and perhaps lost real sales when people realize (which they do already) that they can use a valid ACH number and make up any other information and get access.

I think until there is instant verification that the account is valid and funds are in it checks are not for this business.

Online checks are a joke. It takes what a week for the shit to clear.....if it does, and by that time they cleared your entire members area lol.

Personally, I don't really look at the return rate, I look at the bottom line. Sure, there are alot of returns, but it still brings in postive cash flow . . .

No offense, but what does Cybererotica, Adult.com, Silvercash, Platinum Bucks, Python, etc know that you don't?

Again, if you were getting 60-80% returned your processor had ZERO idea what they were doing.

Probono, this is already a reality. We offer this if you want to use it.

Currently, it has coverage on more than 50% of the DDA accounts in the US.

The institutions that are not coded up to this are seeing all the check fraud (in the real world, not the miniscule Internet part) being diverted to them.

They have a serious incentive to code up to these systems. It will happen quickly.

Here are the facts...

the majority of check returns come back in 1-2 business days from presentment. The scragglers come in between 3-5 biz days.

We were the first check processor on the Adult Net. We process for most of the big sites and are the back-end for a few other billing companies.

Again, there is a REASON that the BIG BOYS accept checks. THEY MAKE MONEY!

In fact, if you look at what they are doing, you will see that most of them make checks the most prominent payment option to try and get as many check sign-ups as they can.

Now, if you are a small fry and are really concerned about your bandwidth or content being stolen, then maybe you should not take them. :Graucho

i know nothing, other than i don't like paying for bandwidth that doesn't have a return..

I really can't imagine a site NOT taking checks, unless they want to cut off 10% of their bottom line profit and try to make it up somewhere else.

Yes, there are lots of reasons that checks come back, and yes, a percentage of them are going to come back.

If you pay your affiliates on cleared checks only, all you stand to lose is some bandwidth on the bad ones, and unless you are paying 1997 prices for that, you aren't losing nearly what you are gaining...

Maybe you should try doing the math again. :)

KK, I concur.

I remember in 96' when many sites would not even accept checks. The ones that did got maybe 5% extra revenue. These days it's upwards of 20%.

Today, not taking checks is unheard of. Well, not totally unheard of. LOL

Probono,

Who is your check processor? Our merchant's see an average of less than 28% returns on checks. This has alot to do with the Starchek and Experian verifications systems that we use along with our negative databases. I know WTS does similar verification as us and also have great success. I will be happy to explain what Starcheck and Experian do if anyone os interested. Let me know.

Our check solution costs the merchant only 3.25% and 40¢ per transaction.

I will not name any names but with several of the well known processors you can simply have a valid routing # and make up an account # along with a fake name, address and phone #, to make a successful purchase. This is where Starchek and Experian really help. There is no setup fee to accpet checks with Netbilling and no merchant acohahahaha is required either. If you are not happy with your current return rate, give us a try. You will be pleased.

Toll Free within the US: (888)357-8166
Outside the US: (661)252-2456


Mitch

sorry, not me... after having 43 signup's during one month at $29.95 apiece that only 2 of turned out to be legit, and the bandwidth burned over the 1-3 week periods before they all came back as bad/returns, i could care less about taking checks again, no way. more for you, wig... your welcome to them.

We use CCBill and 2000Charge for checks, anyone else? What percent are bad?

Mark

Hey Mitch, I was always curious.... What do you charge for returned items? You never mention that and it is an important part of the equation.

did not read much of the post but wig's post.. i take checks from the 2 of the big ones. and the one i have a shit load of checks coming back. so keep a (EYE) out for them.. i also use (SEESEEBILL) in 3 years maybe 10 in the last 3 years...

Mitch I had you on my Internext list and missed you so I will call and discuss this with you tomorrow. The processor we used did only check for a valid ACH number and people did make up everything else. Hence the huge return rate.

wig,

Returns are $2 with us.

----------------------

Probono,

I will be happy to speak with you and will be in the office all day tomorrow. My direct line is: 661-252-2456 x1002

Thank you, Mitch Farber

Hey gypsi,

Did I read that right, 10 bad checks from CCBill in 3 years. We had 3 just today.

Mark

Well now if I say Mitch never misses an attempt to spam, he sure can't say it's because I'm a competitor.

Ok...I didn't read the bottom half of the posts so if someone mentioned this already overlook it.

We were looking in to ways to verify checks at a local business we had. We found a company offering a credit card merchant account with a check verification system. With that system if someone writes a check, instead of putting it in the bank to wait on funds, you could scan the check and give it back to the customer. If automatically debited their account instantly for the check amount.

There may be an online biller that uses a system like this and if so they should. Because your funds are debited instantly there is no risk of no funds. And with it they deposited the amount in your bank account just like credit cards, 2 or 3 days later.

Hope that helps.

Well Kim SPAM makes for great sushi!

So you made $60 you wouldn't have made otherwise from those two sales, and spent what, $20 on your bandwidth for those 43 members?

That's a $40 profit up-front, add recurring and upsells...

Egads, I had sushi for lunch today, but there was no spam in it ;)

And now you know why SPAM sells so well in Hawaii.

Stocktrader23, this is product that is offered for face-to-face transactions at the point of sale. There is not currently a product that does this for non face-to-face transactions, but they are talking about it.

You can bet that when it becomes available, ACH processors will be all over it.

Keep in mind that this does not remove the revocation rights of the consumer and, like StarCheck, will not have 100% coverage from the onset.

We haven't been using Epoch long enough to give a good idea of numbers there, but with Ibill we get about 40% of our checks reversed, but we retain the check customer an average of 6 months compared to a 2.4 average with credit card.

Money in the bank...

Dude, why did you email me using a template letter? Not cool.

Did it cross your mind that I don't even run Epic Cash? You tried to sell me something that I have absolutely no control over. What good does that do?

Online checks = Easy Backdoor into Your Members Area. There's a real reason some of you see 80% returns. The system...as it currently stands...is flawed.

I will say no more.

:1orglaugh :1orglaugh :1orglaugh :1orglaugh :1orglaugh

The checks are never bad from CCBILL, the porn surfer is the culprit just to clarify CCBILL is not your customer Mark!!!

www. adultbrowser.com

If one guy gets into your members area with a bad check, it won't kill you.

If you aren't protecting yourself from password issues then you have way more serious problems than taking online checks I would think.