If you consider yourself Gen Z or Millennial, then you should be familiar with mobile wallets and payment solutions such as Cash App and Venmo. But not long ago, checks were used on a day-to-day basis and provided a convenient cash-free solution that was trusted and traceable. Chances are, you’ve probably never used one, but they are still relevant in many countries, including the US.
Though the use of checks is becoming obsolete especially in urban settings, it is still handy to know how and when they are used. In this article, we’ll take a look at five reasons that make their existence still relevant in 2021!
You will need to verify your bank account for a lot of scheduled transactions. This is usually in the form of a voided check. From authorizing the government to deposit benefits into your account to have your employer(s) set a direct deposit for you, a voided check will provide the other party all the information they need to deposit funds into your account. You will need to know how to void a check, which is as simple as writing a large “VOID” across the front without blocking any of the important details at the bottom.
A lot of businesses charge a “convenience” fee for debit/credit card payments, especially for low-value transactions. This is normally in the range of 2-3%. Checks on the other hand are very cheap, and some banks offer them for free. For your average Joe, writing up a check for $100 is a much better choice than forking up another $2-3 worth of fees on top of that.
The reality of today is that not every region in the US has a stable internet connection, which is obviously a prerequisite of online payments. While rural areas are slowly catching up and closing the digital divide, an early 2019 study found that only 63% of rural America has a broadband Internet connection.
It’s often easier to write a check for all your bills and hit the bank once a month. Checks are still the trusted cashless payment method especially when you consider an older demographic that isn’t too friendly with credit and debit cards (forget Venmo altogether!). Most businesses don’t want to alienate this demographic and lose customers.
This might sound like an exaggeration, but in an event where there is a power outage, you won’t be able to use your cards because the terminals require electricity. Heck, some shops may not even be able to accept cash in larger denominations if they can’t access the cash register unless they are Mom and Pop stores that still have manual registers. Your only options in this scenario is small change and/or checks since there is no minimum to how much you can write up. The recent snowstorm in Texas has opened the eyes of Americans to the faults that lie in digital payment solutions!
In situations where card payments aren’t used, checks leave behind a paper trail in a way cash or money orders can’t. This is why many tenants still prefer paying their landlords by check! It is handy to keep a copy or scan of it (in case the payee raises any disputes). Keep in mind to write “copy” anywhere on the check so that you or anyone that gets their hands on it don’t try to pass it off as the original. This will get you in trouble with the law!
