Industry News

6 Benefits of digitizing cheques and is it secure?

Miri Rader

Have you ever encountered those long frustrating queues at the bank while trying to cash your cheque? I bet you have probably thought of ways to avoid and overcome the tasks of printing, signing, and mailing cheques? How about the anger and waste of time that goes with having to deal with a bounced cheque?

Yeah, we know how annoying carrying out certain administrative duties and business transactions can be particularly when paper cheques and banks are involved. Yet, you have to get paid right? You need the cash flow for business to run smoothly and expand. Financial transactions and efficient internal processes are literally the heart and soul of any business. 

So, what if there was a better, faster and more secure way to send and receive payments? Imagine having convenience, ease of payments and security of your funds at your fingertips. That would be awesome right? This is where the digital cheque comes in, as an attempt to solve the problems that businesses encounter in their day-to-day activities. 

Do digital cheques actually solve the problem? Let's find out. 

So, what is a digital cheque?

A digital cheque, also known as an eCheque or electronic cheque, is a digital counterpart of the classic paper cheque that we are all familiar with. A digital cheque is submitted and communicated using an electronic device, such as your computer or phone, rather than going to the bank. The payee receives credit after depositing the e-cheque, and the payee's bank clears the cheque to the payee.

Digital cheques … or digitizing cheques?

Many banks nowadays offer digital cheque processing services that let you deposit funds by taking a picture of the paper cheque and uploading it to your online banking. At least this saves you one trip to the bank. But it still leaves you with the hassle of having to pick up the cheque in the first place, or the uncertainty of when and if it will arrive in the mail.

There is a difference between taking a picture of a cheque and uploading it digitally, and fully digitizing payment processes by eliminating cheques from your business processes completely.

Especially for businesses, dealing with cheques can lead to significant cash flow issues and hours of valuable time wasted on unnecessary admin time, even if they are digital. There are better solutions out there that enable your business to fully digitize payment processing and ditch the paper cheque for good. 

MazumaGo is not a digital cheque solution. It gives you the opportunity to fully eliminate cheques from your business. With MazumaGo, payments are securely processed via Canadian bank transfers, without transfer limits and for a flat fee per transaction. It has enabled hundreds of Canadian small businesses to digitize AR and AP processes with its simple and secure online payment solution. 

Now, we know that moving away from cheques and digitizing payments might sound like a big shift to take on and you may feel skeptical about the security of going full-scale digital. 

Well, here are six advantages of digitizing cheques and how your business will benefit from it. In this article, we also address your concern regarding the security of digital cheque alternatives. 

Let's get started, shall we?

1. Improved cash flow

Traditional paper cheques take time to go through the bank, and require time and effort to track. Whether it's making sure that a client’s cheque clears or its keeping up with cheques that are yet to be processed; paper cheques are time-consuming. It takes approximately 4 to 5 days for your paper cheque to be mailed. Not to mention clearing and processing times or even cheque holds. 

Now, consider the time it takes to prepare a paper cheque and the process involved. You have to print the cheque, you have to sign it, you have to put it in an envelope, you have to mail it, you have paperwork to fill… and the list goes on and on.

By digitizing cheques, you can reduce the time it takes to send your payment on its way down to 5 minutes. With MazumaGo, your payment will automatically be deposited within 2-3 business days. Our customers have been able to increase the time it takes to get paid by up to 7 days, compared to paper cheques.

2. Easier tracking

Waiting for your paper cheque to arrive in the mail can be frustrating. How many times have you heard your customer say “The cheque’s in the mail!”, only to find out a few days later that the payment has not even been sent out. There is also the possibility that your cheque could get lost in the mail.

Digital cheques enable you to see online once your payment has been deposited. With MazumaGo it gets better: Both you and your customer or supplier receive a tracking link that lets you track every step of your payment in real-time. You’ll know the minute your customer pays or funds arrive in your supplier’s account.

3. Save resources

Paper cheques are more costly to your business than you might expect. You pay money to print the paper, you pay for the stamp, you buy the envelope and a host of other expenses. How about the time wasted processing cheques? Remember the saying, time is money? Yeah, it applies to your business also.

After adding up all the hidden costs, a single cheque can cost your business anywhere from $25-$50.

Electronic payments are not only better for business, they are also better for the environment. There is no need to print paper thereby conserving natural resources and reducing the carbon footprint associated with paper cheques. By digitizing cheques, your business is contributing to a safer environment for all.

4. Better cash flow monitoring

Paper cheques are tedious to reconcile and make it hard to stay on top of all your incoming and outgoing transactions.

With digital cheques, it is easier to monitor your cash flow and handle accounts receivable and payable online. Having a digital statement also simplifies reconciliation in your accounting software.

Using MazumaGo, you have a digital dashboard that shows your transaction history, as well as payments that are currently processing. This makes it easier for you to access and understand your monthly balance at a glance and gives you a better image of your real-time cash flow. 

5. Make and accept payments anywhere

Do you remember how much time you wasted driving to the bank and waiting in line the last time you went to process your cheque? 

Digital cheques give you the flexibility to transact anytime and anywhere. Your suppliers will love you for paying on time, every time. Your customers will appreciate the convenience of paying invoices without having to leave their house. 

With MazumaGo’s fully mobile-friendly payment dashboard, you can manage all your business transactions from the comfort of your home, your office, or even on the go. You can easily initiate a payment with just a few clicks or keystrokes from any device. Yeah, it is as simple as that.

6. Improved security

Generally, digital cheques rely on the same security systems that make direct bank deposits possible, thereby ensuring that the best digital eyes are trained on your money. However, you should always do your research and make sure you are using a trusted, regulated provider.

With MazumaGo business payments, your transactions are processed at bank-grade security. We partner with BMO to process payments via ACH bank transfers between any Canadian bank. 

Ready to get started on digitizing cheques?

Long story short: Digitizing cheques will only bring benefits for your business. In our digital world, it is only a matter of time until the paper cheque will be eliminated, and it is better to get on board sooner rather than later. The shift from paper to digital payments seems more daunting than it is. After all, the time spent making the switch will be a tiny investment compared to the time you will save in the long run.

To get started, sign up for a free demo to see the suitability of our MazumaGo for your business OR sign up for a free MazumaGo account and you are well on your way to enjoying secure and convenient transactions.

Make business payments move.