Does this sound familiar…?

You’ve experienced this before, haven’t you?

A customer calls, frustrated and angry, because they “paid online” and still were charged a late fee or, worse yet, disconnected for non-payment.

Of course, by “paid online”, they don’t mean they paid using online bill pay on your website. Rather, they used their bank’s online banking to pay their bill. They either didn’t pay attention to or, worse yet, their bank didn’t inform them how long it would take for their “online” payment to make its way to your office.

Online banking checks

You know the checks I’m talking about, don’t you? They arrive like college grade reports – in a self-sealer envelope where you have to tear the sides and top off to get to the check. Or, if you receive several, even if they aren’t all for the same day, they may arrive in a large manila envelope.

As you’re probably well aware, these checks can take as long as a week, or more, from the time your customer initiates payment at their bank’s website until the check finally reaches your office. I’m hearing this has gotten worse recently as the USPS slows deliveries.

What’s the problem?

Well, there’s not just one problem. There’s the obvious problem, as described above, of well-intentioned, albeit misinformed, customers who think they paid on time and are now upset, creating a customer service headache for your office.

Even if your customer does initiate payment far enough in advance for the payment to reach your office on time, you still have to open and enter the check. Because they arrive in self-sealer envelopes, it’s not as easy as slicing open the top of the envelope – which can be done mechanically if you process a lot of checks. Each online banking check has to be opened by hand, methodically tearing off both sides, then the top to finally get to the check.

Then there’s the issue of the customer’s account number. Because of how these checks are processed, no bill stub accompanies the check. This means if you scan a barcode on the bill stub or use a remittance processing system, you have to process these checks separately. That’s not a big deal if the customer has entered the correct account number in their bank’s bill pay software. But what if they have the wrong account number – due to simply entering it wrong or some other reason? Maybe they’ve moved and haven’t updated their account number, or if you’ve recently changed software resulting in a change in account numbers that your customer hasn’t kept up with. In each of these cases, you have to look up their account number before you can enter the payment.

All this takes time, which reduces the efficiency of your mail payment process. Speaking of efficiency, if you haven’t already completed the 2024 Utility Staffing Survey, now would be a great time to do so!

What’s the solution?

If you are a large enough utility, the third-party check processors who print the vast majority of online banking checks have probably already reached out about sending you an electronic file. On the other hand, if you are a smaller utility with fewer online banking checks, you won’t be afforded the same opportunity.

So, what’s a smaller utility to do? Fortunately, there’s a solution! There are vendors who simplify this process by consolidating payments from the check processors. They deposit the funds into your bank account and provide an electronic file, which can be imported into your billing software. Even if your billing software is unable to import a payment file, it’s still much easier to enter payments from a list rather than opening each check before entering the payment.

What about the incorrect account numbers, you’re probably asking? Fortunately, these payment consolidators are also able to automatically correct erroneous account numbers. The first time you encounter an invalid account number, you enter the correct account number on the vendor’s website and every payment after that arrives with the corrected account number.

Not to mention the decrease in processing time. You receive the customer’s payment two days after they initiate payment from their bank’s website, not a week or more later!

How do I take advantage of this amazing technology?

If you are interested in learning more about how you can implement this for your office, please give call me at 919-673-4050 or email me at

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© 2022 Gary Sanders


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