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Paper checks let you make purchases, pay bills or pay someone using money from your checking account. But in the age of Apple Pay, Venmo and online shopping, does anyone need paper checks anymore? You don't need paper checks to pay from your checking account, but they can make some transactions easier. Here's a closer look at the pros and cons of paper checks and when you may want to use them.
What Are Paper Checks Used For?
Paper checks accounted for just 3.8% of consumer transactions in 2022, according to data from the Federal Reserve Bank of Atlanta. However, there are still some situations when you may want to use paper checks.
- Paying someone without using a payment app: When you owe money to a friend who doesn't use apps like PayPal or Venmo, a paper check is more secure than handing over cash.
- Paying certain businesses or organizations: A small business or charitable organization's website may not accept debit or credit card payments, or you may have concerns about the site's security. Some small businesses prefer receiving checks because credit card companies charge them fees.
- Gifting money: Mailing or giving someone a card with cash or a gift card inside is risky. If the card is lost or stolen, your gift is gone too. If a check goes missing, you can simply stop payment on it and write a new one.
- Paying school or extracurricular fees: Your local parent-teacher association, school fundraising organization or Little League team may not be set up to accept credit or debit card payments.
- Setting up direct deposit: When initiating direct deposit of your paycheck or government-issued benefits, you may be asked for a blank, voided check. Although there are other ways to set up direct deposit, a paper check provides all the information necessary in one place.
- Setting up automatic payments or other transactions: A blank, voided check can be used to set up automatic bill payments or authorize automated transfers from your checking account into an investment account.
- Making a purchase without a debit or credit card: You rarely see people writing checks at retailers or supermarkets anymore, but some business owners still accept checks. If your debit card is lost or stolen, paper checks may let you make purchases from your checking account without carrying cash.
- Getting a written record of your payment: A copy of your canceled check proves the recipient received and cashed the check. Of course, you can get proof of debit card, credit card, electronic or cash transactions by saving records or confirmation numbers or asking for receipts. But these might get lost, while a canceled check can typically be accessed any time via your banking website or app.
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Pros and Cons of Using Paper Checks
When deciding whether you need paper checks, consider the pros and cons.
Pros of Using Paper Checks
Paper checks have several benefits.
- Gift money to friends and family without a peer-to-peer payment app
- Pay for goods and services when other payment methods aren't accepted
- Obtain easily accessible proof of payment
- Unlike cash, can be deposited via mobile app without visiting a bank or ATM
- Safer than carrying cash or gift cards, especially if filled out correctly using black pen
- No computer or smartphone required to write or cash a check
Cons of Using Paper Checks
There are also some downsides to paper checks.
- Banks typically charge extra for paper checks
- Writing and recording checks can be time-consuming compared to debit card or online payment transactions
- Mailing checks requires paying for postage
- Paper checks may take two days or more to clear
- Check amounts won't be deducted from your account balance until the recipient deposits the check, potentially making it harder to track your account balance
- Lost or stolen paper checks can be used to steal money from your checking account
- Recipients without bank accounts may have to pay fees to cash a check
Alternatives to Paper Checks
Using paper checks sometimes makes sense, but there are plenty of alternatives that offer faster, more secure ways to pay with your checking account.
- Debit cards let you access funds from your linked checking account. You can pay with a debit card at most businesses, use your debit card for online purchases or payments, or link the card to a peer-to-peer payment account. You can also use your debit card to get cash for a purchase at your bank or an ATM. When you use a debit card, funds come out of your checking account immediately.
- Peer-to-peer payment (P2P) apps such as PayPal, Venmo and Zelle allow you to pay businesses and individuals from a linked bank account or credit card. Payments can be sent and received instantly using the P2P app. However, transferring funds from the app to your linked account may take a few days unless you pay a fee.
- Automated clearing house (ACH) transfers are used to send money to individuals or schedule online payments from your bank's website or mobile app. Making an ACH transfer is typically free and usually takes one to three days.
- Wire transfers electronically move money between banks. They are typically faster than ACH transfers—sometimes as fast as the same day—and involve a fee. You might use a wire transfer to send money to people overseas or cover a large transaction, such as a real estate purchase.
- Money orders can be cashed just like checks and used to send money overseas or when you don't have a checking account but need to pay with a check. You can purchase a money order from your bank or credit union, the post office, some retailers and supermarkets, and services like Western Union or MoneyGram. There is typically a small fee and a $1,000 limit.
- Certified checks are available from your bank or credit union, typically for a fee. A certified check is safer than a personal check because the issuer verifies your signature and sets aside funds in your account to cover the payment.
- Cashier's checks are used for major transactions such as a down payment on a home or buying a car from a private party. The bank or credit union issuing the cashier's check guarantees payment using their own funds. A cashier's check typically clears by the following business day and may involve a small fee.
Check It Out
Depending on your spending habits and tech savvy, you may not need paper checks. Considering going all-digital? If you're thinking about opening a new checking account, the Experian Smart Money™ Digital Checking Account & Debit Card can help you build credit without debt by automatically linking to Experian Boost®ø, which gives you credit for eligible bill payments after three months of payments. You'll also pay no monthly fees¶ for Experian Smart Money, have access to more than 55,000 fee-free ATMs worldwide** and could receive your paychecks up to two days early when you enroll in direct deposit†. You can get an Experian Smart Money Account through a free or paid Experian membership, which also gives you access to your FICO® Score☉ , Experian credit report and more. See terms at experian.com/legal.