FREE Electronic Check Recovery Program
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Frequently Asked Questions
Q: What is Electronic Check Representment (RCK)?
A: RCK refers to represented check entries or the process of resubmitting nonsufficient funds (NSF) checks electronically through the Automated Clearing House (ACH) Network.
Q: When was RCK Approved?
A: In 1998 National Automated Clearinghouse Association (NACHA) approved the new banking interim rules that allow a merchant or agent to represent NSF checks electronically. The permanent rule became effective on September 15, 1999.
Q: How can Merchant's Benefit from RCK?
A: Electronic Check Representment allows the merchant or agent to time the debit of the check writer's account. This alone can result in a substantial increase in recovery rates.
Q: Are There Cost Savings to the Merchant?
A: Yes, since everything is electronic, there are no redeposit fees charged to the merchant for resubmitting the checks electronically the second and third times. Additionally, there are no letters to write or phone calls to make to the check writer in attempts to collect the bad check.
Q: What can a Merchant Expect for Improvement of Recovery Rates with Electronic Representment?
A: Increases in collection rates from 50%-96% over traditional collection methods have been reported by merchants using RCK.
Q: What Legal Regulations and Guidelines Apply to RCK?
A: RCK entries are subject to the applicable NACHA Operating Rules, Uniform Commercial Codes (UCC) and Regulation CC. However, RCK transactions are originated by check and are therefore exempt from the provisions of the Electronic Funds Transfer Act and Regulation E.
Q: What Types of Checks can be Represented?
A: Checks that indicate on the face that the check was returned due to "Not Sufficient Funds", "NSF" or "Uncollected Funds" or comparable language.
Q: How Many Times can the Merchant Represent an Item?
A: A total of three (3) presentments are allowed. The RCK entry can be sent twice if there was only one previous physical presentment, but only one time if there were two physical presentments.
Q: Is There a Dollar Limit on Checks Submitted for Representment?
A: Yes, checks with a face value of $2500 or less may be processed.
Q: What Must the Merchant do to Inform the Customer?
A: The merchant must notify the customer that their return item may be collected electronically if the check is returned for insufficient or uncollected funds. Notice should be contained on a sign at the point-of-sale, a receipt or on monthly billing statements.
Q: Is There a Time Limit on Checks that can be Represented?
A: Yes, each RCK entry has a time limit of 180 days from the date of the check.
Q: What Items are not Eligible for Representment?
A: The following items are not eligible:
- Drafts drawn on the Treasury of the United States, a Federal Reserve Bank, a Federal Home Loan Bank, or state/local governments
- Postal Service Money Orders
- Items not payable in U.S. currency
- Items indicating on its face that it was returned for reasons other than "Non Sufficient Funds", "NSF" or "Uncollected Funds"
- Checks over $2500
- Unsigned demand drafts
Q: Is the Merchant
allowed to charge the check writer a fee for RCK processing?
A: Merchant must notify customer about
representment at point-of-sale. A collection fee may not be added to the
amount of the RCK entry, it should be submitted as a separate transaction.
Q: After a
Check is Determined to be NSF, who Retains the Paper Check when RCK is
Initiated?
A: The paper check is retained by the
merchant or his agent. Copies can be requested from the merchant or agent.
Q: How do I,
as a Merchant, sign up for RCK?
A: CHEXcollect
toll free at 1-866-691-0666 and tell them your ISO is Able Entrepreneur.
Q: Will I the
Customer, have to Pay a Fee to My Bank for the First and Second
Representment?
A: Normal NSF check fees are charged by
financial institutions. The merchant is also allowed to charge a service
fee for an NSF check.
Q: Will I
Receive my Paper Check in my Monthly Bank Statement?
A: No, the check is retained by the company
collecting the check electronically or returned to the merchant. Your
monthly bank statement will include the payee's name, "Redepcheck"
in the description and the check amount.
Q: What if I
was not Notified of the RCK Process?
A: You may sign an affidavit with your
financial institution that you did not receive notice. Your account will
be credited.
Q: Who can
Electronically Debit my Account for an NSF Check?
A: Merchants, billers and financial
institutions have the option of debiting your account electronically for
checks that have been returned. However, they must notify you prior about
this procedure.
Q: Can I
Decide how the NSF is Represented?
A: No, the merchant, biller or financial
institution can represent the paper check or represent it electronically.
Q: What if I have
electronic check conversion?
A: You can still use
CHEXcollect for the checks you do not convert
to electronic debits, it acts as a safety net for the checks that are not
converted
Q: How does CHEXcollect
get paid?
A: We get paid from the check writer. We
debit the maximum state allowable fee.
No Processing Fees - No Set Up Charges - No Surprises!
Please contact your Sales Representative to get started today or for more information.
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