Cheaper Checks

You can save with paper checks too.

Even if you plunge headlong into electronic banking, not everyone will follow. The Girl Scout selling cookies at the door and the church usher taking a collection can't take online transactions. You're probably going to need at least a few paper checks.

But a box of 200 paper checks costs up to $20 through your bank. That price sends many consumers to mail-order checks, at $5 or $6 a box.

"It's the same paper, same inks," says Steve Jensen, president of Designer Checks in Anniston, Ala. (800-239-4087). Most check printers use security features, such as micro print, to combat check fraud. (Look for a tiny "padlock" on your check.)

In fact, the same companies that print checks for banks also print for companies such as Designer Checks. But the banks add their own handling fee.

Current Inc. (800-204-2244) of Colorado Springs, Colo., pioneered mail-order checks a decade ago. Now about 15 percent of checks are sold through mailorder, and Designer posts double-digit growth.

You can usually find mail-order checks advertised in Sunday newspapers.

Why don't more customers make the switch? "It's a little risky in most people's minds," Mr. Jensen says.

And the most popular design: still safety blue. "They think: 'It's a check. You write on it. You pay bills. It doesn't reflect my personality,' " Jensen says.

Watch the Check Bounce: Paper vs. Electronic payments

Electronic transaction

Pre-authorization

A Boston insurance company offers customers the chance to pay electronically. Bob in Atlanta mails in the form, and the insurance company sets up the transaction with its bank.

Bill notification

July 10: Insurance company mails Bob a bill.

July 15: Bob receives the bill and notification that his account will be debited $279 on Aug. 1.

Payment

Aug. 1: Insurance company's bank sends a $279 debit request electronically to Bob's bank, which sends the money electronically from Bob's account through a bank clearing house.

Aug. 2: Insurance company's bank gets payment.

Transaction time: one to two days.

Transaction cost: $1.18-1.50

Paper check

July 10: Boston-based insurance company sends Sue in Atlanta a $279 bill, due Aug. 2.

July 15: Sue receives bill and files it for payment.

July 27: Sue mails check.

Aug. 1: Insurer receives the check and deposits it into its local bank in Boston.

Aug. 1: Bank encodes the check with magnetic ink for $279, credits the company's account, and forwards it, plus other non-local checks to the Federal Reserve Bank of Boston via courier.

Aug. 2: Fed credits the insurance company's bank for all its checks, then sorts them with special machines that read the magnetic ink.

Aug. 3: Sue's check is bundled with others drawn on Atlanta banks and flown to the Fed bank in Atlanta, which credits the total to the Boston Fed.

Aug. 4: Atlanta Fed charges Sue's bank for $279 and sends the check via courier to her bank. Her bank debits Sue's account, stores the check, and later mails it to her with a monthly statement.

Transaction time: 1 to 10 days.

Transaction cost: $2.81-3.12