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March 2026 • Issue 26:03:01

Long live checks – minus the paper

The report also discussed what consultants and researchers
Insider’sreport were predicting: checks (consumer and business) which at
the time totaled an estimated 40 billion, according to the
on payments Federal Reserve, would continue to grow at a rate of 2 to 3
percent per year for the ensuing five years.

"All available research reflects that checks continue to be a
significant part of the overall payment system, representing
23 percent to 24 percent of retail sales," the report stated.
Research commissioned by the National Retail Federation,
and referenced in The Green Sheet's 1997 report, revealed that
better than half (53 percent) of retailers had experienced no
decline in check payments in 1997 compared to 1996.

A trip down memory lane
I met Paul H. Green, founder of The Green Sheet Inc., in
the late 1990s. I was putting on conferences on what had
been dubbed the electronification of checks. Paul made a
presentation at one of those conferences detailing check
By Patti Murphy usage data from the 1997 report.
or anyone under the age of 40 it may seem hard Like Paul, I was convinced that checks weren't going away
to believe, but checks were once the most popular anytime soon. Where our visions diverged was in how the
non-cash method of payment. In 1997 just under check payment system would evolve. I saw paper giving
F 57 percent of consumer payments were made way to electronic origination. (Think in terms of filling out
by check, according to research at the time. Credit cards an online form, only one that resembles a paper check.)
accounted for 16.4 percent; debit cards represented 5.3
percent. I saw electronic check presentment (ECP) as a precursor.
ECP was popular with large banks at the time. It involved
"For more than two decades the banking industry has electronically capturing the MICR line information from
been attempting to eliminate the paper check in favor of checks and sending that information to paying banks in
a 'paperless' electronic payment system," The Green Sheet advance of the actual paper checks.
noted in a report published that year. "As we approach
the end of the century, banks are clearly improving the
speed and security of check handling through electronic Contributed articles inside by:
presentment strategies and bank automation, while
hundreds of paperless pilot programs continue to explore
new technology, strengthening the banking system's ability Allen Kopelman .....................................................................................16
to achieve electronic settlement."
Chad Otar ................................................................................................24
However, the report went on to state: "Overall, the paper Adam Atlas ..............................................................................................26
check payment system continues to function very well and
there is no basis for anticipating a check-less society, as Scott Dawson .........................................................................................28
predicted by bankers in the early 1970s, even by the year Leo Arzumanyan ...................................................................................30
2050."
Continued on page 22