Don’t start eulogizing the paper check just yet. Our “Check in the Mail” keeps gaining popularity. This release allows for scalability, security, and a better user experience for our partners.
At the end of 2020 we launched our Check in the mail rail. MPLs use checks to give their customers the option of receiving funds or paying off their existing loans via a paper check. Very old school, yes, but our MPL customers jumped at the option.
Our vendor, Checkbook, did a great job of printing and sending out the checks. Because of our architecture, they also managed the check clearing. As the volume increased though, relaying details of cashing, revoking, and expiring checks became a non-scalable procedure.
To address that issue, we needed to automate the clearing of the checks in-house. COS, our banking core, added a Positive Pay feature, and once Arix integrated that feature, check events could be automatically handled by Arix.
When a check is created, Arix adds it to Positive Pay in COS and it has an expiration date. The check is then printed and mailed out by Checkbook. When a customer tries to cash the check, the fed notifies CRB, and COS reviews the check. The check only gets cashed if all 3 conditions are met:
- The check is on the Positive Pay list and matches the account information.
- The check hasn’t expired.
- The check hasn’t been revoked.
Arix can revoke a check if MPL Operations or the MPL wants to stop a check from being cashed. And, if any of the 3 conditions are not met, COS will bounce the check when someone tries to cash it.
Any event that stops a check from being able to be cashed, such as an expired event or a revoke, will create a return event in Arix (for that check). After a return, you'll be able to request the funds again by check, or by another payment method.
Should I state the obvious? OK, I will.
Since the fed will now send the cash request to CRB, cashed events will now be in real time. No tech changes required by our MPL customers. Relax and enjoy the improved experience.
You may notice these features that we added:
- Check number is now printed in the message field for easier tracking
- Check image is now available to our MPL Ops once it is presented to be cashed
Any failure to create a check will result in a return. This will allow the rest of the loan amount to be disbursed using a different rail.
We are working with Checkbook on other possible mailing options (at present, only USPS).
If you are an MPL that’s keen on disbursing via digital rails, of course we support those as well as payment rails. If a business opportunity arises that requires more traditional payment methods, we’ve got you covered. We’re not burying the paper check just yet.
Updated 8 months ago