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What Is ARC Check? Streamlining Paper Check Payments

What Is ARC Check? Streamlining Paper Check Payments

What Is ARC Check? Streamlining Paper Check Payments

Michael Fennell

Michael Fennell

Michael Fennell

Sep 20, 2024

Sep 20, 2024

Sep 20, 2024

5 min read

5 min read

5 min read

While electronic payments dominate today’s financial landscape, paper checks remain a common payment method for many businesses and individuals. ARC check processing bridges the gap by converting paper checks into electronic transactions, offering efficiency and speed.


In this article, we’ll explore what ARC checks are, how they work, their benefits, and how Profituity’s PlatformNext optimizes ARC check processing for modern businesses.

What Is an ARC Check?

What Is an ARC Check?

ARC stands for Accounts Receivable Conversion, a process that converts paper checks into electronic payments through the Automated Clearing House (ACH) network. Businesses use ARC to speed up check processing, reduce manual labor, and enhance cash flow.


How It Works:

  • A paper check is received (typically through the mail or a drop box).

  • The check’s details (routing number, account number, and amount) are captured electronically.

  • The transaction is processed as an ACH payment, depositing funds into the recipient’s account.

Benefits of ARC Check Processing

Benefits of ARC Check Processing

  1. Faster Deposits: Electronic processing reduces the time it takes for funds to clear.

  2. Cost Savings: ACH transactions are cheaper than manually depositing paper checks.

  3. Reduced Manual Effort: Automating check processing eliminates the need for frequent trips to the bank.

  4. Improved Cash Flow: Faster fund availability supports better financial planning.

  5. Enhanced Security: Electronic processing reduces the risk of lost or stolen checks.

Faster Deposits

Faster Deposits

Faster Deposits

Cost Savings

Cost Savings

Cost Savings

Reduced Manual Effort

Reduced Manual Effort

Reduced Manual Effort

Improved Cash Flow

Improved Cash Flow

Improved Cash Flow

Enhanced Security

Enhanced Security

Enhanced Security

How Does ARC Check Processing Work?

How Does ARC Check Processing Work?

  1. Check Receipt: A business receives a paper check from a customer.

  2. Electronic Conversion: The check’s data is scanned and converted into an ACH file.

  3. Authorization: The customer’s payment is authorized as per the notice provided during the transaction.

  4. Processing: The ACH file is submitted to the network for settlement.

  5. Settlement: Funds are electronically transferred to the business’s bank account.

Check Receipt

Check Receipt

Check Receipt

Electronic Conversion

Electronic Conversion

Electronic Conversion

Authorization

Authorization

Authorization

Processing

Processing

Processing

Settlement

Settlement

Settlement

ARC Check vs. Traditional Check Processing

ARC Check vs. Traditional Check Processing

Feature

Feature

ARC Check Processing

ARC Check Processing

Traditional Check Processing

Traditional Check Processing

Speed

Deposits typically clear within 1–2 business days.

Deposits typically clear within 1–2 business days.

May take 3–5 business days.

May take 3–5 business days.

Cost

Cost

Lower transaction fees.

Lower transaction fees.

Higher costs for manual processing.

Higher costs for manual processing.

Manual Effort

Manual Effort

Minimal due to automation.

Minimal due to automation.

Requires manual handling and trips to the bank.

Requires manual handling and trips to the bank.

Security

Security

Reduced risk of theft or loss.

Reduced risk of theft or loss.

Physical checks are more vulnerable.

Physical checks are more vulnerable.

Use Cases for ARC Check Processing

Use Cases for ARC Check Processing

  • Utility Payments: Converting mailed checks for faster bill payment processing.

  • Healthcare Providers: Streamlining patient payments received via check.

  • Nonprofits: Handling donations sent through paper checks.

  • Retailers: Managing mailed payments for purchases or invoices.

Utility Payments

Utility Payments

Utility Payments

Healthcare Providers

Healthcare Providers

Healthcare Providers

Nonprofits

Nonprofits

Nonprofits

Retailers

Retailers

Retailers

Challenges of ARC Check Processing

Challenges of ARC Check Processing

  1. Authorization Requirements: Businesses must clearly inform customers that their checks may be converted.

  2. Transaction Limitations: ARC is typically used for consumer payments, not business-to-business checks.

  3. Error Risk: Scanning errors can lead to delays or rejected transactions.

Authorization Requirements

Authorization Requirements

Authorization Requirements

Transaction Limitations

Transaction Limitations

Transaction Limitations

Error Risk

Error Risk

Error Risk

How Profituity’s PlatformNext Enhances ARC Check Processing

How Profituity’s PlatformNext Enhances ARC Check Processing

Profituity’s PlatformNext offers a comprehensive solution for businesses managing ARC check payments:

  • Automated Conversion: Converts paper checks into ACH files seamlessly.

  • Error Detection: Identifies and corrects data inconsistencies during conversion.

  • Compliance Assurance: Ensures compliance with NACHA rules and authorization requirements.

  • Batch Processing: Handles large volumes of checks efficiently.

  • Integration-Friendly: Connects with your existing accounting or ERP systems.

With PlatformNext, businesses can optimize their ARC check workflows and focus on growth.

Automated Conversion

Automated Conversion

Automated Conversion

Error Detection

Error Detection

Error Detection

Compliance Assurance

Compliance Assurance

Compliance Assurance

Batch Processing

Batch Processing

Batch Processing

Integration-Friendly

Integration-Friendly

Integration-Friendly

The Future of ARC Check Processing

The Future of ARC Check Processing

As payment technologies evolve, ARC check processing will continue to adapt. Key advancements include:

  • AI-Powered Scanning: Enhancing accuracy in capturing check data.

  • Blockchain Integration: Increasing transparency and security in transaction tracking.

  • Broader Adoption: Encouraging more businesses to transition from traditional checks to ARC processing.

AI-Powered Scanning

AI-Powered Scanning

AI-Powered Scanning

Blockchain Integration

Blockchain Integration

Blockchain Integration

Broader Adoption

Broader Adoption

Broader Adoption

Simplify your check processing with Profituity’s PlatformNext. Schedule your demo today to learn how we can optimize ARC check transactions for your business.

Conclusion

Conclusion

Conclusion

ARC check processing provides a vital bridge between traditional and electronic payment methods, offering businesses a faster, more cost-effective way to handle paper checks. By leveraging tools like Profituity’s PlatformNext, companies can streamline their payment workflows, reduce costs, and ensure compliance with ease.


Don’t let outdated processes slow you down—embrace the efficiency of ARC check processing today! Get started now!

FAQs

FAQs

FAQs

1. What is an ARC check?

2. What does ARC stand for?

3. What is ARC in banking terms?

4. How do you verify ARC?

1. What is an ARC check?

2. What does ARC stand for?

3. What is ARC in banking terms?

4. How do you verify ARC?

1. What is an ARC check?

2. What does ARC stand for?

3. What is ARC in banking terms?

4. How do you verify ARC?

What is an ARC check?

What is an ARC check?

What is an ARC check?

What does ARC stand for?

What does ARC stand for?

What does ARC stand for?

What is ARC in banking terms?

What is ARC in banking terms?

What is ARC in banking terms?

How do you verify ARC?

How do you verify ARC?

How do you verify ARC?

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Wexford, PA 15090

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© 2024 | Profituity, LLC. Profituity is a registered trademark. All rights reserved.

Contact Us

5500 Brooktree Road, Suite 104
Wexford, PA 15090

Stay Updated with Profituity

Get the latest insights straight to your inbox.


© 2024 | Profituity, LLC. Profituity is a registered trademark. All rights reserved.

Contact Us

5500 Brooktree Road, Suite 104
Wexford, PA 15090

Stay Updated with Profituity

Get the latest insights straight to your inbox.

© 2024 | Profituity, LLC. Profituity is a registered trademark. All rights reserved.