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Check Writing for Every PC User

LAWRENCE J. MAGID <i> is a Silicon Valley-based computer analyst and writer. </i>

I hate to pay bills. It’s not just that I don’t like to part with my money; I also detest the process of writing checks, recording the transaction in my check register and making sure that the check gets into the mail.

Fortunately, that’s no longer necessary. For some time, several banks have offered home banking services that make it possible for PC users to sign on to the bank’s computer and pay bills, check on balances, transfer funds between accounts and, in some cases, review statements and transactions.

And now, even if your bank doesn’t offer such a service, it’s possible to enjoy the convenience of electronic bill paying. Checkfree Technologies of Westervile, Ohio, offers a service called CheckFree that lets you pay your bills from your PC without writing a check. You can draw funds from any financial institution that issues checks, including banks, savings and loans, credit unions and brokerage firms.

The service requires an IBM or compatible personal computer and a modem to connect your machine to a telephone line. It comes with its own software. A version that will work with the Apple Macintosh is scheduled to come out later this year.

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Before you can use the service, you must send the company a voided check. You also fill out a membership form and agree to allow CheckFree to debit your checking account for any transactions you order.

Using the software is easy. When you first use the program you fill out a form on the screen with your name, address, phone number, social security number, name of your bank and your four-digit CheckFree account number. Then you provide CheckFree with information about any individual or business--all referred to as “merchants"--that you wish to pay. Additional merchants can be added at any time.

This is a lot more convenient than some banks’ home banking services, which allow you to pay only vendors who are registered with the bank to accept such payments. Bank of America’s HomeBanking service, for example, issues a directory with the names of 15,000 payees, including many large and small businesses but not necessarily those that you want to pay.

I tested the CheckFree service by adding myself as a merchant and sending myself a check. I also used it to pay some bills. The service requires three business days from the time you order the check until it is guaranteed to arrive. My check arrived a day early, and all the other bills were paid on time.

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When you’re ready to pay a bill, you use the arrow key on the computer keyboard to highlight the name of a payee from the list of merchants that you have entered. The screen then displays the image of a check, made out to the payee and dated three business days from the current date. (You can enter a later date if you prefer.) You enter the amount and a one-line “memo” that will appear on a statement sent with the check. That’s it.

Once you’ve finished “writing” all your checks, you tell the software to send your transactions to CheckFree’s processing center. The software instructs the modem to dial the phone and send the information. A record of that payment is saved in a check register that can be printed or displayed. The software does not perform any home or business accounting tasks, but users of two of the leading home accounting programs, Quicken (reviewed in last week’s Computer File column) and Managing Your Money, can import data directly from CheckFree.

The company uses three methods to issue payments. Some payments are made by electronic funds transfer through the Federal Reserve System. That requires the payee to be registered to receive such funds. In the case of individuals or businesses that are not registered, CheckFree issues a paper check.

CheckFree debits your account on the day that the merchant is scheduled to receive your check, regardless of when you processed the payment. With some home banking services, including those from Bank of America and CitiBank, the bank debits your account up to five days before the payee actually receives your funds. Until then, the bank gets free use of your money.

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Subscribers to CheckFree generally don’t get back their canceled checks. They do, however, get a notation on their bank statement. Such notations, according to CheckFree literature, are all the legal evidence you need for tax or other purposes.

For me, CheckFree simplifies the entire bill-paying process. Not only do I avoid paper work, but I can pay my bills at my convenience, as long as I process the order three or more days before the payment is due.

The service can eliminate the game of Russian roulette that some people play with their bills. They want to pay their bills on time but don’t want to send their money too early. So they wait until a couple of days before the payment is due. If they slip up, however, they risk being late. That can result in extra charges and, if it happens too often, a bad credit rating. With CheckFree, you can pay your bills up to a year in advance but hold onto the money until the bill actually is due. You also can order the service to make recurring payments for such regular bills as mortgages, car loans or insurance premiums.

When you take into account the money you save on postage and check-printing costs, the price of CheckFree service is reasonable. There is a one-time $49 fee for a start-up kit that includes the software, a manual and the first month’s usage. The service costs $9 per month for up to 20 payments. Additional payments cost $3 for up to 10 transactions. There are additional charges for stop payment orders, returns for insufficient funds or printed statements. CheckFree is at 720 Greencrest Drive, Westervile, OH 43081. Phone: (614) 898-6011 or (800) 848-6070.

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Computer File welcomes readers’ comments but regrets that the authors cannot respond individually to letters. Write to Lawrence J. Magid, P.O. Box 620477, Woodside, Calif. 94062, or contact the L. Magid account on the MCI electronic mail system.


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