New Service Lets Members Use E-Mail for Payments
You can already pay bills online. Now you can exchange payments with your vendors and customers by e-mail.
Online bill-paying services such as Paytrust (https://www.paytrust.com) and those offered through banks let you send money to others but not receive it yourself. Achex (https://www.achex.com) and Paypal (https://www.paypal.com) are online payment and billing services that are used as settlement services by people who buy and sell via online auctions.
None of them do what Bellevue, Wash., start-up CheckSpace (https://www.checkspace.com) does: Enable you to send invoices and receive payments electronically.
CheckSpace, which has received $11 million in funding led by Seattle-based Voyager Capital, is aimed primarily at small businesses. The service facilitates electronic business-to-business payments between any parties with e-mail addresses and bank accounts. It’s especially useful for businesses that deal frequently with the same suppliers and customers.
Here’s how it works: You sign up for an account at the CheckSpace Web site by providing the name, address and phone number of your business, your e-mail address, a password of your choice and your bank account’s routing number and account number, which you can get from any check or deposit slip. You can use any type of bank account, including an investment account, as long as it issues standard checks. You do not have to send a voided check.
It’s all done via the Web. If you want to start using the service right away, you must enter a credit card number, which is used only to verify your identity and address.
If you wish to send money to someone, you click on the “send a payment” icon on the CheckSpace Web site and enter the e-mail address of the person or business that will get the money. If the recipients are already CheckSpace members, they will receive an e-mail saying that the payment has been deposited into their company’s bank account. If they’re not members, they’ll get an e-mail saying the money is available to them as soon as they sign up.
Although you could use CheckSpace to send money to someone who’s not yet a member, it’s not really a good idea, at least for now. It’s better to get your vendors and customers to sign up before you send money or a bill. In a few weeks though, the service will allow you to pay anyone. If the recipient isn’t or doesn’t become a CheckSpace member, he or she will get a regular check. If someone sends you money, and you’re already registered for CheckSpace, there’s nothing you need to do. It’s automatically deposited into your bank account.
CheckSpace charges the recipient 95 cents for each transaction, but the first five transactions each month are free. There is no monthly fee, and there is no cost to the person who is sending money.
CheckSpace provides rudimentary online accounting with a listing of payables and receivables as well as a “check register” for the payments you’ve made online. It can also export its data to a variety of standard formats, including Excel, Quicken and Microsoft Money.
The only problem with a service like this is that most of your vendors and customers probably won’t become CheckSpace users in the near future. But if there is a small business that you work with on a regular basis, it could help both of you streamline your payments, receipts and accounting for your mutual transactions.
Technology reports by Lawrence J. Magid can be heard at 2:10 p.m. weekdays on the KNX (1070) Technology Hour. He can be reached at larry.magid@latimes.com. His Web site is at https://www.larrysworld.com.
