Archive for Thursday, September 24, 2009

Check evolution

September 24, 2009

Recently, I read that a huge U.S. retailer was going to stop issuing paychecks to its employees. The amount of salary due would either be electronically deposited in a bank account or the employee would be issued a company debit card. This is another step toward sending paper bank checks to join buggy whips and phonograph needles in the growing heap of obsolescence.

Let me start by saying that I do not use electronic deposit for checks. I am so old fashioned that I enjoy having the check in my hand, and it doesn’t bother me to take a few minutes and amble by the bank to make a deposit. I enjoy visiting with people I meet in banks and some financial institutions are even reaching out to me by serving cookies. It seems extremely cold to have your money deposited without it ever touching your hands.

I recently read an article by a man who was talking about the thrill of receiving his first pay check and that brought back memories. Going to the bank to cash my first check was a big event. It meant that I had moved into the real world of employment. A pay check meant that you had a real job and that was an important part of growing up.

I didn’t realize it, but a form of check goes back nearly 2,400 years. One book stated that the first, primitive checking dated about 350 B.C. The ancient Mesopotamians, Greeks and Romans all used a form of check to transact business. Of course the reason to develop a form of checking was very simple. Many times commercial transactions between civilizations required a lengthy and dangerous journey bringing the fear of theft. In fact, one of the reasons that Columbus was sent on his voyage in 1492 was to find a safer way to the orient. Far too many caravans were high jacked and fortunes lost.

Apparently the early check was merely a letter of credit allowing a traveler to charge goods and a financial institution guaranteed payment.

The idea of checks caught on in the ancient world and by the middle ages, commercial centers such as Venice and Genoa were flourishing centers of commerce, largely based on the forerunner of our modern banking system.

It is interesting to note that England got in the check business later. Checking wasn’t big in England until the 18th century. The Brits were afraid that the checks would encourage fraud.

Certainly, checking has changed over the years. Only a couple of decades ago there were counter checks at most stores. A customer could simply take a check from a pad provided by his bank and write a check. When I was in Missouri, the store owner even simplified the system by filling out the check and handing it to the customer to sign. I’m sure that system led to overdrafts and other problems. All of us who have been in business know the frustration of taking a bad check. The advent of the computer has changed the way business is transacted. Now the credit card and the debit card are widely used, and their rise has resulted in the check fading away.

I will admit that it is simple. You sit at your computer, check your banking balance, and then you pay your bills with the push of a few buttons.

We don’t do it that way. I take the checks we receive, deposit them, and Jean neatly pays the bills. One of my jobs on the first or second day of each month is to pay local business and to go to the post office and mail the others. Yes, I know that postage costs money, yet we are probably much too old to begin to change the way we do things. I am sorry to hear that the paper check will probably not exist in four or five years, and that I will be forced to join the modern world. In the meantime, I will fasten my button shoes, fire up the Stanley Steamer and cruise around town making my payments to business people who really don’t seem to mind taking checks.

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