What is RCK?
A Re-presented Check (RCK) Entry is a re-presentation of a check payment that has been returned for non-sufficient funds (NSF). RCK is the conversion of a physical check to an Electronic Funds Transfer (EFT), which allows a merchant or business to re-present the check through a debit transaction via the Automated Clearing House (ACH) in order to collect owed funds.
Businesses can spend a substantial amount of time and money attempting to collect on return items, often with minimal recovery. Checks are still a popular payment method, despite the rise of online and mobile payments in recent years. RCK is a way businesses can protect themselves from loss due to NSF items.
How does RCK work?
When a business deposits a customer’s check payment, its financial institution presents the check to the customer’s bank. Either the payment is processed or the bank returns the check as NSF. If the check is returned as NSF, the business can use an RCK solution to submit it to be re-presented to the customer’s account through the ACH network. The re-presented check can only be for face value, but a state allowable return fee can be charged to the customer to cover any expenses associated with collecting the funds. Once the money is collected, it is deposited into the business’ account.
Our Unique Solution – Smart Returns
NSF checks must take a specific route in order to be processed, so most RCK programs use similar methods to re-present checks. However, Unity FI Solutions offers a unique RCK solution, called Smart Returns, that electronically re-presents returned checks up to two times for collection and lets the client choose the re-presentment schedule. This can lead to as much as a 90 percent collection rate. It also allows your business to resubmit return items immediately, saving significant time in the collection process.
In addition to offering a customized re-presentment schedule, Smart Returns offers many unique and personalized features. The solution provides an intuitive user interface that can be “white labeled” to seamlessly integrate into your brand’s established look and feel.
Smart Returns offers 24/7 access to NSF check images and the option to upload paid data files to the accounts receivable system. In addition, Smart Returns offers a fee income function so that businesses do not have to separately apply processing fees to their customers. Our experienced team at Unity FI Solutions will also handle all customer service inquiries related to Smart Returns.
There is no equipment needed for Smart Returns. You can access the software and all of your information through one convenient online portal.
RCK for ACH originated transactions
RCK can also be used for Automated Clearing House (ACH) originated transactions. The Smart Returns system is capable of receiving daily NACHA return files. Once in the system, it allows a merchant or business to re-present the returned ACH item by originating a new ACH debit transaction in order to collect owed funds.
Benefits of RCK
The benefits of RCK are immense for both businesses and their consumers. The streamlined service offered by Smart Returns allows your company to focus on its core business, rather than spend time chasing down returned checks. It is also beneficial to your customers, allowing them to pay their debts and return to purchasing.
Key benefits for merchants and customers include:
- Benefits to merchants
- Reduced staff-hours spent attempting to collect on return items
- Significantly reduced collection costs
- Faster and more efficiently processed payments – Smart Returns typically reduces the return item recovery period to five business days. Businesses that do not use an RCK solution often spend much longer or never get the money owed to them.
- Up to a 90% collection rate that goes straight to the bottom line
- Benefits to customers
- Expedited return item processing
- Faster return to “ready to buy” status
- Eradication of negative file records
Who can use RCK?
Any business that receives checks as a form of payment can benefit from having an RCK solution like Smart Returns in their toolbox. The more checks a business receives, the more likely it is to receive NSF checks and have a need for this type of solution. Nearly any type of business can benefit from an RCK Solution, but some common business types include:
- Stores – grocery, department, convenience, etc.
- Schools and daycares
- Apartment communities and other rental companies
- Professional service businesses
- Utility providers
- Not-for-profit organizations
When can you use RCK?
Due to financial regulations, not all checks can be re-presented. The eligibility requirements for NSF checks or other return items to be re-presented include factors such as consent, item amount and timeframe. Although Smart Returns will help your business recover funds, it is important to be familiar with constraints on the collection of NSF payments. Some of those constraints include:
- The customer must be notified. Verbal consent is not required. Consent can be obtained by posting a sign at the point-of-sale or by having the verbiage on the agreement or sales slip the customer signs.
- The check must be returned for NSF
- The check must be less than 180 days old
- The check must be for an amount equal to or less than $2500
- The check must not have already been presented twice electronically. A check is allowed a total of three presentments, one physical and two electronic.
RCK Compliance at Unity FI Solutions
Smart Returns operates in compliance with the Federal Reserve, the Electronic Funds Transfer Act, the Uniform Commercial Code and the National Automated Clearing House Association (NACHA). All NSF re-presentments are subject to NACHA regulations and are reviewed before processing.
RCK is rapidly growing as a way for businesses to drastically improve their collections process. NACHA estimates that more than 3.8 million RCK transactions were completed in 2014 alone. If your business in interested in improving the way it collects on return items, contact us. Our experienced team can walk you through your options and help custom design a solution that is tailored for your specific needs.