Frequently Asked Questions About eCollect and
the RCK process
What is RCK? RCK refers
to represented check entries or the process of resubmitting NSF checks
electronically through the ACH Network. We call our program eCollect.
When was RCK approved?
NACHA (National Automated Clearinghouse Association) approved the
new banking that allows merchants to represent NSF checks electronically
on March 10, 1998. The rule became effective on September 18, 1998.
How can merchants benefit from RCK?
RCK or Electronic Check Re-presentment allows the merchant or agent
to time when the check writer's account is debited. This alone can
result in substantial increase in recovery rates. Up to 50% within
the first couple of weeks.
Are there cost savings to the merchant?
Yes, since everything is electronic, there are no redeposit fees charged
to the merchant for resubmitting the checks electronically. There
are no return fees on NSF checks that are returned a second time.
Additionally there are no letters to write or phone calls to make
to the check writers attempting to collect the bad checks.
What can a merchant expect in improvement
of recovery rates with electronic check representment compared to
traditional methods? Merchants using RCK have reported
increases in collection rates from 50% to 85%.
What legal regulations and guidelines
apply to RCK? RCK entries are subject to the applicable
ACH Operating Rules, Uniform Commercial Codes (UCC) and Regulation
CC. However, RCK transactions are originated by check and are therefore
exempt from the provisions of the Electronic Funds Transfer Act and
Regulation E.
What types of checks can be represented?
Checks that indicate on the face that it is being returned due to
"Not Sufficient Funds," "NSF", "Uncollected
Funds" or comparable language.
How many times can the merchant represent
an item? A total of three (3) presentments are allowed.
The RCK entry can be sent twice if there was only one previous physical
presentment, but only one time if there were two physical presentments.
Is there a dollar limit on checks that
can be recovered? Yes, checks with a face value of
$2,500 or less may be processed.
What must the merchant do to inform
the customer? The merchant must notify the consumer
that their return item may be collected electronically if the check
is returned for insufficient or uncollected funds. Notice should be
contained on a sign at the point-of-sale, or on the monthly billing
statement for invoice or remittal companies.
Is there a time limit on checks that
can be represented? Yes, each RCK entry has a time
limit of 180 days from the date of the check.
What items are not eligible for representment?
Drafts drawn on the Treasury of the U. S., a Federal Reserve Bank
or a Federal Home Loan Bank or state or local governments. Postal
Service Money Orders. Items not payable in U.S. currency. Items indicating
on its face that it was returned for reasons other than "Not
Sufficient Funds", "NSF", "Uncollected Funds"
or comparable language.checks over $2,500. Third Party items. Unsigned
demand drafts.
Is the merchant allowed to charge the
check writer a fee for RCK processing? A posted notice
is required by the merchant to inform its’ customer base of
the collection fee and process. A collection fee may not be added
to the amount of the RCK entry, it should be submitted as separate
transaction.
After a check is determined to be NSF,
who retains the paper check when the RCK is initiated?
The Originator, the processor or the ODFI retains the paper check.
Copies may be requested from the merchant or processor via written
request.
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816 Royal Gorge Boulevard
Canon City, CO 81212
Tel: (719) 276-9153
Fax: (719) 276-9157
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