Nowadays, with the popularization of digital payment methods, such as instant transfers via PIX, digital wallets, and even cryptocurrencies, it is easy to imagine that the check, a very traditional payment method, has fallen into disuse. However, this is not the reality in many countries. Although the use of checks has decreased significantly in recent decades, it is still relevant in some specific situations, such as large-value transactions between companies, or in places where access to more modern forms of payment is limited.
In this article, we’ll explore everything you need to know about using checks today, their pros and cons, and the scenarios where they can still be useful.
Brief History of the Check
Checks are a form of payment that dates back hundreds of years. They were created as a safer way to move large sums of money without having to carry coins or gold bars, and allowed people to make transactions between bank accounts. In Brazil, checks became popular in the 1960s and 1970s, and by the end of the 20th century, they were widely used by both businesses and consumers for everyday purchases and large transactions.
Over the years and with the evolution of banking technology, checks began to be replaced by credit and debit cards, bank transfers and, more recently, instant payments.
Is the Check still used today?
The answer is yes. Although the use of checks has decreased drastically, they are still used in several specific situations. Here are some of them:
High-value business transactions:
Some companies still prefer to use checks for large payments, especially in contracts involving large amounts or where there is a need for physical proof of payment. This can occur in construction contracts, real estate transactions, or even when purchasing vehicles.
Places where access to technology is limited:
In rural areas or areas with less technological development, where access to the internet and mobile devices may be restricted, checks are still a safe and practical way to carry out transactions.
People who prefer the traditional:
There is also a profile of people, usually older, who still maintain the habit of using checks, either out of familiarity or trust in the method. These people often prefer the tangibility of the check rather than relying on digital systems.
Guarantee in rental or installment contracts:
In rental contracts or installment purchases, a check is often requested as a guarantee of payment, as it offers the landlord or seller greater security that the amount will be paid.
Advantages and Disadvantages of Using Checks
Like any payment method, checks have their pros and cons. Let’s look at them below:
Financial control:
For those who struggle to keep track of their spending with cards or digital transfers, checks can offer a more tangible way to manage their finances. Each check issued needs to be recorded, which helps to provide a clear view of payments made.
Security in large transactions:
A check can be considered safer for large-value transactions, as it provides physical proof of the transfer and, in the event of problems, can be traced.
Acceptance in certain niches:
Even with the increasing digitalization of payment methods, some sectors still prefer the use of checks, whether out of tradition or for contractual reasons.
Disadvantages of Using Checks:
Slow processing:
Compared to instant payments like PIX, checks can take days or even weeks to clear, especially when they involve large sums or transactions between different banks. This can be inconvenient in situations that require agility.
Possibility of fraud:
Although there are security mechanisms, such as signature verification, checks are subject to fraud, such as forgery or issuing bad checks. Digital payment technology is generally more secure, as it involves multiple layers of electronic protection.
Disuse and unfamiliarity:
With the popularization of digital methods, the number of places that accept checks has been decreasing. Many stores, service providers and even large companies no longer accept checks as a form of payment.
Check vs. PIX: Which is the Best Option?
With the advent of PIX, the payments landscape in Brazil has changed dramatically. PIX allows you to transfer money instantly, 24 hours a day, 7 days a week. So why still use checks?
While PIX is excellent for most everyday transactions and even for large amounts, it has some limitations, such as the fact that it does not offer the tangibility of a physical receipt or can be used in contracts that require greater formality. In addition, some people and companies still prefer traditional methods, such as checks, for reasons of trust and security in high-value transactions.
However, for most situations, PIX ends up being a faster, safer and more efficient alternative than a check.
How to Issue and Clear a Check Today
If you need to write a check, it is important to know how to do so correctly, as many people, especially younger people, may never have written a check before.
Issue:
To issue a check, you must correctly fill in the information such as the amount in words, the date and the signature. It is also important to ensure that there is sufficient funds in the account to avoid the check being returned due to insufficient funds.
Compensation:
After a check is issued, it must be delivered to the person or company that will receive the payment. That person will then deposit the check into your account, and the bank will clear it, which can take a few days. In general, checks clear faster for smaller amounts and between banks within the same institution.
Conclusion
Although checks are no longer as common as they once were, they still have their place in certain contexts. For large-value transactions, formal contracts, and areas where access to technology is limited, checks can be a valid option. However, with the rise of more modern and efficient payment methods, such as PIX, the trend is that the use of checks will continue to decline. It is up to each person or company to assess whether it is still worth using them or migrating to faster and safer options.
