Cloudy / 16° F
Local check acceptance changing
Published 12:00pm Monday, September 29, 2008Some Fergus Falls businesses are starting to say “no” to checks — and the economy may be to blame.
Northern Aire Lanes stopped taking checks recently after seeing a record number bounce due to non-sufficient funds (NSF).
“It’s primarily the number of NSFs we received,” said owner Steve Loeffler. “The number we received last year was up from the previous year.”
Many bad checks led to closed accounts, Loeffler said, and would have required a collection service — and accompanying fees — to track down. With rising gas and food prices, Loeffler said he expects the number of bad checks will rise.
That is a very real possibility, according to Steve Daggett, president of Midwest Bank in Detroit Lakes and board member with the Minnesota Bankers Association. As essentials grow more expensive, people may write more bad checks as they get used to higher prices at the pump and the grocery store checkout.
“Maybe they typically had a little bit more of a cushion in their account and they don’t have that cushion anymore,” Daggett said.
For business owners, the upside of accepting checks is avoiding the fee associated with the credit card exchange.
“If they did take checks, they don’t have to pay that fee,” Daggett said. “The down side of accepting a check is you don’t know if the money’s good.”
Bad checks prompted Dairyland to stop accepting checks altogether in April, said owner Jean Connelly. Over a year’s time, the business lost $300 to $400 after accounts registered non-sufficient funds.
Yet Fergus Falls businesses vary in their encounters with bad checks, and checks are still accepted at many locations. Victor Lundeen Company only sees a handful each year — a number that hasn’t changed much with the worsening econom, staff say.
“We have very minimal (bad checks) that we get,” said store manager Paul Lundeen, “maybe four a year.”
