Paymentech, eFunds letting e-retailers contribute to bad-check database
Until now, retailers could contribute information on bad checks to the eFunds SCAN database only from store transactions, leaving online scofflaws free to pass checks undetected by SCAN. Paymentech Inc. and eFunds are now letting online retailers contribute data to SCAN, or the Shared Check Authorization Network, which accounts for about 44% of the check verification market.
"Now that we’ll have two retail channels cooperating, the value proposition for using SCAN is better," says Larry De Palma, director of product management for Paymentech. Although online retailers have been able to access SCAN to verify the credit status of check writers, the database only recorded information on bad checks passed in stores and other brick-and-mortar operations, including utility companies. But this is the first time retailers are able to contribute to SCAN bad-check information related to online retail orders, De Palma says.
Paymentech expects the new service to be used mostly by large retailers, including one large specialty retailer that is beginning to provide the network connections to contribute data, De Palma says, adding that he was unable to name the retailer. Large retailers are the most likely prospects because of the check volumes needed to get a return on the investment of setting up data feeds with SCAN, he adds. Retailers must be able to electronically transfer bad-check data to SCAN. Small online retailers who want to contribute bad-check data to SCAN have the option of using third-party integration software, de Palma says.
To access SCAN for verification purposes, users pay from 10 to 25 cents per transaction, depending on volume, De Palma says.
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