ACH options. Back office conversion. Remote capture. Check imaging.

Check-to-ACH conversion options

The changing world of checks is reflected in current and upcoming options in clearing checks through the ACH system. There are now three options, and they all leverage the changes made by Check 21 to provide businesses with check-handling options:

Point-of-purchase (POP) since September 2000
Checks are converted at a cash register and returned to customers as they finish checking out. Check writers must sign an agreement for this to happen. Learn more about POP >>

Accounts receivable conversion (ARC) since March 2002
Checks converted when a customer mails a paper check to pay a bill or drops a check into a drop box. Perhaps you've noticed that your mortgage check payments no longer clear as checks, but as electronic payments. Learn more about ARC >>

Back-office conversion (BOC) since March 2007
Checks written at stores or at manned bill payment locations and converted later in the “Back office.” The requirement for a signature is replaced with a notice. Some other restrictions apply. Learn more about BOC >>

Source: “Helping you prepare for back-office conversion, ” Fedfocus: News from the Federal Reserve Banks, vol. 4, issue 5, September 2006

The FRB also has prepared a side-by-side comparison of BOC, ARC, and POP. NACHA has published a Guide to Implementing a Back Office Conversion Entry Program, which is available from the NACHA website.