Check Draft and Demand Draft Explained

How to create a check draft?
What is a check draft, or check draft software?
How to accept checks and create check drafts?
Can I create a check draft or demand draft?

Checks By Phone

Accept Checks By Phone.

Checks By Fax

Accept Checks By Fax.

Take Checks Online

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Any business can create a check draft.  Also called a demand draft, a check draft or a Remote Created Check (RCC), a check draft is a legal copy of the check that is created by the merchant, and authorized by the account holder, but not created by the account holder.

A regular check is created by the account holder, and signed (authorized) by the account holder.  A regular check is then given to the merchant and is considered an original item.  Checks have certain requirements as to how they are printed, what ink is used, and require the signature of the authorized signer on the checking account.

A check draft is created by the merchant, and the signature is not required. The account holder must authorize the merchant to create a check draft, and this can be done by phone, fax or online.

Authorization is indicated on a check draft in the signature blank, usually by a statement such as the following: “This draft is pre-authorized by your depositor, no signature required.”.

Demand Drafts are often called checks by phone, checks by fax or online checks because authorization can be obtained this way.  The actual draft is the physical item that is printed by the merchant.

CheckWriter™ software is designed specifically to create a draft of the customers check for deposit into any U.S. bank the same day.  It will print a Check21 compliant RCC item that is also EPC-6 encoded.

How to:
Accept checks by phone, checks by fax or take checks online from customers, just like you would take credit cards. Using an existing shopping cart, secure web form, or third party payment form online will allow  you to gather all of the information you need to accept checks online and create a draft of the check.

Once you have gathered the information from your customer, CheckWriter™ software will print a physical draft of the check for deposit into any bank the same day.

Demand drafts are For Deposit Only items and typically cannot be “cashed” like a regular check.  Checks can be paid to a third party, cashed at the grocery store or check cashier, or presented for payment at the issuing bank for cash.

Unlike a check, a demand draft is for deposit.  This is one way banks cut down on fraud.  You must deposit a check draft into a bank account, creating a paper trail.

Because once they are deposited, banks treat your draft just like a regular check, your funds should credit to your ledger balance the same business day.  There are almost never fees associated with check drafts, and a draft will clear just like a regular check.  The account holder will get back the physical item you deposit, or image per the terms of their account statement.

What next:
CheckWriter™ will print a draft that you can then deposit into any U.S. bank the same day.  The draft will be treated just like a check you receive through the mail or over the counter.  Just endorse the back, and make your deposit.  You can deposit a draft into the ATM machine, use a smart phone, check scanner, lock box service, or you can bring it to the teller.

Benefits to creating drafts:
Check drafting is a fantastic way to take payment.  The benefits go on and on with taking drafts over any other eCheck solutions like ACH.

– Drafts are treated just like a check you get through the mail.
– Check drafts credit to your ledger balance the same day.
– Demand drafts have no fees associated with them.
– Check drafts are created onsite with no third party processor.
– No merchant account is required to create check drafts.
– Strict ACH regulations published by N.A.C.H.A. do not apply to drafts.
– Any business, including telemarketing, credit repair and others can use.

CheckWriter™ Software and Creating Check Drafts / Demand Draft:
When you use CheckWriter software, the draft is automatically formatted and when printed properly, it will comply with all regulations for printing a check draft and creating a demand draft.

Simply take the customer’s check by phone, take the check by fax, or take the check online at your website, then enter or import the data into the CheckWriter™ software and it will create a perfect check draft every time.

CheckWriter software will allow you create check drafts, also known as demand drafts. Because CheckWriter™ complies with all regulations, and standards, any business can use the software to take checks by phone, checks by fax or checks online without the concerns of formatting, or learning complex rules or guidelines.