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Posted on 
November 30, 2023

Why Paper Checks Aren't Going Away

Listen to some prominent voices, and you'd believe nobody uses paper checks anymore. Like landline phones and floppy disks, paper checks are going the way of the Dodo. 

But not so fast – reports of their decline are much overblown.

Sure, younger generations have gone mostly digital, embracing paperless technologies and instant transactions. However, predictions from the late 1990s that almost all business payments, donations, and tithes would be digital haven't completely come to pass.

In fact, a 2016 survey by SunTrust Banks found that small- and medium-sized businesses still make 57% of all payments through paper-driven processes. Even among millennials, check use stands at almost a quarter. 

So, why are paper checks proving so resilient? What's the best way to keep accepting paper-based transactions? And what are the pros and cons of this donation method? Let's find out!

5 Reasons to Keep Accepting Paper Checks


1. Older Generations Still Use Checks

Yes, the stereotypes are true. Older people are much more likely to use checks. Just because new (supposedly better) technology comes along, doesn’t mean every generation will drop everything they know to adopt it.

Like social media or the internet, uptakes have occurred over decades, and a sizable US population is still reliant on checks as their bread-and-butter payment method.

According to the latest research, while debit and credit cards are common among older people, the paper check remains the trusted payment method for bigger donations. Indeed, newer payment methods have a low uptake in older people – only 13% of over-60s use mobile banking. Meanwhile, three-quarters of retirement-age Americans still use checks. 

2. Older People Give Bigger Donations

Older generations have spent a lifetime accumulating more wealth. That leaves them with more disposable income to spend on tithing. Younger church members, especially those with families, still prioritize giving to the church. However, with young children and squeezed household incomes, they're unlikely to have the cash to spare on large check donations. 

Indeed, due to economic pressures, 17% of US families were forced to reduce the amount they give to their local church. 

3. Even Millennials Use Checks

It's easy to assume that younger generations rely on card, mobile, and cryptocurrency payments as their go-to payment methods. That's certainly true for smaller payments – check usage peaked in the late 1990s and has fallen precipitously.

However, for payments of $500+, checks remain the most popular payment method. Even among younger generations, checks are still a popular payment method. As cited, almost a quarter of US millennials still relies on paper checks, compared to less than 5% in Germany or the UK.

4. No Percentage Transaction Free

Perhaps one of the biggest benefits of paper checks is the absence of percentage-based transaction fees – otherwise common with credit card payments. 

When a church or charity receives a large donation via credit card, a significant percentage of that gift is often lost to transaction fees. That's especially troublesome for churches operating on tight budgets.

In contrast, checks see the full amount go to the intended purpose, allowing organizations to maximize their resources and funding. 

5. Tried-and-Trusted for Larger Payments

Paper checks steadily rise in use the larger the payment made. For donations of over $249, they're used in 10% of transactions.

According to the 2022 Survey and Diary of Consumer Payment Choice, charitable donations, including those from religious organizations, are among the top transactions reliant on paper checks. Some 35% of all donations are made via checks – higher than all other payment methods.

Moreover, paper checks are the preferred method for households with a higher income (over 50%) and those with advanced education. Paper checks are also preferred by rural populations where religious attendance is highest. 

Pros and Cons of Accepting Paper Checks


Pros of Accepting Paper Checks:

  • Familiarity for Older Generations: Many older individuals are accustomed to writing checks and may be uncomfortable with digital payment methods.
  • Higher Donation Amounts: Older demographics, who use checks, often make larger donations, particularly to churches and charities.
  • No Processing Fees: Checks do not incur the percentage-based processing fees typically associated with credit card transactions, meaning more of the donation goes to the intended cause.
  • Inclusivity: Accepting checks allows organizations to cater to those without access to digital banking services or those who prefer not to use them for security reasons.
  • Payment Traceability: Checks offer a paper trail that can be useful for both the donor and the recipient for record-keeping and tax purposes.

Cons of Accepting Paper Checks:

  • Risk of Bounced Checks: There is a risk that a check will not clear due to insufficient funds in the payer's account, potentially leading to fees and administrative hassle.
  • Slower Processing Time: Checks take longer to process and clear than digital payments, which can delay the availability of funds and affect cash flow.
  • Manual Handling and Deposit: Accepting checks requires manual handling, from receiving and recording to depositing at the bank, which is more labor-intensive than processing digital payments.


Experience Automatic Paper Check Scanning with Paperless Transactions

There's no doubt paper check usage has declined, but the continued reliance on checks for higher donations is unlikely to change. Without a reliable way to process checks, your organization will miss out on an important revenue stream. 

We might be called Paperless Transactions, but we know churches and other nonprofit organizations still rely heavily on paper checks for donations and tithes. We're committed to bringing this tried-and-tested payment method into the 21st century. 

Our automatic check scanning hardware and software help you seamlessly enter transactions and donor data from paper checks into popular church management platforms like Planning Center Online and Virtuous.

Learn about services and how they work with our modern solutions that bridge the gap between traditional check processing and contemporary digital management systems.