The Company Checkbook Goes Paperless

Startup Checkbook.io banks on businesses’ desire for hassle-free, low-fee digital checks.


This program was produced by the Marketing Department of WIRED and Ars in collaboration with CA Technologies.

The digital age has few analog holdouts more infamous than the paper check. Someone can send a gigabyte of data across the planet in seconds and in the next instant be scribbling on paper to pay their rent. Apps from incumbents like PayPal to upstarts like Payable are chipping away at the multibillion-dollar payments market from different angles, but few are taking on checks as directly as Checkbook.io.

"Checks aren't going away fast enough because the alternatives to checks are few,” says Checkbook.io CEO PJ Gupta, who was previously chief architect of Visa’s payments network.

Where he wants his new company, founded in 2015, to add value is by not requiring people to create new accounts on other platforms. PayPal serves a lot of consumers, lessening the issue in consumer transactions. But businesses often have numerous accounts and financial regulations to monitor when making payments.

Checks aren’t going away fast enough because the alternatives to checks are few.

— PJ Gupta, CEO, Checkbook.io

A (Digital) Paper Trail

That’s why instead of printing a check, Checkbook simply sends a digital check via email, which someone can print out, if they choose, or deposit to their bank online. The payee can also integrate their bank account info so the digital check functions like a direct deposit.

Having the digital version allows an accounts payable department to keep copies of a check, date of expiration, proof of payment and other documentation required by law. Commercial codes still require a “paper” trail, so an intermediary document, even if digital, is still needed. And in the event of an audit, for example, digital accounting can simplify the process.

Gupta says in the same way that DocuSign and Adobe’s EchoSign are eliminating the need for fax machines, Checkbook hopes to do the same for paper checks—essentially switching out the middleman, not eliminating it. The company is pushing its API to accounts payable departments via direct partnerships and intermediaries, such as QuickBooks. The latter is the company's main source of growth now, as it leverages existing software integrations to win new customers.

A New Financial Technology Stack

Darci Bryan runs The Service Standard, an event staffing and production company in Los Angeles. Her company pays a lot of freelancers. “We want to get it to them quickly because we want them to work for us again,” Bryan says.

She points out that L.A. is a transient city, so when it comes to payables, The Service Standard runs into a lot of returned checks because of employees who have moved. That can mean fees. She wanted an easy solution to pay on direct deposit out of QuickBooks and started using Checkbook via its QuickBooks integration earlier this year.

Now, she says, contractors get paid in less than 15 minutes. She wishes the product had better coordination between e-checks and other paper checks, but the tools have streamlined payables at her small business.

Right now, Checkbook charges businesses a $1 fee per sent check, hoping it will entice companies that are used to paying high transaction fees from credit cards and digital payment solutions. As in any crowded market, Checkbook will have to keep an eye on banks and other incumbents that might cut into their market. Gupta, however, believes banks will be too slow-moving, though he admits that people can already get customized checks from a bank. Gupta just wants his company to be the digital alternative.

 

Caleb Garling
By Caleb Garling | May 31, 2016

Make security a competitive advantage.

We’ll show you how to give users better, safer experiences.

See how >

Subscribe to The Blueprint

I agree to receive information related to The Modern Software Factory Hub and its newsletter, The Blueprint, as well as updates from CA Technologies and/or its partners.

Please fill out all required fields

Want to know what we are doing with your information? Read our privacy notice.

You are now subscribed to The Blueprint.