If a check goes missing, the inventory list will reveal the problem.Īudit trails are essential for bank security if that bank is using pre printed checks. This audit trail is essential for tracking the movement of checks throughout the bank. At the end of the day, the checks are returned to the vault, and the inventory is updated. When a check is used, this is noted in the inventory. These checks spend the day locked in a drawer, unless they are issued to a customer. Which checks have been removed is noted on the inventory before they're handed out. Pre printed checks are counted and inventoried before they are placed in the vault for secure storage.Įveryday, some checks are removed from the vault and distributed to tellers. To mitigate the security risk presented by pre-printed checks, banks create audit trails that allow them to track each check individually. Blank check stock need not be kept locked, checked in an out, inventoried or monitored in the same way that pre printed business checks must be. The risk of fraudulent activity on such stock is low, as long as the MICR technology is itself kept secure. Check stock is not a live check until it is printed. Unprinted, blank check stock is not a security risk because it is blank. Storage and use of live checks must be tightly controlled to prevent fraudulent activity that could cost the bank hundreds or thousands of dollars. They are kept under lock and key and stored in the bank's vault where a small number of them must be accessed everyday to be distributed to tellers. Pre-printed checks are themselves a security risk, because they are "live checks" from the moment they're received by the bank. These expenses are intangible and difficult to measure, so they often go unnoticed by bank executives and branch managers. The security risks and business practices associated with those risks cost banks money everyday. The costs of pre-printed check stock goes well beyond the direct expenses mentioned above. Pre-printed checks also cost $2.13 per check, while checks made with MICR printers and toner cost approximately $0.21 per check. This type of hardware costs approximately $1,000 more than the cost to issue pre printed checks via MICR printer and toner. Pre-printed checks require a laser printer and encoder for every check issuance. Inefficiencies of Pre-Printed Check Stock If you're a banking executive making decisions for your branch or several branches, here's what you need to know. MICR check printing and toner save financial institutions money and time, reduce the risk of fraud and can lead to improved customer service. Many are unaware that pre-printed checks incur tens of thousands of dollars worth of unnecessary expenses every year. Use of pre-printed checks is so ingrained in bank practices that most bank managers and financial executives think little of the associated costs. These checks, and the costs associated with them, have long been perceived as a necessary part of banking. Pre-printed checks have been a standard office supply at banks for decades.
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