I used to be a fan of those banks you called and could pay your bills over the phone. There was something about paying bills this way which didn’t seem painful. The only problem was that you could only pay certain bills. Well, now finally, there is a way to pay bills, for a price, with your Mac and a modem. Although it still involves real money, this checkbook metaphor program makes paying a little more fun, and, helps you pay on time.
The program is called CheckFree from the CheckFree Corporation, located in Westerville, Ohio a suburb of Columbus. CheckFree has been processing electronic and other types of payments for about nine years for its “commercial” customers. About 16 months ago it started offering its service to persons who own PCs in the DOS world, and finally, it has offered the service to us Mac owners. Basically, the program uses the Federal Reserve system to process electronic payments directly to the accounts of those creditors who are part of an electric payment network, such as those used for MasterCard and Visa. Other creditors are paid with actual Laser printed checks which are copies of your own check or are paid with CheckFree checks drawn on its own account, after they debit your bank account. All of these transactions are done at the CheckFree processing center Westerville.
How it works
You set up your account with CheckFree by sending it the name of your bank, your social security number, and a credit card account number and other information. You also send in a voided check which CheckFree will use to determine your account number and will use when they pay by laser printed check. CheckFree has proprietary software which determines which payment method will be used. Needless to say, most creditors use the electronic method. You also assign yourself a 4 digit ID number which CheckFree uses for all of your transactions. You also supply this information in the program itself as a menu item. (see Figure 1.). ¶
The next step is to create a list of creditors to be paid. (Figure 2.) ¶ CheckFree calls creditors “merchants” and provides a menu item with which identify them by name, exact address and your account number. (Figure 3.) ¶ The address must be exact or there may be a problem in making the payment. Also in the merchant form is a place for you to indicate if this will be a regular (recurring) monthly payment, and if so, how much. Such payments as a car payment and a mortgage or rental payments are appropriate. After the list is complete (you can always add or change information about a merchant) you can send it to CheckFree.
The interface for the program is very much like other checkwriting programs, a la Quicken. CheckFree provides a check register which automatically subtracts the payment amount. You can have the program automatically deduct a regular payment and add a recurring deposit, like a paycheck. When you want to make a payment, you must plan in advance. The program requires that you instruct it to make the payment at least 4 working days prior to the time that you want it paid, presumably the due date of the debt. In fact, the program will not accept payment instructions earlier than four days. If you make a mistake then you must call the customer service department. you may stop payments if you give CheckFree notice at least five business days prior to the due date.
To make a payment, you choose the creditor from the merchant list you previously created . When you click the “pay” button a check appears and you fill in the amounts. Additionally, the program allows you to assign “budget categories” to the various transactions for later sorting and reporting purposes. Again, this is similar to Quicken. There is also a check register which automatically subtracts the amounts of your payments from the running balance. The interesting thing about this is the fact that the program does the subtraction at the time that you enter the payment, even if the payment is to be made in the future. It is also possible to record non CheckFree transactions on the check register both for other checks you write on your own, and for deposits.
Payday!
After you have entered the payments into the program, you are ready for the big moment, or at least the first big moment…sending the information to CheckFree. The program gives you a local access (both 1200 and 2400 baud) number for use with your modem. You simply invoke the menu item called “send” and watch the screen go through the various stages of logging on to the program, sending the information and then verifying the information has been sent. Its over in a flash to (or a baud) and all that you have to do is make sure that there is enough money in the account to cover the transfers when they occur. Your bank account is debited on the due date that you have indicated in the pay command. You can dial up CheckFree any time to update payment or address information.
If there are insufficient funds then CheckFree will charge your credit card and may charge you interest until the amount has been cleared, in the case of a check which CheckFree wrote on its own account, and you may have to pay interest on the amount owed to CheckFree.
CheckFree stores the information in a variety of ways and can generate reports which summarize you transactions by merchant, register, payment and deposit summary, annual report, and year–to–date average monthly amounts for each category. The program can also export files to MacInTax and “other personal financial software packages.” and Excel. I haven’t used this function yet, so I don’t know how well it works.
Does it work?
I have had the program for about one month. It was very easy to set up, and the first few payments which I have made through the system have actually been paid. The manual is relatively easy to understand. The support from the program is good. You can either make a call (non tollfree) or send E-Mail through the local access number. If you chose E-Mail, then you get a written answer to your question sent to you on a post card within a few days. The phone support has been helpful and fast. I have heard from others that sometime their payments have not been made, but that has not been my experience. You get a monthly accounting in your normal bank statement where the CheckFree payments show up as electronic transfers, like other similar transactions.
CheckFree charges $9.00 per month for 20 payments, and $3.00 for 10 additional payments. Your bank account is debited this amount. If you sent 20 payments in the mail, it costs you $5.00 in stamps. So I am paying extra $4.00 for the program, plus the cost of the program, which is now $29.95. There are also various charges to your for returned checks, and stop payment orders. Additionally, CheckFree covers itself fairly well for liability for late payments. It will bear responsiblity for up to $50.00 worth of late charges if the late payment is the program’s fault and you have done everything you were suppose to do in setting up the payment.
The trickiest part of the program is making sure that you have the funds in your bank account to cover all the payments. But this is the same consideration you have when you are calculating the float for your handwritten checks. Like all good financial software, CheckFree forces you to plan in advance. You can’t use this program to pay a bill which must to be paid within 24 hrs (or 48 or 72 hrs., for that matter).
If you get a lot out of using the various money management or checkbook programs, then CheckFree will be familiar and may fit in with your personal financial lifestyle. CheckFree extends the checkbook metaphor to its logical end. Indeed, I have seen it bundled with the DOS version of the Andrew Tobias program. I got the program because it is relatively cheap, I am a sucker for new stuff, and I am compulsively late in paying my bills. I thought that I would try it for a few months. Of course all of this ease of payment costs. But the program is easy to use, and I know that my creditors are happy.
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