Beyond just inconvenience, check payment systems can be a serious burden to developmental disabilities service providers. The hidden costs of using checks can inflate your operational costs, prevent efficient cash flow, and add difficulty to the expense reporting process.
Here are four reasons why your organization needs to eliminate checks and choose a smarter payment tool.
Using check systems will cost your organization in the long run. The cost of postage and checkbooks adds up quickly — plus you have to consider the labor cost of actually writing and mailing checks. When your goal is to keep operational costs as low as possible, checks unnecessarily dig into your budget.
Prepaid cards are a fixed-cost solution that can save you money. There’s no risk of overdraft or late payment fees, as with credit cards , and you can better control how your staff members are spending. With prepaid cards, you can make staff spending power hassle-free.
Unreliable access to funds
The spending needs of your organization are complex — your staff members have to make purchases to keep everything from transportation to in-home care running smoothly. But if you rely on checks to transfer funds, staff members don’t have the flexibility to respond to last-minute purchase needs. The outdated payment method creates purchase delays and can turn small facility maintenance needs into extended ordeals.
Prepaid cards allow staff members to securely make purchases. You can transfer funds and adjust balances in real time as the needs of your staff members change. Cards with freeze protection make it safe for staff members to carry cards with them whenever they’re on the job.
Inefficient spend control
Checks give you approval power over every purchase — but this oversight comes at a huge time cost. You may not want to sign off on every small, routine purchase that your staff members make. If one person has to handle both long-term financial stewardship and day-to-day operations, check systems waste time that could instead be spent refining (and trimming) the budget.
With an expense management platform, you can establish automated spend controls and ensure funds are being used appropriately. Set daily limits or restrict purchase categories for comprehensive control over spend. With spend rules customized for individuals or groups, you can maintain control and better manage cash flow as your needs evolve.
Lack of visibility
Transparency is fundamental to your organization: your relationship with those you serve and the greater community depends on trust. But checks add complications to financial management. Checks take a long time to reconcile, and make expense reporting a lengthy and tedious process.
Cloud-based reporting platforms give you real-time insight into expenses. Cloud storage, combined with a mobile app, gives you the flexibility to review transactions anywhere on your mobile phone. You can address any questions or discrepancies immediately, and generate more accurate expense reports.
Replacing check systems with PEX can save time and money while improving transparency for your organization. PEX is a leader in next-generation expense management solutions for nonprofits. With PEX, developmental disabilities service providers can better manage expenses, establish budget controls and regulate cash flow — all of which reduces your monthly expenses and saves time on expense reporting.
To learn more about PEX for developmental disability service providers, download our Guide.