Learning Center
Relying on Paper Checks: A Risky Business for Small Companies
Updated October 2026. Originally published May 29, 2024.
In our increasingly digital world, paper checks may seem like a relic of a bygone era, yet they remain a common payment method for many small businesses. However, relying on paper checks isn't just outdated, it's also a risky practice.
What are the risks of accepting paper checks?
Accepting paper checks exposes a business to fraud, delays and extra work:
- Fraud: Checks are the payment method most often hit by fraud. In the Association for Financial Professionals (AFP) 2025 survey, 63% of organizations reported attempted or actual check fraud in 2024.
- Mail theft: Checks can be stolen, altered or counterfeited in transit. AFP found 23% of organizations experienced check fraud tied to mailbox theft.
- Slow access to funds: Checks must be mailed, deposited and cleared before the money is usable.
- Manual reconciliation: Matching paper checks to invoices takes staff time and invites errors.
- No guarantee of funds: A deposited check can still be returned, so revenue is not certain until it clears.
Why should small businesses stop accepting paper checks?
Small businesses have less room to absorb a fraud loss or a payment delay. Digital payments reduce the physical handling that makes checks easy to steal, and they speed up access to cash. Moving off checks also cuts deposit trips and manual data entry. Banking regulators and the U.S. Postal Service have both warned about check fraud, which is why shifting to a secure digital method is a practical priority for small companies.
How big is the problem of paper checks in business payments?
| Statistic | Figure | Source |
|---|---|---|
| Organizations experiencing attempted or actual check fraud, 2020–2024 | 63%–66%; 63% in 2024 | AFP 2025 Payments Fraud and Control Survey |
| Organizations with no plans to reduce check use in the next two years | More than 75% | AFP 2025 Payments Fraud and Control Survey press release |
| Organizations that experienced check fraud from mailbox theft | 23% | AFP 2025 Payments Fraud and Control Survey |
| Check fraud Suspicious Activity Reports filed by U.S. financial institutions in 2024 | About 682,000 in 2024, roughly double the 350,000 filed in 2021 | FinCEN data; Thomson Reuters Institute analysis, summarized by OrboGraph |
| Reported suspicious activity associated with mail theft-related check fraud, February–August 2023 | More than $688 million, including actual and attempted transactions | FinCEN financial trend analysis, September 2024 |
How are businesses moving away from paper checks?
Businesses are switching to ACH, real-time payments and virtual cards, and many are enrolling in a network that accepts payments electronically. For a business that receives payments, a practical route is a network that sends funds electronically without changing existing systems.
How BillGO Exchange helps
BillGO Exchange is a small business payment network that allows businesses to accept digital payments from customers who pay their bills online through their bank’s bill pay system. If a business is not enrolled in a digital payments network, their customers’ digital payments are delivered to them as paper checks. There is no fee to enroll, no long-term contract to sign and no system reconfiguration, and members can opt out at any time. Payments integrate with existing accounting platforms, such as QuickBooks, to reconcile automatically. Learn how BillGO Exchange works.
How to move from checks to digital payments
- Choose a provider that fits your setup. Look for one that needs no new software, adds no extra fees and integrates with your existing systems.
- Keep training minimal. Pick a platform with payment data that makes reconciliation easy.
Frequently asked questions
What are the risks of accepting paper checks as a business?
Fraud (63% of organizations reported check fraud in 2024), mail theft, slow access to funds, manual reconciliation and no guarantee of funds until the check clears.
Why should small businesses stop accepting paper checks?
Small businesses have less capacity to absorb fraud losses and delays. Digital payments reduce fraud exposure, speed up access to cash and cut manual work.
How big is the problem of paper checks in business payments?
About 63% of organizations experienced check fraud in 2024 according to AFP, and U.S. financial institutions filed roughly 682,000 check fraud Suspicious Activity Reports that year.
How hard is it for small businesses to switch from checks to digital payments?
It can be simple. BillGO Exchange has no additional fee to join the network and requires no system reconfiguration, and enrollment support is available.