TeleCheck is a specialty consumer reporting agency that offers a service to merchants to help assess the risk of taking a customer’s check.
What is a bounced check?
A bounced check, also known as a returned check, is a check that is not honored by the bank on which it was drawn. This typically happens when the person who wrote the check does not have sufficient funds in their account to cover the amount of the check.
When a check bounces, it is returned to the payee, and the payee may be charged a fee by their bank for the bounced check. The person who wrote the check may also be charged a fee by their bank, and their account may be subject to additional penalties or restrictions.
And, one bounced check can land you in TeleCheck.
Here is one woman's story in her own words:
In 16 years of having our joint checking account, we recently had one $40 NSF check due to forgetting to subtract an automatic monthly debit from the account balance. This is the ONLY NSF check that either my husband or I have ever written in our lives. We immediately made a deposit in our account and made sure the merchant issued the NSF check was paid.
TeleCheck informed us that we should wait 10 days, then start using the checking account again. We did as instructed and our checks were once again accepted at merchants using TeleCheck. 7-8 weeks after the NSF check incident, we had a check refused at a merchant using TeleCheck.
After calling TeleCheck and going through all the lengthy automated procedure, I was finally able to speak to a representative. Basically I was told that the only way I would ever know if my check would be accepted was to go shopping, buy something, and wait at the check-out (holding my breath) to see if the check would be accepted or rejected.
The Problem With TeleCheck
Writing a check has become similar to using a credit card because TeleCheck’s service authorizes check transactions and converts paper checks into electronic items at the point of sale. Your check will either be approved or declined – similar to using a credit card at the point of sale. It’s a crappy system that leaves customers standing at the register often shocked or embarrassed.
What’s worse is when you clear a denied check transaction, you really have no way of knowing if your check will be accepted again. Once in the TeleCheck matrix, it can become a store-by-store experience. You have an excellent banking history until one mishap with a bounced check and get reported to TeleCheck.
What To Do When Reported To TeleCheck
It’s good this consumer took action when she was reported to TeleCheck because many don’t. Be sure to request the code given to the merchant when TeleCheck declines your check. The merchant should write down the code and give you a number to call but that does not always happen.
If you've been reported to TeleCheck for a bounced check, there are a few steps you can take to resolve the issue:
Contact TeleCheck to get more information about the issue and what steps you can take to resolve it. Get the exact reason your check was declined by contacting TeleCheck by phone or online at:
Declined Check Information for Check Writers
+1 (800) 366-2425
Look up your decline code online.
Make good on the bounced check
You will need pay the bounced check, including any fees or penalties that may have been incurred. You may also need to contact the recipient of the check to arrange payment. TeleCheck will typically remove you from their database once the debt is paid.
Check your TeleCheck Report
Check your TeleCheck report to make sure the information being reported is accurate. It's not uncommon to have your information linked to another check writer's information due to identification numbers incorrectly keyed at the point of sale (merchant).
TeleCheck can be disputed if there are errors or inaccurate information in your report. This is important because information in TeleCheck can remain up to 7 years. Order your free TeleCheck Report at:
Free annual file disclosure pursuant to the Fair Credit Reporting Act
+1 (800) 366-2425
Request your consumer file report online.
Take steps to avoid future bounced checks
To avoid future bounced checks, make sure you have sufficient funds in your account before writing a check. You may also want to consider using electronic payment methods, such as online bill pay or direct deposit.
Consider getting overdraft protection
If you don't have overdraft protection, consider signing up for it. Overdraft protection is a service offered by multiple banks and is often a free service at online banks to help prevent you from overdrawing your checking account.
This service can be linked to your high-interest savings account or you can sign up for an overdraft line of credit. If you don't have enough money in your checking account to cover a payment, the overdraft protection will kick in and use funds from your linked account or line of credit to cover the payment.
Banks like Chime offer free overdraft protection up to $200 through its SpotMe feature without requiring a line of credit.
It's important to talk to your bank representative to understand the options available and any associated fees.
More TeleCheck Resources
- Learn common reasons why TeleCheck denies check writing privileges.
- Check out everything you need to know about TeleCheck.
- Read how to dispute TeleCheck if your report contains errors.
- You can check your ChexSystems score free of charge.