What Sears is doing now with handwritten checks

Aug 7, 2009 12:23 PM

As people try to hold the line on credit card purchases, they may be turning to an old standby: the humble check. You know, the paper kind with funny designs and big Gothic type initials and scrawled signatures.

Using a check can give you more control on the flow of money out of your account. Usually it takes a few days for a check to clear from your account, unlike a debit card, which takes out the money more quickly.

But using checks is getting more complicated.

A recent shopping trip at my local Sears store suggests that the day may be not too far off when it really becomes a paper debit card.

When I tried to buy a pair of shoes with a check last week, the clerk took the check, but said I also had to sign their electronic pad, which is the place where you normally sign for credit cards.

It had a dense paragraph of legalese—which I actually took the time to read, much to the annoyance of the few customers on line behind me. Among the things it said was that I would be authorizing Sears to do an electronic funds transfer from my bank account.

I asked the clerk why I needed to sign this electronic pad, since I had already signed a check over to Sears. Isn’t that the whole idea of a check?

A store manager came over and told me it was their new system for processing checks. I said it was fine for them to set up a new system just as long as it didn’t involve my approving an electronic funds transfer.

We were at an impasse and I decided to cancel the sale rather than hold up the line and yield my electronic signature, scratchy though it might be.

An interesting epilogue: Two days later, I noticed in my online banking tally that Sears actually did cash the check even though I didn’t sign the pad. They then gave me a full refund the same day. So they didn’t really need my signature after all and took the money anyway. What gives?

A spokeswoman from Sears says that it is part of a switch to a new vendor called TeleCheck, which guarantees the check. Checks are now being processed electronically at the counter, which means they will clear faster for Sears and money will come out of your account more quickly. The pad provides proof to TeleCheck, the spokeswoman said, that you know they are clearing your check this way.

And if you won’t sign? They can clear the check anyway.

Have you had a similar experience using checks at Sears or other stores? Let us know below.–Bob Tiernan

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