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All about Check Conversion/Truncation
Check Conversion/Truncation is one of the newer developments in electronic payment
processing. It is a process by which a checking account is immediately debited
electronically.
Processing a check conversion is a two-step process:
1. Process whatever check Sale transactions you have for that particular day.
2. As with credit cards, there is secondary transmission of information needed to
complete a transaction. This is called Truncation Close.
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Note: The important thing to remember is that without re-transmission of the
check information, you will not receive your money. Every day that you perform
truncations you should perform a truncation close after all transactions are
complete.
Check Conversion Up-Close
Check Conversion takes verifying one step further. The first step is to verify/guarantee the
check. The second step is to have the funds electronically moved from your customer's
checking account to yours.
There are a few different types of check truncation/conversion transactions. We often refer
to the different types of transactions as actions. Here is a list of actions with general
descriptions:
1. Verify -- This action allows you to verify that a checking account exists for your
customer and guarantees that the amount of the transaction is available. This action
also allows you to perform the first half of a sale transaction. This action does not
make information available for re-transmission.
2. Sale -- This action reduces the balance of your customer’s checking account. A sale
actually performs two functions. First, a sale will Guarantee a check. Second, it will
make the transaction available for re-transmission.
3. Void -- This action removes a Sale or Forced transaction from the re-transmission
information. You will be deleting the transaction. You will not get the funds from this
transaction. Use the Void Sale action to correct mistakes and on same day returns.
This action can only be performed before re-transmission.
4. Force -- This action makes a verified check transaction available for re-transmission.
A Verify followed by a Force is equivalent to a Sale.
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