f someone told you of a free product that reduces merchant check losses and provides income opportunities for ISOs and merchant level salespeople (MLSs), you might say it sounds too good to be true.

But, it is true thanks to Secure Check RCK, a company providing an automatic, electronic check re-submission service that recovers nonsufficient funds (NSF) checks 24/7/365. Secure Check National Sales Director Jay Colvin said, "The ISOs and MLSs are all talking about the shrinking margins and noncompetitive situations they face daily and how they wish things could be different. Guess what? Here it is and it has no liability, no risk, no cost and no work."

Secure Check RCK is a spinoff from Secure Check Cashing Systems Inc. "Secure Check was an early pioneer in the industry and was founded in 1999 shortly after NACHA approved the RCK [re-presented check entry] method for recovering returned checks," Colvin said.

As Secure Check grew, its focus shifted toward electronic transactions rather than RCK. "As the years went on, Secure Check increased its reach, developing systems to facilitate electronic transactions, particularly in the Internet industry," Colvin said. "As a result, not enough people were made aware of the huge advantages of RCK."

In 2005, the RCK portion of the business was sold to a group of investors, and the new, independent Secure Check RCK was formed. Pat Forbes, who was active in the parent company, was named Chief Executive Officer.

Here's how its RCK program works:

• When a customer's check is returned for NSF, it is automatically forwarded by the merchant's bank to Secure Check RCK.
• Secure Check RCK converts the item to an electronic transaction and processes it through the automated clearing house system.
• Using the ATM network, Secure Check RCK checks the customer's bank account information to determine which checks will clear each day.
• When the funds are available, the money is recovered, along with an NSF fee.

Secure Check RCK reports that this process yields positive collections five times faster than other methods.

Colvin said the company is experiencing more than 1,000% growth with its merchant base and triple-digit growth with MLSs. "Because Secure Check's system is internal and nothing resides at the merchant's location, it's unlikely that we could ever be outpaced by our own growth, and we don't have the capital constraints of companies that have to fund and deploy equipment," he said.

Free and easy

Secure Check RCK is easy for ISOs and MLSs to offer to merchants because no equipment or setup is required, and there is no cost. Secure Check RCK establishes the bank interface and hosts the system. Merchants use the service for free and receive the full face value of "bad" checks.

Secure Check RCK and sales agents are compensated from the electronically recovered state-authorized fee that is paid by the NSF check writer. Sales agents receive up to $16 per check.

If you are skeptical and think "up to $16" means "usually much lower than $16," there is good news. Secure Check RCK guarantees a minimum of 40% on all recovered fees. This percentage is for all recovered checks, whether they are collected via RCK or optional secondary collections. The average fee paid is $30.

Secondary collections occur when a check is not eligible for electronic collection. In these cases, Secure Check RCK contacts the check writer via phone or mail.

Rather than use harassing collection agency tactics, the company strives to make amicable arrangements for repayment. It wants to preserve the merchant/customer relationship. If the check writer still refuses to pay, Secure Check RCK refers the case to its attorneys.

Complementary, not competitive

If you represent check guarantee and verification programs, you may wonder why merchants would need RCK if they currently have check solutions: Secure Check RCK isn't out to compete with traditional check guarantee, verification or conversion programs.

"We increase merchant understanding of the value they bring to themselves [when they] gladly accept checks," Colvin said. "We are the perfect complement to all check guarantee, check authorization or ECC [electronic check conversion] programs, thus giving the agents a more robust and complete offering."

Also, Secure Check RCK reports that 97% of retail and commercial merchants don't use a check service; they find it cost prohibitive. "We realized that for certain segments of the retail market, other check products, such as verification or guarantee models, just weren't economically feasible," Colvin said.

"Secure Check RCK was founded to fill this gap with an easy, quick and completely efficient system to recover merchants' checks that were returned for nonpayment."

Bounteous benefits

Another attractive feature of the program is Secure Check RCK's collection rate: It collects nine out of 10 RCK checks. This is because it uses the ATM networks to electronically verify bank account information daily. In contrast, Colvin said, its competitors typically perform such inquiries twice a month.

Merchants who use Secure Check RCK can also reduce bank fees. Many banks charge from $5 to $20 for each redeposit, whether or not the funds are recovered. Secure Check RCK merchants do not incur such fees (after the check's initial return).

According to Colvin, merchants who have added Secure Check RCK to their services have increased their recovery rates by 50% to 75%.

Service for all

Committed to customer service, Secure Check RCK strives to create an environment in which everyone wins. "If any of our internal and external customers ask for anything, the answer is, yes, as long as it makes good business sense, isn't illegal or immoral," Colvin said.

"The bottom line must be, everyone must be a 100% winner or we have no deal - the merchant, the agent and then us - a true win-win-win program."

Secure Check RCK notifies merchants via fax, e-mail or snail mail when a check is returned NSF or when checks exceed a predetermined amount. Merchants and ISOs can also view all account activity and history via the company's online reporting system.

They can also view the check image, as well as the date written, check value and check writer's name. ISOs and MLSs can view their commissions in real time as well.

"Our goal is to consistently deliver the highest ethical standards while making raving fans out of our merchants, agents and end users," Colvin said. "And if you ask around, I think you'll find we are doing a pretty good job."

Partner paradise

Secure Check RCK has no plans to create an internal sales force. "We see no need at this time," Colvin said. "Besides, we do not want to compete with those already in the field, as the RCK program is a match made in heaven for ISOs and merchant level sales agents.

"Merchants do not need more salespeople calling them. So we are forging partnerships with those already in front of merchants."

Secure Check RCK expects when agents begin offering its RCK program, they will increase their earnings by at least 30%.

The company offers agents an opportunity to increase merchant retention and add variety to their service offerings without increasing costs.

"MLSs can go back to their current merchant portfolio and give our RCK program away as a thank you gift, thus helping increase their merchant retention and satisfaction and commissions monthly," Colvin said.

In addition, ISOs and MLSs can benefit from Secure Check RCK's endorsements by organizations like the Louisiana Hospital Association. Colvin said such endorsements help agents gain access to difficult entry markets, such as the health care industry.

To sign merchants up, MLSs need only a fax signature on a one-page, 30-day agreement; a voided check; and a bank-forwarding letter that Secure Check RCK provides. And all deals are customizable. "We handle everything after the paperwork is faxed in," Colvin said. "This should be an automatic on every deal an MLS goes in on."

Commission opportunities

Secure Check RCK offers four types of commissions: residual programs designed for large and small ISOs; agent commission programs for independent agents who want to give the program away to their merchants; ongoing commissions for referrals; and card Association and agent bank programs that pay commissions for leads and signed deals.

"Our basic MLS program pays from two income streams," Colvin said. "First, at a minimum, we pay 40% of the state-allowed fee on all recovered/collected checks. Commission raises based on production are also available and easily achievable."

The company also offers a bonus on checks that must go to manual collections. To help agents get started, it provides ongoing training and lead development.

Colvin and his company believe all merchants will someday use RCK, so there is no time like the present for ISOs and MLSs to take advantage of RCK's revenue opportunities.

"They [MLSs] need to know it isn't a matter of if their merchants will have RCK; it is now a matter of when," Colvin said. "Secure Check RCK is no-brainer sales because of the simple fact it costs neither the agent, MLS, ISO nor the merchant any money or requires any work."