Zipmark's payment service targets the dying — but not dead yet — paper check.
Our company "allows businesses to send and receive digital checks to take away the pain – the time it takes to clear and the risk – of dealing with paper checks," says Jay Bhattacharya, CEO of Zipmark.
Zipmark allows both consumers and businesses to link checking accounts so money can be immediately transferred when a payment needs to be made. Zipmark creates the digital check for users to submit for settlement at the participants' banks. It charges a 1% fee and caps its fee at $5 per transaction to make its pricing more appealing than wires.
Other companies, such as PayNearMe Inc., came to the market to target businesses that rely on cash – usually overlapping with those that depend on checks. PayNearMe Express allows consumers to make cash payments electronically.
Both Zipmark and PayNearMe sell to real estate property managers and utility companies, which are both highly reliant on cash and paper checks.
Zipmark addresses the 45,000 rural utility companies that have outdated online billing systems or don't accept payments online at all, says Bhattacharya. Zipmark launched to the public in January, and although Bhattacharya wouldn't reveal the number of users on the platform, he says Zipmark is processing millions of dollars a month.
Alternative payment company Dwolla has also seen use of its network with businesses, such as the food and agriculture industry, that rely on checks. Dwolla charges 25 cents per transaction over $10 and launched MassPay for batched e-payments in October.