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Australia is ending paper checks, should SMBs do the same?

A small business owner writing checks to pay vendors in her living room.

According to recent reports, Australia plans to gradually eliminate the use of paper checks in the country by the end of this decade. The decision is part of a government strategic plan to modernize the country’s payment infrastructure.

Australia’s treasurer Jim Chalmers said checks are a more costly way of doing business and can be replaced by web or mobile payment services. We couldn’t agree more, Jim. 

While the U.S. isn’t expected to make a similar commitment any time soon, we believe companies, especially small and medium-sized businesses (SMBs), should follow Australia’s lead.

In this article, we’ll explain why checks are obsolete and how SMBs can replace them with better and more efficient digital bill pay tools.

Who still uses paper checks, anyway?

If you’re like most people, you probably don’t write that many personal checks. You may still be using checks to pay rent, but even this use case is in steep decline

So, how come we’re still talking about checks? Because as many as 81% of U.S. businesses still use them to pay other organizations. What’s more, 40% of all B2B transactions are still done by check. 

If you’re wondering why, we’ve been asking ourselves the same question. Maybe the appeal of checks for businesses lies in their familiarity, making them feel like a safer option (only they’re not, but more on that later). It could also just be the fact that humans tend to hang on to physical objects that seem more tangible. 

Whatever the reason, it’s time to reconsider this practice.

The problem(s) with checks

If you still think paper checks are your friends, here are four reasons to think again.


A lot of people forget that checks come with additional costs for both the payors and recipients of the payment. These costs include bank processing fees, the price of the physical checkbook, postage, and staff hours spent manually writing and posting them. This easily adds up to between 4$ and $20 a pop

Even if you’re sending out just seven checks a month, this can mean additional hidden spending of up to $1,680 a year. That’s a lot of money to spend just in order to pay the bills.

Carbon footprint

The paper used to print your checks and manufacture your envelopes may be made of trees but it doesn’t grow on them. On top of its financial cost, its production is also a burden on the environment. 

Mailing the check or using a courier means burning gas to physically transport it from place to place, thus further increasing the damage.


When you send out a check it takes a long time before it arrives and gets processed. It can be days or weeks, you never really know. 

The issue here is that a lot of things can happen during this unpredictable time frame. If you’re not careful and paying very close attention to your bank situation, your check might bounce or drain your account at the wrong time, depleting your cash flow.


Did you know that all an attacker needs to perform ACH payment fraud is your bank account number and routing number? And, what’s printed right on every one of your checks? You guessed it—this exact information.

So, why are you handing it out so easily or worse, letting it roam unattended across the country in an envelope?

The disappearing act

Physical objects have a weird tendency to go poof. Whether they’re lost or stolen, it’s never good news when it comes to financial instruments like checks. 

While missing checks can be replaced, it can be a hassle and comes at an additional cost. The delays it creates can also result in late penalties, damaged relationships with vendors, and in some cases, even litigation.

What’s the alternative?

Switching to digital payments, of course! Using an online payment platform like Melio to manage your accounts payable (AP),Accounts payable (AP)Accounts payable is an accounting term that refers to the outstanding bills or invoices for goods and services already provided to your business but that you haven’t yet paid for. you can:  

  • Schedule payments in advance
  • Send ACH bank transfers at no additional cost
  • Use a credit card to preserve your cash flow without affecting how your vendor gets paid*
  • Pay international vendors
  • Send business payments on the go through the mobile app
  • Track all your business payments from one place

What if my vendor won’t hear of it?

If your vendor isn’t quite sold on digital payment methods and insists on getting a check, that doesn’t mean you need to go back in time and write one. You can use Melio just the same and choose the payment method that works for you. We’ll take care of printing and mailing out the check on your behalf. 

On top of time and hassle, this will also save you money. The first two checks you send via Melio each month are free. And, if you need more checks, you’ll pay a flat $1.5 fee for the whole process, regardless of the payment’s sum. You can even combine several bills from the same vendor and pay with a single check to save even more on fees.

Never write another check again

Instead of wishing you lived in Australia, the next time a vendor asks you for a check, have Melio write it for you. We’ll even put it in an envelope with a stamp and everything so you don’t have to worry about it.  

Sign up for free today to shift to digital payments and leave paper checks behind. We promise you won’t miss them.

*This blog post is intended for informational purposes only and is not intended as financial advice.
**Melio does not provide legal, tax or accounting advice, and you should consult with a professional advisor before making any financial decisions.