What is a Check by Phone?

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  • Written By: Lainie Petersen
  • Edited By: Melissa Wiley
  • Last Modified Date: 23 March 2019
  • Copyright Protected:
    Conjecture Corporation
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A check by phone, also known as a tele-check or demand draft, is a method of accepting a personal or business check over the phone without the necessity of the person making the payment actually writing a paper check. Many businesses that accept check by phone as payment utilize software developed by a third party for the purpose of drafting and validating check information. The business requests a customer's checking account information, which is then entered into the software system, and a check is printed. A check created through a check by phone system is then deposited to the business's bank account.

For businesses that offer telephone or online ordering, check by phone can provide a way of accepting payments from customers and clients who do not have a credit card. Other businesses and organizations that use check by phone services include collection agencies, schools, and government offices. For collection agencies and accounts receivable departments, check by phone can be an excellent way to help clients maintain payment arrangements. Companies that are concerned about the possibility of credit card charge-backs may also appreciate the greater certainty of payment that a personal check can provide. For consumers, a tele-check can provide them with hard-copy proof of having paid a debt.


Check by phone payments may involve the use of a live operator or an automated voice mail system. The customer or client will be asked for his bank name, routing number, and bank account number. The system may also request a specific check number as well. Once this information is entered into the check by phone system, a paper check is created and can be deposited like any other check, though it does not require the account holder's signature. As the account holder does not have to provide or sign the paper check, there exists a considerable risk of fraud.

Demand draft fraud occurs when a company prints and deposits a check without the authorization of the account holder. Those who own bank accounts should be aware that their banking information can be used to drain their account of its funds. Once this happens, it can take a considerable amount of time for a bank to investigate the fraud and return the funds to the account holder. While the investigation takes place, the fraud victim may not be able to pay necessary bills. To avoid this type of fraud, individuals should be wary of giving out their bank account information to those who ask, and they may want to consider using credit or debit cards instead of check by phone services.



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