Pros & Cons of Payment Cards vs. Paper Cheques: We Break it Down

For decades, paper cheques have been the traditional payment method for most businesses and organizations around the world. Cheques became the standard method of payment because they are safer than cash and they provide a physical record of the payment.

However, the payment industry is continually innovating to make the payment process more efficient by providing electronic options of disbursement. A prime example is electronic payment solutions. Over the last decade, there has been an increase in payment card usage by both individuals and companies. In fact, nearly $300 billion is expected to be loaded onto open-loop payment cards in 2016, according to a study conducted by the Mercator Advisory Group.

Payment cards can be used for a number of payment requirements: payroll, employee expenses, sales commissions, bonuses, and other employee incentives.

As a decision maker at your company, you want to choose an efficient and cost-effective payment method that benefits the company and your employees alike. In this post, we’ll explore the pros and cons of payment cards vs paycheques:


  • Great budgeting tool
  • Cards are reloadable
  • Customizable to company branding
  • No need to have a bank account
  • No overdraft fees
  • Accepted anywhere VISA® or MasterCard® is accepted
  • Ability to make in-store and online purchases
  • Card is secure and includes zero liability protection from payment network
  • No credit required
  • Payments can be tracked via online platform
  • Card fees
  • Difficult to build credit history


    • Paper cheques are generally trusted because they are a traditional method of payment
    • People can make post-dated cheques to be cashed at a later date if the money is not available in their accounts
  • People keep copies for their records
  • Cost: Creating a cheque costs $0.82 vs. $0.13 for electronics payments; PaySavvy determined the total cost of issuing one cheque is $17 when you take into account secondary costs
  • Takes a lot of unnecessary activity to process and distribute
  • Bank fees
  • Processing of cheques can be lengthy
  • Paper cheques are susceptible to theft, loss and damage
  • Possibility of fraud
  • Must be deposited at a bank
  • Pay cheques are inconvenient for freelance workers or people working from another state or country

You may also like...