Do You Know the Major Differences Between TeleCheck and ChexSystems?
Do you have a checking account at your local bank? If you do, you may have heard about the systems many banks use; systems that you don’t want your account to wind up being a part of. These systems are TeleCheck and ChexSystems. They are used to track information for people who have made mistakes with their checking accounts. It is wise to get a better understanding of how they work. Read on to find out more about these systems of reporting that the majority of banks use.
TeleCheck keeps a running record of certain types of checking account abuse. This abuse is something that the account owner might be responsible for, like writing bad checks or other major checking account mistakes. ChexSystems is a database that banks use to see if potential account holders are too much of a risk. This database holds information about account abuse/mismanagement on previous bank accounts, and gives the banks plenty of details. This system helps banks to effectively “weed out” any consumers that they do not want to give accounts to.
What Causes People to get reported to TeleCheck or ChexSystems?
There are a few reasons that you might get reported to ChexSystems. Here are some reasons you need to be aware of:
- Not paying overdraft fees.
- Mishandling debit cards and ATMs
- Writing a check with insufficient funds to cover it.
- Opening a bank account with incorrect information.
- Misuse/Abuse of Savings account privileges
The last entry about savings accounts is important to keep in mind. It is not just checking account activity that can get you into trouble, so keep that in mind with regard to how you handle opening and using a savings account.
As you can see, there are a myriad of situations that could lead to your account getting listed in ChexSystems. TeleCheck is a bit easier to understand. People only get tracked by this system if they write bad checks. If you write a check and don’t have the funds in your account to cover the funds, then you could get reported to TeleCheck. These kinds of offenses are considered abuse of checking privileges.
How long does someone’s Information Stay in these Systems?
If your information shows up in TeleCheck or ChexSystems, you may have a challenging time opening up a new bank account for some time. So, just how long will it take for your information to get out of these databases once you’ve been reported? On average, you’ll find that accounts stay in these tracking systems for about five years. After the five years is up, the company that reported you can have your information removed, or you can contact ChexSystems and/or TeleCheck to have them remove it for you.
Until your information is removed from these systems, there are parties that have access to these databases that you should know about, including:
- Individuals/Businesses that have written consent to do so.
- Employers that have written consent.
- Anyone or any organization that the court orders is allowed to access this information.
- Government officials following up on any license application that requires financial proof.
- Certain individuals that are tracking information related to child support cases.
It seems that no matter which way we turn, there are organizations and individuals tracking nearly everything that we do. Now that you understand how TeleCheck and ChexSystems work, it is in your best interest to avoid getting listed in these databases. To do so, avoid writing bad checks at all costs and do all that you can to make responsible use of your bank accounts.