Credit policies
Explore tiered credit policies for payroll processing and risk assessment strategies at Check.
Definitions
Accelerated processing | Payrolls where the approval deadline day is two business days prior to payday or less |
Standard processing | Payrolls where the approval deadline day is three business days prior to payday or more |
Failed funding | Occurs when Check processes an ACH debit from an employer bank account to fund payroll and the ACH debit returns (i.e., fails) |
Non-sufficient funds (NSF) | A failed funding that returns with an ACH return code "R01" (non-sufficient funds), indicating the bank account did not have sufficient funds to fulfill the debit |
Failed funding strike | Each payroll with one or more failed funding counts as a single "strike" towards termination (multiple failed fundings related to a single payroll only count as a single strike)
Failed funding strikes can occur on accelerated- or standard-processing payrolls |
Waiting period | Employers on a waiting period must successfully fund 10 payrolls on standard processing and wait 90 calendar days
Employers on a waiting period cannot approve accelerated processing payrolls
Payrolls are counted regardless of type (e.g. off cycle)
Waiting period details are visible in Console, if you hover of the company’s processing period |
Inception company | A company with no prior payroll history |
Switcher company | A company with payroll history |
Risk assessment | Check performs a risk assessment of all new employers that join the platform; this assessment considers publicly-available data about the employer’s history and determines if the employer has an acceptable risk profile to run accelerated processing payrolls |
Credit policies
Check sets credit policy in tiers at the partner level, depending on the risk profile of the partner's user base. Partners are assigned to tiers as follows:
- Low Risk Tier
- Standard Risk Tier
To confirm policy tier assignment, contact your account manager.
Note: Qualification for the Low Risk Tier is contingent on maintaining minimal or no losses. If a Low Risk Tier partner experiences fraud, significant credit losses, or other material risk events, Check may change that account’s risk tier at any time, at our sole discretion.
Policy | Standard Risk Tier | Low Risk Tier |
Risk assessment for onboarding companies | Check reviews litigation, tax-lien, and UCC-lien history | Check reviews tax-lien history only |
Failed fundings block concurrent payrolls | If a Company runs multiple, concurrent payrolls and one payroll has a failed funding, other payrolls will stop processing until the failed funding is resolved.
This means employee credits on other payrolls (even if those payrolls are successfully funded) may be delayed until the failed-funding payroll is resolved.
For more information, see link.
New payrolls cannot be approved until the failed funding is resolved. | If a Company runs multiple, concurrent payrolls and one payroll has a failed funding, other payrolls will continue processing as usual.
New payrolls still cannot be approved until the failed funding is resolved. |
Failed funding on payroll debits | First failed funding, NSF
If the employer’s first failed funding is for non-sufficient funds (NSF), they will be put on a waiting period. The first day of the waiting period is the day the ACH return is received by Check.
First failed funding, non-NSF
If a failed funding occurs for any return code other than NSF, the employer will have 5 business days to resolve the failed funding.
During this time, they can continue to approve accelerated processing payrolls. If they successfully resolve the failed funding, they can continue to approve accelerated processing payrolls.
If they fail to resolve the failed funding within 5 business days, they will be put on a waiting period. The first day of the waiting period is the day the ACH return was received by Check.
Second failed funding
After the employer’s second failed funding (of any kind), the employer will be put on standard processing permanently. | If an employer has a failed funding, that employer is given 5 business days to resolve the failed funding before they are downgraded to standard processing.
If they successfully fund within 5 business days, they can remain on accelerated processing. If they fail to fund within 5 business days, they will be put on a waiting period. |
Termination for failed fundings | If an employer incurs 6 failed funding strikes, or fails to resolve a failed funding for 90 calendar days, that Company is terminated from the platform | Same as Standard Risk Tier |
Failed fundings on non-payroll debits | In certain cases, Check needs to debit funds from employers outside of normal payroll processing.
Failed funding on non-payroll debits move the employer into bad standing but do not count toward failed funding terminations.
The Employer cannot process other payrolls until the failed funding is resolved. | In certain cases, Check needs to debit funds from employers outside of normal payroll processing.
If one of these debits fails, employers are not moved into bad standing, and the failed funding does not count as a strike towards terminations. The employer can continue processing payrolls as usual. |
Inception company waiting period | Inception companies start on standard processing
If the inception company passes Check's risk assessment, they will automatically be upgraded to accelerated processing after a waiting period
If the inception company does not pass Check's risk assessment, they will remain on standard processing permanently | Same as Standard Risk Tier |
Common ownership upgrades | If an inception company can prove common ownership with another company on Check's platform, that inception company can upgrade to accelerated processing immediately as long as the following conditions are met:
- The inception company must pass Check's risk assessment
- The inception company can submit proof (via Zendesk ticket) of common ownership with another company on Check
- The other company must have:
- Successfully funded 10 payrolls
- Been running payroll on Check for more than 90 calendar days
- Have no funding failures for non-sufficient funds
The policy also applies to companies migrating from one Check partner to another. In this case, Check will consider the company on the new Partner to be the inception company and the company on the original Partner to be the "other" company, and the company on the new Partner can upgrade to accelerated processing as long as the conditions above are met. | Same as Standard Risk Tier |
Year-start switchers | To accelerate onboarding at year start, companies with January start dates are not required to upload historical payrolls to be considered switcher company.
To get accelerated processing, the company must:
- Pass Check's risk assessment
- Have a Check start date in January
- Self-report a previous payroll provider (recorded in the previous_payroll_provider field in the Enrollment Profile) | Same as Standard Risk Tier |
Debit payment methods | Check only accepts the following payment methods for payroll debits: ACH, Wire, Instant payments (RTP, FedNow)
Other payment methods (such as paper check, e-check, online bill pay, Venmo, credit card) are not accepted. If Check receives funds via any of these methods, Check will attempt to return funds to the sending party. Check will not process payroll or return a company to good standing if funds are sent via any unsupported payment method.
Due to fraud risk, Check may retain funds for up to 60 days before returning to the sending party. | Same as Standard Risk Tier |
Credit payment methods | Check uses the following payment methods for payroll credits: ACH, Instant Payments (RTP, FedNow)
Check chooses available payments methods based on processing period, payroll timing, and the employee’s bank. Employers cannot opt out of specific payment methods. | Check will only process credits with ACH. |
Risk sharing | Check offers a risk-sharing feature for partners who want to override Check's credit decisions. This allows partners to upgrade key accounts to accelerated processing at any time, in exchange for accepting credit risk on that account.
Risk sharing works as follows:
- Authorized users can log into Check Console and designate a company for risk sharing. At that time they can also define the length of the risk sharing period (date range, number of payrolls, or unlimited)
- Afterwards, that company will be able to approve accelerated payrolls during the risk-sharing period, regardless of any Check credit decision
- If a risk-sharing company has a failed funding, Check will perform collections efforts as usual. If, despite collections efforts, the failed funding is not recovered within 60 days, Check will bill the partner for any amounts lost.
- Risk sharing is available to partners on a case by case basis and requires a contract amendment. Partners must have no overdue invoices to be eligible for risk sharing.
To manage risk sharing, users must have the "Cost Owner" user level in Console. Only "Cost Owner" users can add other "Cost Owner" users. To enable risk sharing and add the first "Cost Owner" user, contact your account manager.
Loom with additional risk-sharing information | Same as Standard Risk Tier |
Bank accounts | Check only supports bank accounts connected via Plaid or directly (using account and routing number). If connecting directly, Check only support bank accounts with numerical account numbers. Alphanumeric account numbers are not supported. | Same as Standard Risk Tier |
Policy exceptions
Check will not grant exceptions to processing period decisions or failed-funding terminations, other than in cases where technical issues in Check's system caused an incorrect decision or termination.
Check strives to develop credit policies that create the lowest-possible business impact for our partners while still maintaining a sustainable risk posture for Check. Check encourages partners to adopt our risk-sharing feature if they want more control over business and risk tradeoffs.
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Last updated on May 31, 2025