What Is a Remotely Created Payment Order (RCPO) – Explained for U.S. Businesses!
Running a business in the U.S. today requires fast, secure, and flexible payment options. From eChecks to ACH transfers, credit card payments, and mobile checkouts—business owners want solutions that reduce friction and speed up cash flow. One payment option that often gets overlooked, yet remains extremely useful, is something called a Remotely Created Payment Order (RCPO).
If you’ve heard the term before but are still unsure what it really means, how it works, or why a business would use it—this guide breaks everything down in simple, practical language. By the end, you’ll understand exactly what an RCPO is, where it fits in today’s payment ecosystem, and whether it might benefit your business operations.
What Exactly Is a Remotely Created Payment Order?
A Remotely Created Payment Order (RCPO) is a type of check-based payment that a business creates on behalf of a customer without needing the customer’s physical signature. Instead of signing a paper check, the customer authorizes the transaction verbally (over the phone), online, or through written permission.
Think of an RCPO as a digital or phone-approved check that a business generates remotely.
It looks like a traditional check, contains the customer’s bank information, and moves through the banking system like any other check—but the key difference is:
👉 The customer does not physically sign the check.
👉 The business creates the payment order using the customer’s authorization.
This system helps businesses collect payments quickly—even when customers are not physically present.
Why Does an RCPO Exist?
Before the internet and smartphones became widely used, businesses needed a way to accept payments from customers who weren’t standing in front of them. Checks by mail were slow. Wire transfers were expensive. Card payments were not always widely used.
RCPOs solved that problem by allowing businesses to:
- Take a payment over the phone
- Create a check on behalf of the customer
- Deposit it directly into their bank
This offered a faster alternative to mailing a physical check—and it still does today.
Even though ACH and card payments are more common now, RCPOs remain valuable for specific industries and use cases.
How Does a Remotely Created Payment Order Work?
Here’s a simple walkthrough:
Step 1: Customer Authorizes the Payment
Authorization can be given by:
- Phone call
- Online form
- Signed agreement
The business must clearly communicate:
- The payment amount
- The date
- The purpose
- The customer’s approval
Step 2: The Business Creates the Remotely Created Payment Order
The payment order includes:
- Customer’s bank routing and account number
- Payee (business receiving the funds)
- Payment amount
- Date
- A statement indicating that the item is “authorized by the customer”
Step 3: The Business Deposits the Remotely Created Payment Order
The RCPO is deposited electronically through:
- A payment processor
- A virtual terminal
- A bank system
Step 4: Customer’s Bank Processes the Payment
- Funds are transferred just like a regular check, usually within 2–5 business days.
Remotely Created Payment Order vs. ACH vs. eCheck — What’s the Difference?
| Feature | RCPO | ACH Payment | eCheck |
| Payment Type | Check-based | Electronic bank transfer | Digital version of a traditional check |
| Who Creates It? | Merchant creates the payment order | Customer authorizes the transfer | Customer submits bank details; system generates the digital check |
| Signature Needed | No physical signature | No physical signature; authorization required | No physical signature; digital authorization |
| Authorization Method | Remote customer authorization | Written, digital, or recorded authorization | Customer enters bank information online |
| Processing Network | Processes through check-clearing system | Uses ACH network | Uses ACH network |
| Speed | Slower than ACH | Faster and automated | Fast and widely used |
| Common Use Cases | Phone payments, high-risk industries, no card processing | Subscriptions, payroll, online debits | Online billing, recurring payments |
| Security Level | Higher fraud risk if not verified | Highly secure under ACH rules | Secure and regulated under ACH |
| Key Advantage | Allows merchants to create payment orders | Fast, automated, widely accepted | Easy online payments without a physical check |
| Key Drawback | Requires strong fraud controls | Requires ACH authorization setup | Still subject to ACH return rules |
Why U.S. Businesses Still Use RCPOs Today: —
Even with modern payment options, RCPOs still offer unique benefits.
1. Ideal for Phone-Based Sales: If your sales team closes deals by phone, RCPOs allow you to take payments immediately without sending links or waiting for ACH forms.
2. Useful for Businesses Serving Non-Tech-Savvy Customers: Industries with older customers often prefer phone authorizations.
3. Works Well for Recurring or High-Ticket Payments: RCPOs make it easier for:
- Professional services
- Medical offices
- Agencies
- Contractors
- Membership-based businesses to collect large or frequent payments.
4. Faster Than Mailing Checks: RCPOs eliminate shipping delays—money moves quicker, cash flow improves.
5. Can Reduce Card Processing Fees: Since RCPOs run through the banking system (not card networks), businesses often save money on transaction costs.
What Are the Risks of RCPOs?
Because RCPOs do not have a physical signature, banks treat them with extra caution.
1. Higher Dispute Rates: Customers may dispute a transaction if they forget or misinterpret the authorization.
2. Compliance Requirements: Businesses must maintain strong authorization records, including:
- Recorded phone authorizations
- Written confirmations
- Email approvals
- Digital audit trails
3. Processing Rules: Businesses must follow federal and banking regulations for RCPOs, mainly:
Key Takeaway:
RCPOs are powerful—but only if used responsibly with proper documentation and clear communication.
Best Practices for U.S. Businesses Using RCPOs: —
If you plan to use RCPOs, here are proven ways to protect your business and customers.
1. Always Obtain Clear, Verifiable Authorization:
- Phone recordings, emails, or signed agreements help prevent disputes.
2. Disclose All Payment Details Upfront:
Explain the:
- Amount
- Date
- Purpose
- Recurring nature (if applicable)
3. Use a Trusted Payment Processor:
Instead of creating RCPOs manually, most businesses rely on secure payment platforms that:
- Collect and store authorization
- Automate check drafting
- Ensure compliance
4. Maintain Records for a Minimum Required Period:
- Store authorizations securely in case the customer’s bank requests proof.
5. Keep Customers Informed:
Send:
- A confirmation email
- A receipt
- A breakdown of charges
Which U.S. Industries Commonly Use RCPOs?
Remotely Created Payment Orders are especially useful in industries where customers often pay remotely or through phone authorization.
Industries That Benefit Most:
- Professional service providers
- Digital marketing agencies
- Subscription and membership services
- Medical and wellness providers
- Home improvement and contractors
- Real estate services
- Business consulting firms
- Debt resolution services
- Insurance agents
These businesses appreciate RCPOs because they can close deals quickly, even with customers who aren’t comfortable with online payment portals.
Is an RCPO Right for Your Business?
Here’s a simple way to decide:
RCPOs may be a good fit if your business:
- Takes payments over the phone
- Handles high-ticket invoices
- Works with customers who prefer check-based payments
- Wants an alternative to ACH or credit cards
- Needs faster check processing without mailing delays
RCPOs may not be the best fit if your business:
- Mainly accepts card or online payments
- Have customers been comfortable with ACH authorization forms
- Needs instant payment confirmation (like debit card authorizations)
For many U.S. businesses, RCPOs work best as one payment option among many, giving customers and clients more flexibility.
Conclusion: —
A Remotely Created Payment Order (RCPO) is a practical payment tool that gives U.S. businesses the flexibility to collect payments remotely—without relying on physical checks or complex digital systems. When used correctly, RCPOs can speed up cash flow, reduce payment friction, and provide customers with a familiar payment experience.
Whether you’re a service-based business, contractor, consultant, or membership provider, RCPOs offer a reliable option for taking payments over the phone or online in a secure and compliant way.
