In This Chapter
Using the QuickBooks online payment services
Using the QuickBooks online banking service
Reviewing other online services
In this chapter, I start by discussing the QuickBooks online banking and bill payment features, which are pretty cool tools for some businesses. At the end of the chapter, I also briefly discuss some of the other online services that Intuit provides for QuickBooks users.
Before I discuss using the QuickBooks online banking and payment services, you need to consider whether these features even make sense for you and your business. Online banking does make sense for some people — maybe even you. But then again, it might be more like the fins on a '62 Cadillac: cool, but not that cool.
For QuickBooks, online banking includes two parts: online banking itself and online bill payment. Basically, online banking enables you to transmit account transfer instructions to your bank and download (retrieve) account information electronically by using your computer and the Internet. Online bill payment allows you to transmit payment instructions electronically. (You basically tell your bank to write, stamp, and mail a check so that you don't have to.)
And that, my friend, is about all there is to online banking.
I don't know whether you should bank online, really, but I'll share some thoughts with you. And no kidding, I've had my reservations over the years about this feature. Is it safe? Is it easy? Is it just another way for a software company and my bank to make more money off of me?
Here's my latest thinking on the matter: You ought to use online banking. It is safe if you don't share your personal identification number (PIN), and it saves you tons of time. In fact, online banking should allow many business owners to do their books themselves for just a few minutes of work at the end of the week.
That being said, I should quickly point out the few flies in the ointment, so to speak:
Your bank needs to use the Intuit service. To use the full-blown online banking service, you need to use a bank that has signed up for this Intuit service. Many, many big banks have signed up. More banks sign up all the time, of course, but some haven't yet. So if your bank hasn't jumped on the bandwagon — that is, the Intuit bandwagon — you can't really jump on the bandwagon either. Or at least not as a full-fledged member of the band.
Tip
To find out whether your bank provides online banking, choose Banking
It isn't totally paperless. Although a totally electronic system sounds really efficient and very slick, you need to realize that online bill payment (a key component of online banking) often isn't that efficient or slick because, to be quite honest, the system isn't totally electronic.
"What the . . . ?" you're saying. "I thought that was the point." Let me explain: For better or worse, most businesses are still set up to — and still expect to — receive paper checks with remittance advices. What often happens when you transmit payment instructions is that the bank or online payment service simply prints a check for you. Think about that for a minute. If the bank is printing your check, you still have all the disadvantages of a printed check, including the following:
You still need to allow extra time for mailing.
You still have the possibility that the check will get lost.
You still have the possibility that the check will be misapplied. In other words, the check to pay your power bill might instead be applied to your neighbor's account.
There's a greater chance for error. What's more, you have the extra complication of having your bank, rather than you, mucking up all this stuff.
It ain't free. Best of all, the bank most likely charges for this service. And so does Intuit. (Remember that banks and software companies think that online banking is an exciting new way for them to make money.)
You might run into possible vendor confusion. Receiving payments from your bank, as opposed to directly from you, might confuse your vendors. The confusion occurs because the checks that they receive come all bundled up in these cute little envelopes that must be torn along the perforation on just about all sides. And because you can't send a remittance slip with an online payment, vendors can easily credit your account incorrectly, which can lead to problems. (My power company regularly threatens to turn off the gas to my office because even though my electric and gas charges are included on the same bill, the power company doesn't like me to send one check via the QuickBooks online bill payment system. It needs two checks: one for the electric bill and one for the gas bill.)
Warning
One other problem bears mentioning. When you use online banking, you create a complex system without clear responsibilities for problem-solving and technical support. And that means that when you have problems, you often can't call someone to get help. (No kidding. Just the other day, some poor guy e-mailed me because his online banking stuff wasn't working: Intuit blamed the bank, the bank blamed his PC hardware, the PC company blamed Intuit. . . . This guy has a problem that nobody can solve or will solve.) This is important to understand, so let me briefly outline the steps that an online payment might take:
Tip
You enter the transaction in QuickBooks.
You make, or QuickBooks makes, an Internet connection.
QuickBooks uses the Internet connection to send the transaction to the bank.
The bank receives the transaction information and typically creates a check, which it mails to the person you're paying.
The person you're paying gets the check, hopefully, and credits your account.
Five simple steps, right? Wrong. Any of these five steps can go wrong — and if one does, you don't actually make the payment or transfer, and you won't know why:
Bugs happen. If QuickBooks or your computer has a bug, it might say that you entered and transmitted a transaction when in fact you haven't. This has happened to me.
Ya gotta get online. If your Internet connection doesn't work or doesn't work dependably, you can't send the online transaction. I've had problems both with online banking at home over a dialup Internet connection (bad telephone cord) and at work when using a network and a DSL connection (either an incorrectly configured network or a bad DSL).
Banks are fallible. If the bank screws up printing or mailing the check, well, of course your check won't get there. (I've had this happen, too — no kidding. QuickBooks lets you enter a five-line address on a check, but the check printed by the bank or online payment service can have only four lines. So QuickBooks just removes the fifth line of the address block.)
I don't mean to rant here, but whenever any of these problems occurs, you won't actually know what's gone wrong — only that something has gone wrong. And you'll be responsible for solving the problem even though it might be the fault of your bank, Intuit, your Internet service provider, the telephone company, or somebody else.
So what should you do? Let me make a suggestion: If you use a bank that provides online banking, go ahead and try the service. Absolutely! It isn't very expensive — probably a few dollars per month. If you decide later on that you don't like the service, you can always go back to banking the old-fashioned way.
Tip
If you use a bank that doesn't provide online banking services and you're really bummed out about it, you can try the online bill payment component of online banking by using the Intuit online bill payment service. Online bill payment is the part where you send instructions either to your bank (if it provides the service) or to Intuit to write and mail checks for you. You can use the online bill payment service with any account — in essence, you just give Intuit permission to automatically deduct money from your account to make payments for you.
If you use a bank that doesn't provide online banking and you couldn't care less, don't try the online banking stuff, don't read any more of this chapter, and consider taking the rest of the afternoon off.
All you need to do to sign up for online banking service is to choose Banking
Note
To actually begin transmitting online payments or making account inquiries, you need to complete the application and have that application processed. Note, too, that you can also usually complete the application by filling out paperwork from your bank and turning that in. You might not have to use the online application process.
Plan to create and send online payments a good week before they're due. Processing your request and then printing and sending a check takes time for the online bill payment service. And a check that your bank sends doesn't go through the mail any faster than a check you send yourself. So don't expect online bill payment to save you any time over sending checks that you print or hand-write yourself.
After you sign up for online banking, making payments is easy. Just follow these steps:
Choose Banking
You can also click the Write Checks icon on the Home screen. If you've written checks with QuickBooks before, you probably recognize your old familiar friend, the Write Checks window, as shown in Figure 13-1.
Click the Bank Account drop-down list at the top of the window and then choose the account from which you want to write this check.
Note
Choosing the account is a really important step. Make sure that you're accessing the correct account before you write a check.
Select the Online Payment check box.
Selecting this check box is another important step. If you don't select this check box, you aren't making an online payment; rather, you're just writing a regular check that you need to print or hand-write.
Fill in the check.
If the payee appears on one of your name lists, the AutoFill feature fills in the name of the payee in the Pay to the Order Of line after you type a few letters. For online bill payment, you must have the correct address. If the address is incomplete, QuickBooks warns you and asks you to correct it. If you haven't entered a transaction for this person or party before or added them to a list, QuickBooks asks you to Quick Add or Set Up the payee name. Do that.
Tip
By the way, QuickBooks makes you collect more information about anyone you're going to pay with an online payment.
Enter the amount of the check next to the dollar sign and then press Tab. QuickBooks writes out the amount for you on the Dollars line.
Fill in the Expenses and Items tabs, if necessary.
Don't know what these tabs are? Chapter 6 explains them in minute detail. Start turning those pages.
Click the Save & New button or the Save & Close button to finish writing the check.
Click Save & New to write another check, or click Save & Close if you're finished writing checks for the moment. There you have it. Your check is written, entered in the Checking register, and ready to be sent so that your bank or Intuit can print and mail it.
And you thought this stuff was going to be tough, didn't you?
People who have grown accustomed to Quicken, a cousin product of QuickBooks, may want to use the Register window to make online payments. You can use the Register window in QuickBooks, too, although doing so isn't quite as slick. You just enter the payment in the usual way, except that you type the word SEND in the Check Number text box.
You can electronically transfer money between bank accounts, too, as long as the accounts are at the same bank. (Both accounts, of course, also need to be set for online banking.) Here's what you need to do:
Choose Banking
You see the Transfer Funds between Accounts window.
From the Transfer Funds From drop-down list, choose the bank account that you're going to transfer the money from.
From the Transfer Funds To drop-down list, choose the bank account to which you want to transfer the money.
Select the account that you want to receive the funds.
Select the Online Funds Transfer check box.
Doing so tells QuickBooks that you want to make this transfer electronically. (This box doesn't appear if you're not set up for online banking.)
Enter the amount that you want to transfer in the Transfer Amount field and then fill in the Memo text box.
Someday, you might go into the register for the account that you're transferring money from and wonder where you transferred this money and why. Filling in the Memo line solves this little mystery beforehand.
Click Save & Close.
The transfer is recorded. After you transmit the transfer instructions (which I describe a little later in this chapter), the transfer transaction is posted to your account — maybe not immediately, but as fast as a telephone transfer or an ATM transfer is posted.
QuickBooks doesn't actually send, or transmit, your payment and transfer instructions until you tell it to. This little fact means that you can change or edit your payment instructions (what you enter with the Write Checks window) and your transfer instructions (what you enter with the Transfer Funds between Accounts window) until you actually transmit them. You edit online payments and account transfers in the same way that you edit regular payments and account transfers. Read Chapter 8 if you need more information.
After you describe the online payments and account transfers that you want QuickBooks to make, you transmit that information to the bank. To do so, follow these steps:
Choose Banking
You see the Online Banking Center window, as shown in Figure 13-2.
From the Financial Institution drop-down list at the top of the screen, choose the bank to which you're transmitting payment and transfer instructions.
Review the payment and transfer instructions one last time.
Take one last peek at the Items to Send list to make sure that any payment and transfer instructions that you're sending are correct. If you have questions about a particular instruction, click it and then click the Edit button. If you know that a particular payment instruction is incorrect, click it and then click the Delete button.
Click the Send/Receive Transactions button to transmit the payment and transfer instructions.
QuickBooks prompts you to provide a PIN (a personal identification number) with a cute little dialog box. If you're transmitting payment and transfer instructions for the first time, QuickBooks probably prompts you to change your PIN.
Review any transactions that the bank tells you about.
After QuickBooks makes the connection and sends and receives transactions, QuickBooks updates the information shown in the Online Banking Center window. You can get more information about many of the items listed by clicking. You can add transactions that Quickbooks downloads from the bank but which are not yet in your bank account registers by clicking the Add Transactions to QuickBooks button (which appears at the bottom of the window.)
Click the Close box.
Hey, when you're done, you're done.
Doing all your banking electronically can be a little unsettling when you're starting out. What if, for example, you have a question? All you do is send an e-mail to the bank, asking the people there whatever question you would normally ask in a telephone call or at the drive-through window. To do so, follow these steps:
Click the Create Messages hyperlink, which appears roughly in the middle of the Online Banking Center window.
QuickBooks displays the Create Message (see Figure 13-3) and fills in the bank name (as long as you use online banking services with only one bank). If you use online banking services with more than one bank, choose the name of the bank to which you want to send a message from the Message To drop-down list.
Click the Subject box and then type a brief description of your message's subject.
I may be telling you something you already know, but most e-mail programs simply display a list of messages that includes the sender, the message subject, and the date. Therefore, the message subject that you use is one of the first bits of message information that the bank folks see.
Select the online account that you're going to discuss in the message.
Click in the Message text box and then type your message.
You're on your own here.
(Optional) Click the Print button to print a copy of your message.
Click OK.
When you click OK, you add the message to the list of stuff that's ready to send the next time you go online with your bank. You can send the instructions immediately by following the steps in the "Transmitting instructions" section, earlier in this chapter.
Intuit provides several other small business–type services to QuickBooks users. For example, Intuit has also arranged for a merchant credit card service, which you can apply for online and then use online for receiving payments and even getting charge authorizations. Through its Web site, Intuit also says it provides a small business purchasing service that makes price shopping over the Internet easy, or at least easier. And finally, as I hint in Chapter 11, some of QuickBooks payroll services are very online-ish.
If you have questions about the current state of any of these products or services, visit the QuickBooks.com Web site and search for the name of the service.