Look, Ma, No Cheques
Sydney Morning Herald
Saturday June 6, 1998
Paying employees via your PC is easy and safe.
IT TOOK me ages to get around to online banking. I find anything to do with banks boring and intrusive at the best of times. This, coupled with a reluctance to mess around with my computer for hours, meant that the project got put off month after month.
However, when I got around to it, I regretted that it took me so long. Online banking is easy, quick and if you choose the right bank, saves on fees. This week, I'll demonstrate how to go about paying your employees using online banking. I've taken the Commonwealth Bank's product, QuickLine, as an example, but if you bank with the others, the process is similar.
GETTING STARTED
Naturally, you'll need a PC and a modem, but you'll also need software from your bank that allows your computer to talk to the bank via its communications gateway.
Once the bank approves your application, you'll receive security codes and passwords. Security tactics vary, but the Commonwealth Bank, for example, provides a transport key, an encryption key, a Gateway ID and a Gateway password. You'll also get your password to open the software application, plus additional passwords if desired.
YOUR FIRST PAY RUN
If your business doesn't have a payroll software and you process wages using a hand-written book, you'll need to start by entering employee account and pay details.
In QuickLine, this involves opening the software, entering your password and going to Payee Details in the Maintenance menu.
Enter account names and numbers for each employee, and as the Statement Reference, enter what you would like to appear in your bank statement against this payment - the employee's initials will do fine. See Fig 1 for how this may look.
Once done, record your employee's wage. Click Payroll Transfer and enter as the Release Date the date that you want these payments to go through. Click Account Name first, select the employee from the drop-down list and enter the amount of his or her pay.
You can transfer money to any bank that your employee nominates, even if he or she doesn't use your bank. Fig 2 shows a payment batch for three employees.
Once your batch is complete, click Send. QuickLine will now send your pay details down the phone line to the bank's communications gateway. When processing is completed, you'll get a message saying, "Payments successfully sent to the Bank".
Did the information disappear into the ether with nothing to show for it? Reassure yourself by going to the Maintenance menu and viewing the Audit Log report.
Alternatively, allow 24 hours for the payment to clear, log on to QuickLine again, and download a statement for proof of the dollars leaving your account.
WORKING WITH PAYROLL SOFTWARE
If you have payroll software, the process is even easier. Process your payroll as normal, but this time request that the software creates an electronic payment file ready to send to your bank.
The file will typically have "aba" as the last three letters of its name, so it should be called something like "pay0328.aba".
If possible, save this file in its own folder (call it something like "PAYS") and include the date as part of its name.
Open QuickLine and click Payroll Transfer. Go to the File menu and select Open. Find your electronic payment file and double-click to select it. QuickLine will automatically enter all payroll transfer details. Click Send to complete and it's done!
WHERE TO GO FROM HERE
Once you're processing the payroll confidently, try exploring other features in most online banking products. You can transfer money between bank accounts, pay suppliers, check account balances or download statements.
After a while you'll be hooked.
It's great having banking facilities available 24 hours a day, 365 days a year, and it's a secure feeling having detailed information on tap whenever you need it.
TAKING IT FURTHER
There's a distinct lack of standardisation out there, with banks being hung up on doing their own thing. This can be a pain, especially if you've got accounts with more than one bank. For example, if you bank with the ANZ, you'll need to buy special ANZ banking software; similarly if you bank with Westpac, you'll need the special Westpac software. If you have accounts with different banks, you'll need special online banking software for each.
Some banks even restrict what accounts you can access. National Online Business excludes home loans, personal loans, credit cards and term deposits from its services; QuickLine excludes home loans and passbook accounts. On the other hand, St George allows access to all account types, and you can even open new term deposits online.
If you're comparing fees between banks, be aware of the fine print.
Some banks charge online transaction fees as well as ordinary transaction fees for every online transaction.
Others charge additional fees for every transaction you make, whether it's a cheque, EFTPOS or over-the-counter deposit, as they consider every line on your downloaded bank statements to be an online transaction.
On the upside, if you process payments in batches, rather than one at a time, you can make significant savings on debits tax.
BOTTOM LINE
Stay tuned for her advice on using programs to your best advantage at tax time. Next week: Alex Hartman's tips for business success. Technology terms on these pages will be posted on Icon's Web site at www.smh.com.au/icon/
Here's a summary of who offers what:
Name of Product Set Up Monthly Fees Transaction Fees Web site
ANZ ANZ OnLine $350 $30 10c to 30c (up to 200 transactions)
www.anz.com
Commonwealth QuickLine $79 None $5 per 40 transactions
www.combank.com.au
NAB Online Business $75 None 15c per credit (plus ordinary bank fees)
www.national.com.au
St George Internet Banking Free Free 10c per transaction
www.stgeorge.com.au
(formerly Advance) (max $5,000 day)
St George St George Connect $150 $15 20c per file
www.stgeorge.com.au
Westpac Business DeskBank $247 $35 month 15c for transfers to
other banks www.westpac.com.au
© 1998 Sydney Morning Herald
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