There has been a dip in paper check payments in the U.S. in recent years. The drop made up 7.2% yearly from 2015 to 2018, according to the Federal Reserve. That’s where eChecks step in. This article will help you with e-checking and who you can apply to for eCheck payments.
eChecking: Processing Electronic Check Payments
An electronic check or eCheck is an electronic version of a paper check. It’s also called an online check, Internet check, and direct debit. eChecks are associated with the Automated Clearing House (ACH).
Namely, ACH sends direct debit from a customer’s checking account into a merchant’s business bank account, thanks to a payment processor. The majority of U.S. financial institutions use the ACH network.
According to National Automated Clearing House Association (NACHA), Q3 of 2020 registered 6.8 billion ACH payments. This means a 9% increase from Q3 of 2019.
How does an eCheck payment being processed?
- Merchant requests authorization from customers.
- Sets up the payment details.
- Submits the payment data.
- Finally, funds get deposited. The payment gets automatically withdrawn from the customer’s bank account. Then, the customer receives a payment receipt sent by the online software, and the business bank account receives the payment.
eChecks for Your Business
Let’s start with a parallel between eCheck payments and credit cards. So, the most significant difference is that an eCheck uses ACH to transfer funds, which results in lower processing fees.
To accept eCheck payments, one doesn’t have to pay any credit card interchange fees. Fees can be 10 cents per transaction. And this can be quite important for a business that accepts large or recurring payments.
You can use e-checking to take payments from your customers and sell subscriptions to clients. eChecks comes with all the advantages you can find with traditional checks, only it’s electronic. Some of the perks include speedier transactions, a higher level of convenience, cost-effectiveness, and a higher level of security.
It’s worth mentioning that the direct deposit system that many employers offer is one of the more frequently used versions of online checks. Moreover, after the payment has already been processed, there is no option to cancel it. However, if the payment hasn’t been processed yet, it’s possible to contact one’s financial institution.
No matter whether you’re interested in eChecks or any other payment processing services, it’s critical to work with a respected professional in the payments industry.
With a true payment expert, you can enjoy cutting-edge merchant processing solutions and the cheapest possible rates in the space. Make sure the payments specialist can help you process global payments across one single platform and provides an exceptional payment gateway for your online transactions.
Online Checks for Your Business
An electronic check is a payment type completed via the Internet or another data network. An eCheck performs the same function as a paper check. These payments use the ACH, so they come with lower fees. To get the right payment processing solutions for your eCommerce business, you need to turn to a reliable payments expert.
Author Bio: Content crafter Alex Wilmont has been active in the payments industry for over 15 years. He lives simply, gives generously, and loves his 2 dogs. His mission is to enhance and innovate the fintech industry for years to come.