As more consumers choose to shop without cash, merchants have to use whatever payment solutions that are available to them to meet their customers preferences. Credit cards and digital wallets are great ways for customers to pay, but also there are many advantages to electronic check processing. In addition to cost savings, accepting electronic checks is safe, secure, and convenient.
Understanding Electronic Check Processing
Before the advantages, you need to understand how electronic check processing works. eChecks, which are a type of direct deposit, that uses the Automated Clearing House (ACH), which is the electronic network that U.S. financial institutions use to process credit and debit transactions. ACH moves funds from one bank account to another via batch processing. Though they are processed just like paper checks, eChecks are faster. Also, electronic check processing is the most secure, cost-efficient way for a customer to pay an entity or to make a payment for good and services because the funds are transferred directly from a bank account.
More Money in Your Pocket
Businesses that accept eChecks often save money, especially if you are a merchant that has lower monthly sales volumes. Credit card interchange fees are much higher than the smaller flat fees that often are charged to process electronic checks. Also, unlike credit card processing, there are no transaction amount limits to process eChecks.
Even More Savings
Electronic check processing also is a great option and money-saver for merchants that accept large payments, like mortgage payments, or use recurring billing, such gym memberships. Subscription-based businesses, which offer auto-renewals, automatic payments, or recurring billing, that accept eChecks benefit because they are more likely to always have money continue to come in. Electronic check payments come from a purchaser’s checking account. Unlike credit cards, which change whenever a card expires or for other reasons, check account numbers rarely change. There is less risk that a merchant will lose a customer when they pay with electronic checks.
Fewer Security Risks
Every merchant needs to do whatever they can to efficiently and effectively accept payments from customers. Patrons depend on merchants to keep their sensitive, personal information protected.
Since electronic check processing uses state-of the art technology and more security measures, eChecks are safer than paper checks. Electronic checks can’t get lost in the mail and they are less likely to be stolen. They don’t need to be passed through many sets of hands before it is processed.
They also are safe because electronic check processing uses the banking industry’s paper check payments system. The system is based on a solid legal infrastructure, as well as long-established business practices.
More Convenient
Since everything is electronic, merchants don’t have to physically take checks to banks and take the time to fill out deposit slips. Electronic check processing also is great for businesses that work from multiple locations. Checks can be converted at one of your locations and then, all funds can be deposited into one primary bank account.
Also, when you electronic checks are used, the funds clear quicker. Often, funds are verified within 48 hours from when the transaction was initiated. As long as the funds are available in the purchaser’s bank account, the transaction clears in three to five business days. Then, the funds are moved from the payer’s account to the merchant’s account. These are average time period. The exact period of time does vary depending on the financial institution. Paper checks and credit card payments taking longer to clear. eCheck payments can be seen almost immediately because the payments are transferred directly from bank accounts.
The Final Word
Electronic check processing is a great alternative or addition to credit card processing. It’s faster, more convenient, and more efficient than paper checks and its cheaper than processing credit card payments. With all of the benefits, it is a payment solution that any business should consider.
When it’s time to learn more about electronic check processing services, turn to a merchant account service provider that has experience to thoroughly discuss this payment solution. To begin accepting electronic checks, businesses to need to set up merchant accounts. Applying for a merchant account is simple and fast.
To find out more about electronic check processing services, contact eMerchantBroker.com (EMB). We are a trusted, reliable payment solutions provider that specializes in offering payment solutions to all type of merchants, including high-risk businesses.