Are eChecks Safe for Business?

Jan 08, 2019

Fraud and cyberattacks threaten anyone involved in the payments industry. Major data breaches alarm credit cardholders and leave businesses cleaning up devastating messes.

Despite these issues, customers still want a way quick way to pay that does not require cash. In addition to accepting credit card payments, offer your customers the option of paying via eChecks. But, are eChecks safe since the processing gets completed electronically similarly to credit cards? Yes, find out how.

What Is an eCheck and How Does It Work?

An eCheck is an electronic version of a paper check that gets processed effectively and efficiently through the Automated Clearing House (ACH) network. When online customers choose to pay via electronic check, they enter their checking account information and their bank’s routing number. The merchant’s payment gateway encrypts the information, including the amount of the check, and transmits it for acceptance to the Federal Reserve Bank ACH network. From there, if it is approved, the ACH network takes the funds from the customer’s account and deposits it into a business’ account.

Understanding the Role of the ACH Network

Considered the largest, safest, and most trusted payment systems, the ACH is a network that moves funds and information electronically between banks in the United States. It moves about $41 trillion in electronic transactions every year. The Federal Reserve and NACHA (the National Automated Clearing House Association) govern the ACH. The network processes direct deposits via ACH, such as those used for payroll, and direct payments via ACH. Since everything is completed electronically, users experience cost savings and faster processing times.

What are the Benefits of Processing eChecks?

The speed of the transaction is one of the greatest advantages of eCheck processing. Instead of taking a day to clear, like a paper check, the approval process is done almost instantly because it is completed electronically.

Other advantages for merchants include:

  • Increased sales: Since you are expanding your payment options for customers, you are likely to see higher sales.
  • An eco-friendly way to process payments: No paper is used, so there is no detriment to the environment.
  • Cost savings: The cost to process electronic checks is less than it is to process credit card payments. Accepting eChecks is a way to trim processing costs.

How Secure Are eChecks?

When an eCheck is processed, it is thoroughly screened. The checking account details of the customer is verified and it also gets passed through a bad check database.

The implementation of authentication, duplicate detection, and electronic encryption also helps prevent fraud and data theft. Also, since this process requires you to sign up for a payment gateway to validate payments and guarantee services, you minimize the risks of receiving fraudulent checks.

Finally, since there is no tangible piece of paper to get lost or stolen, the chances of a check being altered or another getting access to the check holder’s account information is almost nonexistent.

Most importantly, verification, fraud prevention, and risk analysis are included with all electronic check transactions no matter how they are completed. So, whether a person pays online, by phone, or makes a payment in person, the process is protected.

Ready to Start Accepting eChecks?

To begin, find a trusted electronic check processing provider that can help you get started. (EMB) is an eCheck processing provider that works with all types of businesses. Additionally, it offers personalized payment solutions, including high risk payment processing, a secure payment gateway, and chargeback mitigation tools. Apply today to begin accepting eChecks.

Let us help you get a high risk merchant account today!

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Having a merchant account allows an account holder to take advantage of merchant cash advances. When a merchant is approved for an advance, the business agrees to receive a lump sum of cash in exchange for an agreed-upon percentage of future credit card sales.

Pricing varies depending on the merchant’s industry, past credit card processing history, the type of business seeking the account, average ticket sales, and average transaction volumes.

Yes, EMB works with merchants who are building their credit, as well as those who have poor credit. EMB also approves merchants that have no credit card processing history and businesses that have lost their merchant accounts due to high chargebacks.

Several factors influence a merchant’s risk level. Though only one factor likely will not get a merchant classified as high risk, a combination of these may: business size, location, and industry, credit score, credit card processing history, a industry’s reputation for excessive chargebacks, a prior history of high chargeback ratios, and whether a merchant exclusively sells online.

Virtual terminals are stationed on a merchant’s website, making it easy for customers to make a payment or purchase online. Merchants or a payment processor can easily set up virtual terminals, so online businesses can accept credit and debit card and e-check transactions.

A merchant account is a business account with an acquiring bank. Without this business account, which actually works more like a line of credit, a merchant cannot accept and process credit and debit card transactions. Businesses need a merchant account to accept major credit cards via a static point-of-sale terminal, mobile card reader, or through a virtual payment gateway.

After filling out EMB’s simple online application and submitting any necessary, requested documents, many merchants get approved within 24 and 48 hours.

EMB specializes in working with high-risk merchants. EMB works with many merchants, including but not limited to businesses in these industries: gambling and gaming, adult entertainment, nutraceuticals, vaping and e-cigarettes, electronics, tech support, travel, high-end furniture, weight loss programs, calling cards, e-books and software, and telecommunications.

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