With so many payment options coming to the fore, eChecks have been gaining ground in the last decade. In a Federal Reserve Payment Study in 2016, it was discovered that ACH payments grew at a yearly rate of 4.9 percent from 2012 to 2015.
The Most Popular Questions About eChecks With Answers
Businesses that are interested in accepting eChecks as another payment method have many questions as to how eChecks work and the cost. We will be addressing these and other questions below.
- What are eChecks?
Electronic checks, also known as eChecks, are a type of payment that can be made online or another type of “data network”. eChecks are made to function identically to a conventional check. And since this type of check is electronic, processing can take place in fewer steps.
- How Do You Process An eCheck?
A business begins by requesting authorization to process an eCheck on an online payment form, a signed order form, or an agreement by phone.
Once the authorization process is done, a payment gateway will accept all the data related to the payment. Once the payment gateway receives this information, the ACH transaction process begins.
- What Are The Benefits Of Accepting eChecks?
Processing fees are considerably lower than for processing credit cards.
Another great benefit that eChecks offer is security. Surpassing the safety measures of traditional paper checks, eChecks offer public-key cryptography, digital signatures, encryption, authentication, and so much more.
- What Are The Differences Between An eCheck, An ACH, And An EFT?
An EFT is known as an Electronic Funds Transfer. This can take place in the form of wire transfers, eChecks, direct deposits, ACH disbursements, and Electronic benefit payments.
ACH is known as the Automated Clearing House. This is the U.S. electronic network that enables users to send and receive digital transfers to individuals and merchants.
EChecks are a form of EFT that needs an ACH network in order to get processed.
- Can I Use eChecks For Recurring Billing?
Absolutely. EChecks are quickly becoming the most popular type of recurring payments. Recurring eChecks are similar to recurring ACH payments. In order to set up recurring eCheck payments, you will need to get in contact with your payment services provider.
- How Do I Send An eCheck Payment?
- The online form: The receiver can send you an online payment form to send in or you can find it on the merchant’s website. You need to include your checking account number, the routing number, and the amount of payment. Then you click “submit” giving permission for the fund’s withdrawal.
- A recorded phone call: A payee can ask for your checking account and routing number on a recorded phone call. The payee enters your financial information and the amount of payment on the online payment terminal. The payee then clicks on “process” and the payment transaction begins.
- How Much Does It Cost To Process An ECheck?
Fees will vary depending on the business. Typically, an average eCheck fee ranges anywhere from $.30 to $1.50.
- When Will I Receive The Funds From The eCheck Payment, As A Merchant?
The clearing process varies depending on the payment service provider. Normally it takes 48 hours. If the payer has sufficient funds in their bank account, the merchant can expect to receive their funds within 3 to 7 business days.
The Many Benefits Of eChecks
Businesses would do well in adopting as many payment methods as possible in order to cater to a wide variety of clientele. With eChecks, you simply can’t go wrong as it is one of the most secure and affordable methods to accept payments.