To amplify their virtual payment options and provide value, many businesses are taking initiative to accept E-Check payments. If you’re restless about how to accept E-Check payments, this article will direct you through how to make it happen. With the use of electronic payments rapidly growing worldwide, it’s clear that customers see-through convenience when deciding how to pay. Because of this, E-Check merchants are seeing progress across the board. Read on to find everything you need to accept E-Check payments online and the technical tools to make it possible and make your business well to do.
Know About E-Check
Electronic checks, or E-Checks, are the digital alternative to the traditionally used paper checks. They are also called Automated Clearing House (ACH payments), Direct Debit, or ACH Transfers. E-Checks are digital payments that come directly from your account. E-Checks use the Automated Clearing House (ACH) to direct debit from a customer’s checking account into a merchant’s business bank account, with the assistance of a payment processor.
Just like with paper checks, electronic check payment processing requires users to provide their information like their routing and account number to send a payment. This differs from the traditional credit card processing route where the card and billing information is needed for completing a transaction process.
Know Your Processing Time When You Accept E-Check Payments?
When you accept E-Check payments, funds will normally be verified and processed within 24-48 hours. Funds will not be moved and processed from the original account to the destination account until about 3-6 days after the initiation of the process.
If you are wondering why this process takes very many days, it’s because of the ACH system’s nature.
Since payments are processed in a bunch of quantities rather than on a per-transaction basis, ACH systems are considered a third party when working with E-Checks in general. Many misconceptions are surrounding ACH payments and why they take so long to complete the process. Because of this, it’s important to do your research and know the facts, and adapt the process.
How E-Check Process.
To know how to accept E-Check payments and how the process works, we must first look into the Automated Clearing House (ACH) system. The ACH allows the merchant’s bank and the customer’s bank to exchange details during a transaction. The 2-way flow of information allows banks to share data like the type of transaction, the price, and the buyer’s and seller’s details. It is important to note the ACH processes payments in batches. This batching affects the time it takes for payments to process and is completely clear.
If you are an online business operator, all you need to do is to accept E-Check payments and set up a merchant account. E-Check comes with the standard and big majority of E-Commerce merchant accounts. Online customers would simply decide to make a purchase and choose E-Check at checkout, this smooth process is always encouraged by the customers.
Because E-Check merchants do not have to pay interchange fees, banks can escort businesses directly with each other. This leads to big savings in your pocket when you consider businesses that deal with a high volume of transactions each month and this keeps on multiplying every month if things go well. Accepting E-Check is a great way to avoid the uncertain or heavy expenses that sometimes come with other types of payment processing.
From gym memberships to rent payments to beauty salon yearly subscription and magazine subscriptions, accepting E-Check payments makes collecting recurring payments from your customers easy. E-Check is the best and lovable among subscription-based businesses. It is very simple to regularly accept E-Check payments online after clients provide the necessary account information and you reciprocate them with the subscription.
Difference Between E-Check Payments and Credit Card Payments.
There are both differences and likenesses between E-Checks and credit cards. For reference, when a business owner takes a step to accept E-Check payments, the processing fees are at a cheaper rate. This is because fees cost less for the ACH system than the card network. Depending on the supplier, card networks can have processing fees which they probably charge is 3.5% and up, while on average, ACH rates can be as cheaper as 10 cents per transaction up to 1.7% of a sale.
Credit card payments are usually accepted in most enterprises. They are accepted in many ways, including credit card terminals, QR codes, POS systems, and many more. In General speaking, for online or CNP transactions, merchants will need a virtual terminal, gateway, or E-Wallet solution.
On the other hand, if you will collect E-Check payments online, the software is required. If you want to accept them at your physical store, then hardware in the form of a check scanner will be needed. In the end, it’s best to speak to an ACH payment processing provider to find out what will go in your business best.
E-Check Merchants Benefits.
While not being able to process payments quickly may seem like an inconvenience, the many benefits to accept E-Check payments outweigh the plus points. By offering this sort of payment, E-Check merchants get:
- Low Processing Fees: E-Check processing fees can be as cheaper as 10 cents per transaction. This makes them lower in cost than other electronic payment options.
- Accuracy: E-Checks tend to reduce human error. If you run a B2B business or use paper checks consistently, getting correct information the first time around is key. In addition, the payment is electronic, the transaction data is gathered in a log that can easily sync with your accounting software. This can help you boost efficiency and leads to no delays.
- Security: Many customers thinks if E-Check is safe or not. However, this type of payment option uses a variety of security measures to help secure from fraudulent activity and increase consumer trust. Encryption secures sensitive customer information such as their bank and their native number. And since no physical check is in the hand, there is no risk of losing or misplacing one. Additionally, certificate authorities help to provide secure communication, protect cardholder information.
- Dependability: Both the Federal Reserve and the National Automated Clearing House Association give strict guidelines on how banks and other participants should use the ACH System, which they regulate.
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Ready To Switch Your Decision?
If your business is still accepting paper checks, it’s time to adopt E-Check technology and change according to the trend. Many have changed their mind and become E-Check merchants. This comes at a time that consumers look for more secure and convenient methods to purchase items.
Adopting cashless systems is more important than ever, and is considered the best decision ever. Now that you have learned how to accept E-Check payments, contact an established provider today to boost efficiency and customer satisfaction, eventually the perfect step to climb on. Be a wise decision-maker and upgrade yourself with the trends and technology.