On this page we will educate you on what an eCheck is, how it works, and how you can utilize it as a payment method. We find that customers enjoy the flexibility to pay using as many methods as possible, with eCheck being the second most popular (to credit cards). While we understand that most customers would rather pay with credit cards, offering an eCheck has many benefits that we will outline below.
What Is an eCheck?
An eCheck is a form of online payment where money is electronically withdrawn from the customers’ personal checking accounts, and deposited into the merchants’ business checking accounts.
How Does eCheck Processing Work?
eCheck processing is similar to paper check processing, only much faster. Instead of a customer manually filling out a paper check and sending it to the business he/she needs to pay, today’s technology allows the process to happen electronically, saving time and paper waste. eChecks also have a higher level of verification, which results in fewer instances of check fraud.
There are four main steps to processing an electronic check:
- Request Authorization: Your business will need to gain authorization from your customer to make the transaction. This can be done via an online payment form, a signed order form, or over the phone.
- Payment Setup: After the authorization is complete, your business manually inputs the payment information into your online eCheck portal, or it’s done automatically through your website’s shopping cart.
- Finalize and Submit: Once payment information is properly sent to the eCheck provider, it will process the payment.
- Payment Confirmation and Funds Deposited: The payment is automatically withdrawn from the customer’s bank account, at which time you can send the customer a receipt. Funds are typically deposited into your business bank account within 1-2 business days, depending on the bank. Once the payment clears, you can render your service or ship your product. Keep in mind, this does not mean the check is 100 percent valid. Some banks will not verify a check instantly, and sometimes a customer may withdraw money from his/her account or close the account altogether, causing the check to bounce. The eCheck processor offers enhanced check verification services that can help with reducing these occurrences (more on this below).
Four ways your customers can send an eCheck payment:
- Virtual Terminal: Through your new eCheck merchant account portal, you can manually enter a customer’s checking account details (that were received over the phone) to process the payment. This also can be done with a batch of multiple eChecks on a nightly basis.
- Email Invoicing: This method consists of sending your customer an email with a link he/she can click to process the payment on the eCheck provider’s interface. Some customers like this because they initiate the process, and don’t have to share their checking account information.
- Payment Buttons: Add HTML “payment buttons” anywhere on your website, providing customers access to an order page for instant payments.
- Traditional API: Our eCheck provider offers a traditional API to directly integrate your shopping cart. Plug-ins also are available for Magento, WooCommerce and OpenCart to make this integration even easier.
How Much Does It Cost to Process an eCheck?
Our provider charges different fees to process an eCheck based on your business type and monthly volume. Rates and fees for higher-risk businesses usually range from 2-4 percent plus a 0.50-$1.00 transaction fee. There is usually a monthly fee of around $30. Check verification via a live operator is an optional service — the fee is usually $2 per check, but it can be a great service should you have issues with bad checks from customers.
How Can I Get an eCheck Processing Account?
Send your information through our Contact Us form, and we will be in touch within 24 hours.
What Are the Benefits of Accepting eChecks From Customers?
- Since eCheck is not governed by Visa and MasterCard, merchants won’t have to worry about these card associations closing your account.
- The pricing is usually much cheaper than processing on a high-risk credit card account, and there is no reserve.
- Funding is usually one day! So, no more waiting several weeks to get paid on a credit card transaction using a high-risk processor.
- Integration is easy with plug-ins for WooCommerce, Magento, OpenCart and many others. There are several other methods of payment acceptance where you don’t have to integrate, therefore allowing you to build your eCheck customer base before spending time with integration.
- When given the chance, approximately 10-25 percent of customers will use eCheck — and many of our merchants are offering a small incentive (i.e., free samples, 5 percent discounts) to customers who use it.
- Transaction declines won’t be a huge issue like with offshore processing in jurisdictions such as China.
- Friendly chargebacks will be reduced since customers will recognize the transactions on their statements.
- The processor is in the U.S. — with U.S. banks and U.S. time zones.
***Offering eCheck processing to customers has kept many of our high-risk clients in business after they lost a credit card merchant account due to an audit, closure or a processor’s change in policy on a product or service. So don’t delay — get set up with eCheck today!
Ready to Apply for a Merchant Account?