Would you prefer to make payments via cash or the internet? If you are more comfortable with making payments via the internet, we present you the Electronic Check (e-check). Let us consider the most frequent asked questions by the borrower to understand e-check online.
What is an e-check?
E-check or Electronic check is an online form of payment; the user transfers the money via the internet or any data network. It is designed to do what paper check does but faster and more efficiently. E-check uses the Automated Clearing House (ACH) and Electronic Funds Transfer (EFT) to process the payments. Payer’s money goes from payer’s account to payee’s account via ACH network. As compared to the old-school paper checks, an electronic check has more authenticity and security. You don’t need a credit or debit card to carry out these transactions. So, save your time and paper by using an electronic check.
How does e-check work?
The inner mechanics of e-check are the same as paper check process. The only difference is that payers don’t have to fill everything manually; every data is entered and processed electronically. Basically, this process is completed in four steps:
In order for the transaction to happen, the customers have to authorize. The customer can do this via an order form or an online payment form. In some cases, the customer can even authorize his bank account by a phone call as well.
- Payment arrangement
With the authorization from the customer, all relevant information regarding the transaction process passes through any online payment processing software. The software might vary from a lender to lender. The payment software also contains all the information regarding the payment terms and schedule.
- Click ‘submit.’
Once the potential business has entered all the payment data, the business can start the transaction with a simple click on the ‘Submit’ button.
After the initiation of the transaction, a said amount is withdrawn from the bank account of the customer, and later the customer gets the payment receipt. The potential merchant can get the funds in two to four business days.
What are the benefits of e-check?
Electronic check online payment system has revolutionized the payment and transaction industry. Some of the benefits are:
Save yourself from a scam and fraud and adopt e-check online. As compared to the electronic checks, the physical checks are risky. With advanced programs such as Address Verification System (AVS) and Credit Verification Value (CVV), e-checks are safer. All the information shared by the customer remains confidential and private.
– Affordable transaction fee
Usually, e-checks come with a lower transaction fee as compared to the traditional ones. With a flat fee ranging from $0.50 – $2, you can save some cash on larger transactions. E-checks help you save time and a lot of money especially if you run a B2B (business to business). For example, a transaction between a manufacturer and a wholesaler with a two to five percent per transaction will cost you more. So, which one payment method is more convenient? Think ahead, and save money so that you can invest in other projects in the coming future.
– Reduction in the labor cost
If you are carrying out your transactions through online channels, you are reducing the labor cost. Think about it, with all the saved trips from the banks you can save fuel money and minimize labor cost. This method is more convenient for you, with all the saved money you can buy a new piece of equipment.
By introducing e-check online, you can build a rapport with your clients for they don’t have to take some time of their lives to write and collect the checks. Provide convenience to your customers and ensure customer retention.
With these benefits, one must take a chance on E-check!
What are the drawbacks of e-check?
Despite having multiple benefits, e-check has a one or two drawbacks.
As e-check is a growing industry, multiple changes and improvements are on the way. Credit cards work at lightning speed, but payment made via e-check takes at least three to six business days to process. So, unless you need funding at the very moment, you are good to go! But if you need funds in two to three days, then it is better to apply for a short-term loan.
– Education about e-check
With a routing number and a checking account, your customers can authorize an e-check payment easily. But those who are comfortable with physical checks might find e-check as a different notion. With all the facts and tips about e-check, customers will prefer this payment option.
Is e-check a secure payment method?
A staggering decrease in fraud and theft has been reported since the introduction of e-check online. Looking at e-check from the customer’s perspective, fewer people come across the bank and account information, and no one has to take the responsibility to handle the check. If your account is facing any fraudulent charges, the bank will offer compensation. So, through this secure payment method give yourself and your customers a peace of mind.
Lastly, if you run a retail business, there isn’t any reason to dismiss the idea of incorporating e-check into your business. With low transaction fee, secure transfer of funds, and flexible electronic payments, you can save both money and time. So, what are you waiting for? Use e-check to carry out the everyday transaction and grow your business rapidly.
If you think your small business can benefit from e-check, then head over to our website and find out everything there is to know about eCheck online. Moreover, for updates on the current trends in the small business lending industry, you can follow us on Facebook (@Onlinecheck) and Twitter (@Onlinecheck). If you have any question, feel free to call us on our toll-free number at (833) 827-4412, our loyal and keen financial advisor will answer your every question and guide you throughout the way.