ACH merchant account Archives - The Future of Payment Processing is Here!

In 2017, $4.3 trillion dollars changed hands via traditional checks. Despite the relative takeover of plastic payment methods, many are still using checks, as illustrated by the sheer amount of money changing hands with this type of payment, yet businesses are often confounded with regard to how to handle this traditional method of money exchange. Enter electronic check processing. A great way to accept checks and protect your company at the same time, e-check processing can help you ensure your customers can still pay by check without adding to your payment processing hassles. If you’re unfamiliar with this technology, don’t worry. This quick guide can help.

What is E-Check Processing?

An electronic check, sometimes called an e-check, is a form of digital payment where the money comes from the customer’s checking account electronically. Processing this type of payment relies on the ACH network, and all it really takes to get started is an ACH merchant account.

Three E-Check Processing Myths

Despite its simplicity, there are a number of myths surrounding e-checks.

Myth #1 – Echecks aren’t safe.

Outside of accepting cash, there are no safe payment methods today. Paper checks are as much of a risk as electronic checks are. Sure, banks across the United States us a number of different kinds of safeguards to help protect customers like watermarks, but electronic checks are just as safe, if not safer. The process converts the data to a randomized character string, called tokenization, and that helps to seriously reduce the risk of fraud.

Myth #2 – Processing e-checks is expensive.

Processing paper checks comes with costs. Processing credit cards comes with costs. Processing e-checks also comes with costs. No matter what type of payment method you’re accepting from your customers, it’s going to come with a processing fee. Echeck fees tend to be just as low, if not lower, than many other methods of payment.

Myth #3 – My Customers Don’t Care

The decline of the check has been an ongoing issue since 2001. Some customers want to use the funds in their bank accounts, but they’re not sure how to make that happen, and e-checks are a great way to do it. It’s an option your customers care about, as many want to be able to use funds from their checking accounts. Echecks are a great way to do just that.

Ready to start taking e-checks from your customers? Give us a call today to learn how.

Accepting payments in today’s world gets more complicated all the time. Among the newest forms of payment available are e-checks. Understanding this form of payment and the myths around it is absolutely key to helping your business run well.

What is an E-Check?

First, it might be important to understand exactly what this form of payment is. An e-check is an electronic check. The money paid to you for your goods or services is withdrawn from the checking account of the individual paying. It’s transferred using the ACH network, so for e-check processing, you’ll need an ACH merchant account. Overall, this method of payment is a great way to offer your customers one more alternative.

Electronic Check Processing Myths

Despite the fact that e-check processing could mean connecting with many more customers than you do right now, there are still many myths floating around, some of which may be holding you back from accepting this form of payment. Let’s take a look at a few.

None of My Customers Use Checks: The number of people using checks has been on the decline since 2000, giving rise to electronic payments like debit and credit. One Federal Reserve study found that from 2000- 2012, the number of checks written declined by more than 50%. That doesn’t, however, mean that no one is using checks. In fact, many still prefer checks because it leaves a written record of transactions that is easy to account for at any given time. Moreover, the older generation continues to write checks at a fairly high rate.
Checks Lead to Fraud: You may be concerned about checks bouncing because of insufficient funds, and when that happens, everyone loses. While that is a real fear, the rate of check fraud is no higher than that of other types of fraud, and electronic processing has greatly changed the potential for check fraud. It minimizes the possibilities, helping give you peace of mind.
Checks are Too Expensive to Process: E-checks are subject to merchant processing fees, just like a credit or debit fee, and those fees do vary by processing company. It is, however, often cheaper to use this technology than it is to use paper checks, as it completely eliminates the need to manually inspect each check, handle the reconciliation, and make it to the bank to deposit the check.

E-check processing may be the perfect way for your consumers to buy your goods or use your services. Take a closer look at this payment method when you contact Y2Payments today.

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Tag: ACH merchant account

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