What Is an Online Check Payment Called?

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What Is an Online Check Payment Called?

As the business world continues to advance, business owners are learning the benefits of using e-checks to transact with their online clients. You, too, should accept check payments online for many reasons. 

An online check payment is commonly referred to as an ‘electronic check,’ or an ‘e-check,’ as well as an ‘internet check,’ an ‘online check,’ or a ‘direct debit.’ Digital checks work slightly differently than a traditional paper check.

Thinking of creating options for e-check payments for customers or vendors? This article will dive into everything you need to know about online check payments, including their benefits.

What Is an Online Check Payment?

An online check payment is a check processed through the Internet or any other data network. An e-check functions the same way a traditional paper check does. However, e-checks go through fewer processing stages than a paper check.

Furthermore, an e-check can be monitored from when it’s drawn from a customer’s bank account to when it’s deposited into your bank account. So, you can know the progress of your payment through a simple e-check payment status check.

The most common version of e-check today is the direct debit system. This form of online check payment is commonly used by employers to pay their workers, but you can also use it to pay your vendors and suppliers.

How Does an E-Check Payment Work?

When you’re making payments using an e-check, you need to use the Automated Clearing House (ACH) system to deposit the check directly from your checking account into the recipient’s bank account through a payment processor. An ACH is an electronic network used by American banks and other financial organizations to process online payments; it’s designed to provide companies with a safer and faster infrastructure to process their payments.

An e-check is fully transmitted electronically–this is one of the main differences between an e-check and a conventional paper check. With a paper check, it has to be physically delivered to the recipient’s bank for processing.

An e-check is part of the broader Electronic Funds Transfer (EFT) system used by banks and other financial institutions to process payments online. Other common types of payments included in the EFT system include: 

  • Wire transfers
  • Electronic benefits payments
  • ACH disbursements

How Long Does It Take E-Checks to Process?

The duration that your e-check payments take to clear depends on many factors, including the type of payment processor you choose. You should work with a trusted and well-established online payment processing company that has all the necessary payment processing solutions to carry out high-risk transactions safely and quickly.

With a payment processing firm like Seamless Chex, you can expect a full suite of reliable and innovative payment processing solutions with amazing products for all payment rails, including:

  • Verified ACH
  • Check21
  • Credit cards
  • Debit cards
  • Traditional ACH

Processing E-Checks

An online check payment takes several key steps, from requesting payment authorization from your customer to receiving the funds in your bank account with many steps in between.

You start by requesting your customer’s bank for authorization to withdraw the amount from their checking account. The bank will need authorization from your customer to release the money.

Once the client authorizes the transaction, the bank will upload the transaction details into the payment processing software. The payment processing firm will verify the payment details and submit them to ACH for payment processing

After the e-check payment has been processed successfully, the funds are withdrawn from your client’s bank account and deposited into yours. The entire process takes between three to eight days, depending on the type of transaction you’re making.

High-risk transactions take longer because they have to be verified thoroughly before the money is withdrawn from the client’s account. Your payment might take longer than three days if your client cancels the authorization or the e-check bounces.

Seamless Chex and You

Seamless Chex offers exclusive products for online payment processing, including Seamless Chex, Paynote, and Seamless Merchant. With these solutions, we can process all kinds of online payments, including high-risk transactions. 

Through the Seamless Chex platform, your e-check payments will be verified and submitted to the ACH immediately for faster processing!

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