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The exponential growth of eCommerce and the convenience of digital money transfers are contributing to the widespread use of all forms of online payment. Online payments make it simpler and easier to receive money from customers and send funds to vendors, helping boost business efficiency. If your business shuns credit cards due to their high processing fees, there’s a lower-cost alternative that can help you send and receive online payments.
Electronic checks ⎼ also known as eChecks or paperless checks ⎼ can help your business send and receive online payments for a fraction of credit card processing fees. Echeck fees are considerably lower than credit cards as electronic checks use a different and more cost-effective payment processing network. Echecks are the ideal solution for businesses that want to process bank transfers without paying exorbitant online payment processing fees.
What are Echecks?
Echecks are the online version of the traditional paper checks. If you’ve worked with traditional paper checks in the past, you know how inconvenient and time-consuming it can be to process incoming and outgoing payments. Due to its electronic format, eChecks enable easier, faster, and more secure financial transactions than conventional paper checks.
Secure eChecks are processed through the Automated Clearing House (ACH) network or Check 21. Using ACH instead of the credit card network to transfer funds reduces payment processing costs, resulting in low eCheck fees. Besides lower processing fees, paperless checks offer plenty of other benefits to businesses.
In this post, SeamlessChex will discuss the top benefits of using eChecks to help you learn more about this alternative online payment processing solution.
Echeck fees are not only lower than credit cards, but they also cost less than processing paper checks. With conventional checks, you pay for the paper check, envelope, stamp, mail, and time spent reconciling. But with eChecks, you don’t have to pay for a physical check and its associated handling and processing costs. Processing paper checks can cost your business $24,540 every year. Secure eChecks, on the other hand, will cost you much less than that, allowing your business to save more money on payment processing.
Paper checks are also very time-consuming to prepare and handle. You will need to hire or retain extra staff to review paper check payments. Reviewing physical checks can cost your business $1,280 per month in employee time. Paperless checks will save businesses more money on employee costs, helping improve their profit margins. Echeck fees end up costing less than paper checks as less hands-on work is required to process payments.
Besides lower costs and fees, eChecks are also quicker to handle and process. Paper checks waste everyone’s time. Customers need to write out a check, put it in an envelope, and mail it to the merchant. The merchant must wait for days to receive the paper check and then deposit the payment into their bank account. A lot of time and manual effort are expended by the payer and payee to process physical checks.
Due to their digital nature, eChecks occur electronically, making the entire payment process last a few seconds. All the tedious steps involved in processing physical checks are eliminated when using electronic checks. With eChecks, you complete and submit a payment form online. After submission, the transaction is processed instantly, delivering the payment to the recipient much faster than paper checks. With quicker payment processing and lower fees, eChecks save both merchants and customers plenty of valuable time and money.
Paper checks are a hassle for both merchants and customers. The inconvenience of using physical checks is contributing to their decline. A report released by the Federal Reserve Bank of Atlanta revealed that the percentage of consumers who use paper checks dropped by 23 percent for paying bills and 8 percent for making purchases from 2015 to 2018. Many consumers have abandoned physical checks in favor of online payments ⎼ like credit cards ⎼ due to their convenience.
Echeck fees are lower than credit card charges, but provide the same level of payment convenience to customers. Paperless checks allow customers to pay merchants from anywhere and at any time. With electronic checks, merchants send invoices to customers via email. Customers can then pay merchants directly using their computer or smartphone. Secure eChecks are also more convenient for merchants as it eliminates trips to the bank to deposit payments.
Fewer Bounced checks
Merchants take in millions of bounced checks from customers every year, leading to significant losses in time and money. Bad checks are more common in traditional paper checks as customers can issue them without having sufficient funds in their bank account. Echecks, on the other hand, can’t be issued if the customer does not have enough funds to cover the payment.
Echecks enable merchants to conduct an instant bank authentication and funds confirmation online before accepting the payment from customers. Many paperless check payment processors use advanced banking software solutions to acquire real-time data on a customer’s checking account. SeamlessChex allows merchants to acquire banking information from customers and verify fund availability before allowing them to submit an eCheck for payment.
With advanced fraud mitigation tools and lower fees, eChecks provide a superior payment alternative to traditional checks, helping businesses reduce the incidence of bounced checks at a lower cost.
Paper checks pass through more hands than eChecks, increasing the risk of interception and fraud by criminals. It is quite easy for fraudsters to steal physical checks from the mail and deposit it in their bank accounts. A report released by the American Bankers Association found that check fraud accounted for 35 percent of all banking fraud. Although eCheck fees and costs are lower than paper checks, they offer a more secure platform for processing payments.
Electronic checks have a variety of payment security safeguards that are lacking in paper checks, offering more protection against data theft and fraud. Many eCheck payment processors ⎼ like Seamless Chex ⎼ offer advanced online security features such as real-time bank verification, identity authentication, data encryption, and duplicate check detection to protect customers and merchants from fraudulent activities. Secure eChecks’ lower fees and extra safety features make it a superior payment alternative to paper checks and credit cards.
Sign Up For eCheck Processing Today
As more consumers move online to conduct their purchases, merchants will need to provide a variety of digital payment solutions to increase sales and boost business growth. The inconvenience of paper checks is making them obsolete, and many businesses can’t offer credit card processing services due to their high transaction fees.
Secure eChecks provide the perfect solution for businesses that seek a convenient and low-cost online payment solution. Echeck fees are lower than credit card transaction charges, but provide the same payment convenience to customers. Contact us now to sign up for eCheck processing services to help your business grow.