How do electronic checks (eChecks) work? How long does it take for an electronic check to be processed? Well, all these questions have been answered in the article below. I will go further into assessing the safety and risks of using eCheck payment processing. You will also read about green eCheck payment processing at Wells Fargo
What is an eCheck?
An eCheck (Electronic Check) is an electronic method of payment where the buyer’s financial account loads funds. With an eCheck, you can make payments through the internet.
Further, with an eCheck, you can send money to anybody across the globe, and the recipient should receive the cash within 4-6 working days. Nevertheless, when you do an Instant Transfer, the person receiving the money gets it immediately.
In essence, if you are a service provider or merchant, it means with an eCheck funds are electronically transferred into your bank account from a client or customer’s bank account directly into your bank via the ACH system.
How to convert a paper check to eCheck
Apparently, you may think of checks as official papers for payment. But, even if you write your check in a paper by hand, the check can be converted to an eCheck. Converting the paper check to an electronic check can only be done at the cash register.
One of the primary benefits of having an eCheck is that it results in the funds leaving your account faster than when using the paper checks. Converting the paper check to an eCheck can be accomplished using the check-reading machines.
Typically, the bottom of your paper check consists of unique numbers, which have been printed in particular fonts using the magnetic ink.
These numbers make it easier for special devices to get the specific information needed to convert the paper check to an electronic check.
Of great importance is that you are always advised to make use of recognized and registered financial institutions when you want to convert your paper check to an eCheck.
Is eCheck safe?
Yes, an eCheck is safe. In particular, the eChecks can be reversed under three conditions, which make it a safer form of payment. First, you can receive a refund if you never authorized a payment or a purchase if you were buying something.
Secondly, you will receive a refund if your eCheck was processed on an earlier date than the one indicated or authorized. And, thirdly, your check will be reversed if the amount of payment is different from the one that was authorized.
Also, the eChecks are safe because they are processed and handled by an automated machine. Which means there are less or no errors that could result in the loss of funds from your account.
High-Risk eCheck Processing
High-risk eCheck processing can either be operated through the ACH (Automated Clearing House) network or through the eCheck hi-tech grounded on check 21 bank-to-bank data transmission.
Usually, the high-risk eCheck processing approach used is primarily established using the requirements of the type of business involved.
As opposed to card payments, the high-risk eCheck processing providers a lower electronic check processing, irrespective of the type of technology employed.
How are eChecks processed?
eChecks processing starts when your client writes a paper check when purchasing goods or services from you.
As a service giver or merchant you run the check through an imager or reader, which captures the needed information including the account number, check number, and the bank’s routing number and your related information to successfully accomplish the one-time e-payment.
Afterwards, a receipt is produced and printed for the client to sign, the check is annulled and returned to the customer. The business deal will appear on the customer’s bank report as a debit.
Finally, you are then required to upload the captured check information for processing, and the funds are loaded into your account within a maximum of two days.
Are eChecks processed immediately? (Processing time)
The eChecks processing time basically highly variable from one provider to another. But, averagely for most providers, the eChecks are processed within a maximum of two business days. In other, that is to say that eChecks are never processed immediately as some people might be thinking.
How to pay with eCheck – Offline and Online
An eCheck works in the same manner as the paper check but the difference is that all the eCheck processing happens online.
However, offline brick and mortar businesses can make use of the same approach to convert an instant paper check into an electronic check.
If you are a merchant or service giver, you can set up an offline payment option to allow your clients to pay with an eCheck.
All you need to do is click on the offline payment methods and click the offline eCheck payment method on your store set up payments.
Online, means you are connected to the internet. In this approach, you use the ACH system to allow clients to make payments using the eChecks.
Stores that Accept eChecks
There are numerous stores that accept eChecks as one of their payment methods. The following are some of the stores.
- Aeropostale: The type of online check applied or accepted is the PayPal connected to checking account.
- H&M: The kind of online check accepted is the invoice or PayPal linked to a checking account. An individual is expected to pay within 20 days if he or she uses an invoice.
- QVC: The online check approach accepted is the paper check sent through the email. The check must be received within ten days of placing an order otherwise the order will be annulled.
- Target: The online check accepted is the PayPal connected to the checking account.
- Walmart: The online check approach accepted is the PayPal linked to the checking account.
eCheck Payment Processing with Paypal
If you wish to send someone money into their Paypal using eChecks, then you will be happy to learn that the process is the same as any other eCheck. Once you send the money to them, it will be loaded into the PayPal accounts. They would then receive the checks 48 to 72 hours later.
References on eCheck Payment Processing
READ MORE: How to upload a check to a prepaid card fast.