When to use an eCheck

Buyers now have a huge range of different ways to pay for goods and services. From a handful of cash to a wave of an NFC-enabled smartphone, we’ve never been offered more ways to part with our money. Paper checks remain among the most popular methods, even for businesses, in part because they’re familiar and have a ready-built infrastructure. But also in part because they’re simple and relatively secure; it is much easier to steal a credit card number than to alter or forge an eCheck.

And, of course, checks are also cheap. The alternative to a check is usually a credit card company which can charge 3 percent or more as a transaction fee, or a wire transfer that can cost $30. In contrast, checks can look like a reliable and low-cost alternative… and eChecks remove much of the slow speed that can drag down their use.

Payers then should consider using eChecks in the following circumstances:

  • To pay large amounts

There’s a reason that insurance companies (and lotteries) usually make their payments with checks; other methods are much more expensive. When you’re moving a large sum of money from one account to another, a check is usually the cheapest option and it’s cheaper than other payment methods that may take a percentage of the transfer amount as a transaction fee.

That doesn’t mean that you can’t also use eChecks to move small amounts, but a small additional transaction fee that might be charged by a digital payment platform will buy a much faster process.

  • When you would normally pay by check

There’s really no reason any more to write payments on pieces of paper. The banking system is entirely computerized. The checks are only going to be scanned and digitized as soon as they reach the bank so you may as well save yourself the paper and both you and the bank some time by doing it all online anyway, and you will care more about your account accuracy than anyone else will. Ask the payee if they can accept an eCheck instead of a physical check.

  • When you have to make regular payments

Making regular payments by check is a pain. Landlords, for example, often demand a pile of dated checks which mean that you have to sit and write them out by hand. Far better to set up a payment process that’s as reliable as an automated transfer and you only need to fill in the online form once.

  • When you lack funds in a payment platform

One easy alternative to making payments that could be made by check or eCheck is to use a digital payment platform. The transfer is almost immediate and the rates, especially for small payments, are always competitive. Sometimes the transfer is even free.

But not everyone keeps funds available in their online accounts. If you find that you don’t have enough funds to make that simple transfer and don’t want to wait to bring money into the account, an eCheck can make a useful alternative.

For payees, the decision to accept an eCheck is even simpler:

  • When you don’t need to make immediate delivery.

eChecks are faster than paper checks. Cash is, of course, immediate and a transfer made through an online payment platform is lightning fast. An eCheck might mean a delay of a day or two, which is fine for most online purchases, and it also works for regular payments like rents. If a businessperson can take a check, they can take an eCheck.

  • When you’re paying the transaction fee.

Sometimes the payer pays the transaction fee, and sometimes the payee pays. If you’re paying by eCheck, it has both the cheapest and the most convenient option.

  • When you want to make life as easy as possible for your customer.

Businesses should put as few obstacles as possible between the customer and the cash desk. It’s possible that a business owner will have customers who don’t have credit cards or who are reluctant to use them online. You might be selling in person to someone who doesn’t have cash or who is demanding a payment on an online platform that they aren’t using. Accepting an eCheck along with all your other payment options makes it easier for the customer to pay the bill and buy your services.

Writing a check is simple and familiar. Writing an eCheck becomes simple and familiar, as well. You merely need to have your bank account number and your routing number. Using an eCheck is not a huge challenge and for either buyers nor sellers, and it’s a valuable addition to the range of payment options.