What Is An eCheck: The Future Of Online Payments?

What is an echeck_ The Future of Online Payments_

An e-check or electronic check refers to a payment medium generally made through the Internet or other data networks. The reason to design this is to operate like a traditional paper check. However, the e-check consists of an electronic format and is usually processed in simpler steps. 

Nowadays, everyone is asking what is an echeck. Thus, in order to enlighten a large chunk of users, this article has pinpointed some interesting facts about this mode of online payment. In comparison to a conventional paper check, eChecks have a higher level of security features such as authentication, cryptography, etc. Keep reading to discover more about it. 


What Does An eCheck Refer To?

What Does An eCheck Refer To_

Gone are the days when you have to wonder what is echeck. To state it in simple terms, an eCheck is just a digital mode of a paper check which is infamous as an electronic check, or internet check. These checks make use of ACH or Automated Clearing House

It is to debit money straightforwardly from the checking account of the customer to the merchant’s business transaction account. You ought to know that there is a payment processor that works as a mediator while drafting out an eCheck. Since these are electronically transmitted, transactions made are not only easier but also safer and quicker. 

To understand what is an echeck in the right way, one must know its use in a digital format. It is an optimum solution for businesses that are yet to establish since it offers a convenient mode of money transfer. 

Steps Of An eCheck Payment Processing

Steps Of An Echeck Payment Processing

Just like a paper check, the eCheck serves a similar purpose. The only difference is in the steps involved. Primarily, there are three steps in processing an echeck payment. Check them out here:

Request For Authorization 

As already mentioned, the consumer should authorize their payment if they want to carry the transaction forward. This is easily done on the phone or online simply by applying a signed order form. 

Information Related To Payment

After the authorization of the payment by the consumer, the payment might be set up by the business. Entering details into a payment processing system is the next step, whether the payment is recurring or one-off. 

Payment Confirmation

After entering the payment information, the business can now submit details to begin the transaction using the ACH system. This is when the funds are going to be dedicated from the customer’s account and gets deposited into the account of the business. 

After the commencement of the ACH transaction, eCheck processing usually takes between two to five business days. 

How Do I Pay With eCheck Online?

How Do I Pay With Echeck Online_

If that’s a question that has been concerning you, then this section of the article is exactly for you. Whenever consumers initiate an eCheck, they authorize electronic funds or digital payments between the merchant’s bank account and theirs. Merchants might achieve this authorization in a number of ways. They can either include an authorization form, a signed contract, or an order form. 

The bottom line of the question “what is an echeck” is that the merchant obscures a confirmation. This indicates that the consumer is all set for the money to be diabetes. Echecks might be a form of recurring mode of payments taking place itself with authorization. 

With such authorization in hand, all requisite information will be needed by the merchant in order to execute the dedicated payment processing. This involves the consumer’s bank account number. However, if the payment is recurring, the merchant is going to collect the details concerning the payment schedule. 

Are e-Checks Any Different From Credit Cards?

Are e-Checks Any Different From Credit Cards_

At a common level, there are no functional differences between a credit card and an e-check; they all are valid mechanisms used by people. How these payments are processed is the main concern of the users. 

Credit card industries maintain their personal infrastructure of payment processing. These refer to private networks that capture transactions made by a credit card user. Due to this exclusivity, there are a number of fees related to its use. Additionally, unlike a credit card payment, you have to know how to write an electronic check. 

Electronic checks also depend heavily on the ACH network. Thus, the processing fees are usually lower when an ACH payment is included. eChecks do not incur interchange fees for the credit card. Also, the price of using them is as low as 10¢ on each transaction. For brands that are completing tons of transactions every year, this might turn into a major saving. 

How Secure Is An E-check?

How Secure Is An E-check_

There is no doubt in the fact that e-checks are extremely secure as compared to paper checks. When it comes to calculating the security of an eCheck, there are four key points to consider. 

  1. Verification- The first step is authentication in the eCheck payment process. It simply indicates the customer is giving his consent for transferring funds. Verification is all about ensuring that there takes place no fraudulent payments inside the business setting. 
  1. Encryption- Encryption refers to the established practice of cybersecurity where sensitive data is concealed through a secure digital network. It comes right after you have gained insight into what is an eCheck.
  1. Digital Signature- A digital signature is simply a timestamped signature that helps in protecting against fraud. 
  1. Certificate Authorities- Refers to an entity that signs, stores as well as issues online certificates such as the infamous SSL certificate. Thereby certifying the public key ownership in data encryption.

Benefits Of Using E-Checks

Typically, the costs that are related to issuing an electronic check are usually lower compared to the ones that are related to a paper check. Not only are there zero requirements for a tangible paper check, which charges money to produce, but also e, checks literally do not need any physical postage in case those payments are being made to institutions that are beyond the direct reach of the organization that is issuing the funds. 

As per the estimates, getting a physical paper check printed and issued will cost an organization something around $4 to $20. On the other hand, the average fee that is needed to conduct a single e-check transaction will be somewhere between $0.30 and $1.50. 

Also, compared to a paper check,  an e-check does not need the same beforehand effort from customers to write the check first and then mail it. You will also not need to wait for the arrival of an e-check in the mail before you process the payment. This trims down the total payment time for echecks remarkably. An average commercial mail takes around three to five business days to arrive via the US Postal Service. Take these days and add them to the extra three to five days that a check takes to settle. The minimum time that a paper check takes to receive payment is at least seven business days. Contradicting to this, the total time that an e-check takes is just two to five working days once you receive the authorization. 

Compared to its paper counterpart, it is a lot easier to automate the preparation, processing, and reconciliation of an echeck. With the correct accounting software, one can easily arrange for the direct debits of customers to be recurred automatically. The information on the account and its authorization needs to be captured only once. 

Because checks have the potential to automate either recurring payments, they are not just convenient for an accounting team but also for your customers. Even for the one-off e check payments, you may give customers a smooth experience of payment by letting them save their payment information in the digital wallet by using the AR automation software. 

Once you start accepting the digital payment system like echecks, it helps you offer your customers the ultimate experience of payment that they are looking for – a payment experience that prioritizes digitization and convenience.


We hope you got your answer of what is an echeck. Besides, there are other important details that one might know and consider while making an echeck transfer. Pay safely with the help of electronic checks and switch to a digital mode of payment.

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