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    What are eChecks?

    For reliable and quick payments, a large number of businesses are transitioning to eChecks. 

    Read on to find out all about eChecks and their key functionalities with ACH and EFT. The following article will teach you how to start using eChecks seamlessly with your existing business transactions along with detailing strategic steps for opening a merchant eCheck account as well.

    How Do They Work? 

    Electronic checks or eChecks are defined as a web-based payment whereby the payment is directly disbursed from the checking account of the paying party and transferred directly into the recipient’s checking account via the ACH network. 

    Here are the four steps for processing electronic checks: 

    1. Approval Request

    With the help of recorded telephonic conversation or forms (online payment and signed forms), you can seek the confirmation of payment from the payer. 

    2. Establish Payment

    Once the payment is authorized, the important financial details are fed into a payment processing software such as QuickBooks. In the case of repeating invoices, the repeating schedule with its details is also included.

    3. Conclude and File

    After the payment details are entered into the application with accuracy, the same is saved or submitted. This is when the ACH transaction begins. 

    4. Disbursal and Deposit  

    The next step is the withdrawal of the payment directly from the account of the payer. Once the disbursal is complete, the client is informed with a receipt detailing the same. The payment is deposited in the bank account of the payee within three to five days from the date of initiation of the ACH transaction. 

    The Differences Between eCheck, ACH, and EFT

    An eCheck payment is a type of electronic funds transfer (EFT). 

    Take a look at the types of monetary transactions included in EFT below.

    • Direct deposits
    • Wire transfer
    • ACH recurring disbursals   
    • Payments that include electronic benefits 

    To process the electronic check, EFT uses the Automated Clearing House (ACH) network. ACH is responsible for processing electronic payments including automated financial transactions. Employed by financial institutions across the United States, it’s a streamlined mechanism designed to transfer money directly between the payer account and the recipient without the use of cash, wire transfers, paper checks, or credit cards.

    Simply put, an eCheck is processed via electronic debiting of the payment from the customer account via ACH to the recipient’s bank, which is then digitally credited into the payee account. 

    How Can I use eChecks For My Business?

    Before you start this paper-free process to complete business transactions, remember that eCheck processes differ by the service provider. Typically, it’s swift and takes up to 48 hours for verifying the transaction and up to five days for transferring the funds. The cost of processing eChecks is low and varies from $0.30 to $1.50 per transaction. 

    Take a look at the following four key benefits of using eChecks for your business. 

    • Recurring ACH payments or recurring eChecks are easier, reliable, and effortless for direct transfers. 
    • Tracking payments is easy when they’re paper-free and automated.
    • High-cost invoices such as rent and mortgage are best completed via eChecks as these will help you save up to 60% as opposed to cutthroat fees of credit cards. 
    • Offering multiple payment choices for your customers via phone or online payment form is a perk of this method. Both the methods include collecting banking information such as checking account and routing account numbers from the customer. 

    How To Get Started With An eCheck Merchant Account 

    In order to receive payments in forms other than cash, such as eChecks, the recipient's small business must have an ACH merchant account. Setting up an ACH merchant account is analogous to creating a merchant credit card account. First, you have to find a suitable merchant account and then furnish the following information to get started. 

    • Federal Tax ID
    • Total Age of Business (in years)
    • Estimated Monthly Processing Volume

    You can create electronic records of transactions that can be automatically synchronized with accounting software. If you’re a QuickBooks customer, you don’t have to go through the above hassles as this invoicing software will process your ACH payments at 1% for every transaction with a maximum charge of $10 per transaction. 


    Now that we’ve defined what eChecks are as well as ACH and EFT, your business can start adopting and accepting electronic payments seamlessly. Electronic checks help you get paid directly, quickly, and effortlessly besides saving you money on credit card processing fees. 

    To harness a hassle-free experience, migrate to accounting software like QuickBooks to start saving time and preciou