How Does eCheck Processing Work?
To process check payments, a bank must verify a physical check and send it to the other bank, which verifies the physical check. echeck payment processing truncation refers to the process by which banks verify fund transfers with digital checks. Check truncation eliminates the need to transport physical checks by allowing both banks to verify a digital check.
Although echeck processing is faster than standard check processing, the information required for parts processing continues as before. When initiating an electronic check, the customer must provide their bank's account and coordination numbers, as well as their approval, as opposed to what they would with a paper check. In both cases, sellers must have portion management of eChecks enabled to recognize this portion, while there are no limits preventing brokers from accepting genuine checks.
How do eChecks work?
Electronic echeck payment processing solutions are processed via the ACH (Automated Clearing House) network. A customer provides their bank account information (bank routing and account number) for processing. Using the customer’s bank account information, an electronic request is made to charge the customer in the amount of the purchase.
Authorize.net receives the electronic request and stores the transaction in the
“batch” with your other transactions for the day.
At the end of each business day, a request is submitted to the customer’s bank through the Automated Clearing House (ACH) to charge that particular customer.
The eCheck system waits for the result of the transaction from the bank. This process usually takes two to three (2-3) business days.
The funds are transferred (via electronic funds transfer, or EFT) from the customer’s bank and deposited into your business bank account.
Your eCheck account balance is updated depending on the results of the transactions.
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