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Multiple payment methods: high-risk e-checks

Are you selling high-risk products online and considering adding more payment methods to your e-commerce store? We would like to offer some expert advice to see whether accepting e-checks might be a good option for you.

At Blue Payment Agency, we help a range of high-risk businesses address their online payment needs. We help e-commerce site owners set up payment gateways with NMI, and we offer both merchant account and payment gateway accounts and “gateway only” accounts. In our pursuit of making online payments as easy as possible for high-risk site owners, we provide a wide range of advice and recommendations as well.

All businesses are different, and we make sure to provide varied and comprehensive advice that can come in handy for you when choosing a payment processor, choosing different payment options, and more.

You know your business better than what we can anticipate in an article. This is why we’ll simply outline the pros and cons of accepting e-checks for high-risk products. Ideally, this will make it easier for you to decide whether high-risk e-checks are a payment method you’d like to add to your arsenal.

What is an e-check

Multiple payment methods_ high-risk e-checks - Blue Payment Agency - Quote Image

E-checks, as the name suggests, are electronic checks. They are sometimes referred to as ACH payments as well. However, the similarities between standard checks, ACH payments, and e-checks don’t end with the name. They all function and work fairly similar and operate within the same legal framework.

From a legal perspective, this makes e-checks, even though it’s a relatively “new” payment method, one of the most established ways of accepting payments for services and products online.

How they work

The process and how it works is pretty straight forward:

  1. The customer enters his/her checking account number and routing number online.
  2. The payment is then transferred electronically from the customer to your bank account.

That’s basically it. There’s not much hocus pocus to it, as it’s a simple entry of bank details that enable a direct transaction.

Benefits of offering an e-check payment method

There are a number of benefits to providing e-checks for your high-risk products and services. To make it easy to assess them, we’ll list them in bullet-points.

  • Lower processing fees: Generally, e-checks come with significantly lower processing fees than credit card processing.
  • Lower chargeback ratios: Across the board, the risk of chargebacks is a lot lower with e-checks compared to other payment methods.
  • Catered to broad preferences: Different customers prefer different payment methods for a variety of reasons. Offering a greater variety of payment methods could entice customers who would otherwise be deterred.

Cons of accepting e-checks for your high-risk business

The benefits of accepting e-checks are quite impressive. However, there are some drawbacks to keep in mind, especially as a high-risk business. At any rate, let’s get down to the cons.

  • Checks take time to clear: Even today, with improved connectivity and technological processes, checks can take a few days to clear. As opposed to credit card payments, this payment method means that you can sell your product but receive the funds a couple of days later.
  • Checks can bounce: About the above, checks can actually be rejected. Whereas debit and credit card payments are instantaneous and the payees’ available funds are instantly assessed, although not immediately deposited, checks can be initially accepted only to bounce later due to a lack of funds in the buyer’s account.

What to be wary of concerning e-checks and high-risk e-commerce

While e-checks have some powerful benefits, with lower processing and chargeback rates, there is one aspect in particular that needs attention.

High-risk businesses, whether they’re selling services, physical products, or non-physical products, are more at risk of fraud. The combination of slow clearing times, the possibility of bounced checks, and the risk of fraud can be an overall negative combination.

However, the decision really does depend on your unique business, your target consumer, and the particulars of your industry and niche.

Checks remain relevant in the digital age

While most people today are extremely familiar with using credit cards to pay for products online, there are still demographics that prefer the simplicity of checks. Offering electronic check payments for your products could improve your relationship with, if not fully opening up, a new demographic.

Credit card payments are still the most widely used online payment method today, though. For more information on how to accept different payment methods online, you can take a look at these resources:

Get expert advice on whether to offer high-risk e-checks today

At Blue Payment Agency, we’re here to do more than offer payment gateway accounts and processing set-ups. Our aim is to make online payments easier as a whole. With years of experience in assisting high-risk e-commerce site owners, we’re ideally equipped at recommending both payment gateways and payment methods.

Simply contact us today, and we’ll help you assess whether e-checks are ideal for you. If you’re also looking for a better payment processing service than the one you already have, we’re always happy to help. You can contact us here or give us a call at 844-253-9769.


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