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eChecks Checkout
Have you ever considered accepting checks online? You may not have,
but thousands of businesses are already collecting checks online.
In fact, in the first quarter of 2004, more than 163 million checks
were processed online just like credit cards, but with additional
benefits.
No Merchant Account, Low Discount Rate
First and foremost, to process checks online you do not require a
merchant account. When processing credit card transactions using a
merchant account, 2%- 8% of the transaction value is paid to the merchant
account provider – this is the cost of doing business using
VISA, Mastercard ,etc. So, if you are receiving $1,000.00 by credit
card, that transaction will cost you at least $20.00 (2% of $1000.00
= $20.00). The same transaction will cost less than $4 when processed
by eCheck. Not requiring a merchant account – only a low discount
rate roughly one tenth that of those required to process a credit
card – is revolutionary news for proprietors and represents
the dawn of a new age in online transaction processing.
Low Monthly Fees
In addition, the discount rate charges for credit cards outlined above
do not take into account the fees that are collected by Payment Gateways.
Payment Gateways (technology providers that facilitate online transaction
with banks in real time) charge monthly fees from $20.00 to $80.00
per month, PLUS per transaction fees of approximately $0.30 per transaction
(though rates vary). By contrast, eCheck processors require monthly
minimums which are less expensive than the monthly charges required
by Payment Gateways. Sometimes, as is the case with VeriSign,
pay gateways offer ACH payment bundled with credit card payment services
at no additional cost.
Low Setup Fees
Better still, while merchant
account providers and payment gateways require setup fees which
typically range from $50.00 to $250.00, eCheck processors (like
Electracash) charge lower setup or application fees, effectively
eliminating any disincentive to providing this payment option for
your customers.
Quick Setup
Because eCheck service providers do not require merchant accounts,
it is usually they themselves who underwrite your transactions. eCheck
providers simply charge a transaction fee (go here for special
2ndSite rates) on any transaction paid to you. Should you be classified
as "high risk" the processor may withhold slightly more per transaction
until a reserve is created for your account, which then acts as their
insurance against charge backs. By gradually adding to this reserve
using portions of your per transaction revenue, eCheck processors
help your business grow by not hampering your cash flow with setup
fees.
Ideal for Low Volume
Because there are low setup fees, low monthly fees and low sales volume
expectations (for example Electracash expects a monthly minimum of
only $15 in transactions, where as merchant accounts expect $20-100+
as a monthly minimum), eChecks processors provide low volume merchants
with a low risk, low investment online payment option. Since fees
are collected on a per transaction basis only, and since a very low
discount rate is charged, eChecks provide a cost effective, scaleable,
low risk alternative to credit card processing.
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2ndSite Recommended!!!
These are just a few of the benefits of eChecks. We at 2ndSite believe eChecks are the future of online commerce for business to business transactions. If you would like more info on the subject, please call us at 1.866.303.6061.
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