how an electronic check e check works
an electronic check is part of the larger electronic banking field and part of a subset of transactions referred to as electronic fund transfers efts this includes not only electronic checks but also other computerized banking functions such as atm withdrawals and deposits debit card transactions and remote check depositing features the transactions require the use of various computer and networking technologies to gain access to the relevant account data to perform the requested actions electronic checks were developed in response to the transactions that arose in the world of electronic commerce electronic checks can be used to make a payment for any transaction that a paper check can cover and are governed by the same laws that apply to paper checks this was the first form of internet based payment used by the u s treasury for making large online payments benefits of electronic checksgenerally the costs associated with issuing an electronic check are notably lower than those associated with paper checks not only is there no requirement for a physical paper check which costs money to produce but also electronic checks do not require physical postage in cases of payments being made to entities outside the direct reach of the entity issuing the funds it is estimated that printing and issuing a paper check will cost your business anywhere between 4 and 20 1 however the average fee per echeck transaction ranges from 0 30 to 1 50 2further there are multiple levels of authentication to help ensure funds are routed properly electronic checks also come with a lower risk of the associated funds being stolen as there is no tangible item to intercept direct deposit systemone of the more frequently used versions of the electronic check is the direct deposit system offered by many employers it is an electronic method of sending an employee s wages directly into the employee s bank account additionally taxpayers who are owed a refund on federal tax returns can elect to receive a directly deposited electronic check from the internal revenue service irs instead of having a physical paper check sent through the mail 3can anyone send an e check yes but you must first sign up for an e check service this can be done through your bank or a payment processor such as square stripe or paypal then you ll need to provide the payment details and authorize the payment can you send an e check instantly e checks are sent online instantly but processing them tends to take longer than other online payments done through apps because they are transferred using the automated clearing house ach network e checks can take several business days to clear 