How to Accept Electronic Checks

check and pen in close up image by Alexey Klementiev from

Electronic checks serve dual purposes in the economy: They allow businesses to convert paper checks for maximum ease, and they provide consumers with another payment option for online shopping. This process rapidly moves money from a customer’s account to a merchant without physically going to a bank. Electronic check transactions are encrypted for information security and facilitated by the Automated Clearing House (ACH). Here is how you can begin to accept electronic checks for your business.

Locate an electronic check processing company that is established within the market. This is important for minimizing the risk to your business. Examples include, a company with free customer support that specializes in Internet-based companies; DowCommerce, an electronic check processor that ensures secure Internet Protocol transactions; and ITI Internet Services, which charges flat, per-transaction fees that decrease with volume.

Complete a merchant account application with the chosen processing company. Many processors, such as the ones listed above, offer the application online for faster review. Routine information is generally requested, including personal data from the owner(s), company information and the corresponding bank account number. The processor will deposit funds into and withdraw fees from that account.

Some processors, such as ITI Internet Services, also charge a one-time sign-up fee to establish a new account. Others, such as DowCommerce, provide their applications free of charge. Once your application is accepted, you will be assigned an account identification number from the processor, which will likely be used in many of your transactions.

Install the necessary hardware and/or software provided by the processing company. Retailers with both brick-and-mortar outlets and e-commerce sites will likely install hardware and software components, whereas businesses with only an Internet presence will install software.

The hardware is generally for companies that want to convert traditional checks into electronic payments. In this instance, businesses receive a paper check payment and run it through an electronic scanner system. The funds are then transferred from the customer’s account and into the business account.

Some processors can be accessed simply by inserting HTML links, buttons or forms on an e-commerce payment site. Another method is to include a link in an e-mail to customers, who can in turn pay directly to the processing company. ITI Internet Services offers these options, as well as the ability to make links and buttons that use its built-in shopping cart. These options can be discussed with a customer support specialist, who will help you choose what is best for your needs.

Learn about the individual processing times specified by the company you select. Some processing companies end their days on Pacific Standard Time, while others end on Eastern Standard Time. This is important for knowing when funds will be settled into your bank account.

Let customers know that you accept electronic check payments. Businesses that intend to convert standard bank checks into electronic checks are obligated under U.S. federal law to visibly post this information and provide customers with a copy of the notification. Customers must also be presented with a telephone number if they want to request additional information about electronic check conversion.


  • One way to overcome the hurdle of whether customers have funds in their checking accounts is to employ electronic verification tools. These can complement your electronic check system.



About the Author

Jean Miller has been writing since 2008. As a freelance writer, she has developed website content, press releases and newsletters for a variety of clients. Miller holds a Bachelor of Business Administration in human resource management from Cleary University.

Photo Credits

  • check and pen in close up image by Alexey Klementiev from