1. Resource Library
  2. AR Automation
  3. Check Processing

What Are eChecks? 6 Benefits of Accepting eChecks for B2B Businesses

Published on 6 min read

In this article, we’ll:

  • Break down exactly how eChecks work

  • Share some of the ways eChecks benefit B2B businesses

  • Explain how you can support eChecks acceptance within your existing accounting systems

AR professional sitting on a stack of coins, looking at an eCheck on their mobile device

Looking for a fast and easy way to offer your customers payment flexibility, reduce error-prone manual processes, accelerate cash flow, and improve Days Sales Outstanding (DSO)? Consider accepting eCheck payments.

Electronic checks have come a long way since they made their first appearance in 1998. (Fun fact: the very first eCheck was issued by the US government to a contractor for an Air Force project in the amount of $32,000.) But this convenient payment method has remained steadfast in its simplicity and efficiency.

Faster than a paper check, cheaper than a credit card, and easier to set up than wire transfers and corporate trade exchanges, the eCheck is a great way to enhance your customers’ experience with convenience and modernize your accounts receivable (AR) processes.

What is an eCheck?

An eCheck, or electronic check, is a paper check transformed into a digital form of payment. The same information found on your customer’s paper check (i.e., their business name, bank account number, and bank routing number) is used to transfer a payment from their bank to yours, digitally.

What’s the difference between an eCheck, EFT, and ACH?

When first learning about eChecks, it’s easy to get confused about how they relate to an electronic fund transfer (EFT) and Automated Clearing House (ACH) transaction. In fact, these three terms are part of the same process. Here’s how they intersect:

Electronic Funds Transfer (EFT)

An EFT is a general term that refers to any type of electronic transfer of funds from one bank account to another. EFTs are sent through computer-based systems and require no direct intervention from bank personnel. An EFT could be anything from a direct deposit, to a wire transfer, to an ACH, to an eCheck.

Automated Clearing House (ACH)

An ACH payment is a type of EFT available in the US to move funds from one bank to another. It’s a popular way for businesses to pay one another or for a business to pay a contractor or vendor. These payments are managed by the National Automated Clearing House Association (NACHA), a non-profit electronic network that operates under the Federal Reserve.


An eCheck is a type of EFT that uses the ACH network to process a payment or funds transfer. Just like a paper check, the money is withdrawn from the buyer’s bank account and transferred to the seller’s bank account. The difference is that everything is done electronically.

How does eCheck payment processing work?

Processing payments by eCheck is faster than processing payments made via traditional paper checks because you can skip the printing, envelope filling, mailing, travel, and processing time. The eCheck payment processing flow looks like this:

1. Gather authorization from your customer

You will need your customer’s authorization to transfer funds from their account, using the same information found on a paper check (company name, bank account number, bank routing information, and a dollar amount). This can be done via a paper or online form.

2. Transfer the funds through the ACH network

Once you have the required information to process the payment, you can send it through the ACH network. To accept an eCheck payment, businesses must have an ACH merchant account (which can be supplied via your payment services provider).

3. Receive funds from the buyer’s financial institution

Within 24 to 48 hours, you should receive confirmation that the transaction has been approved. It may take three to six business days for the payment to make its way to your company’s bank account.

Common questions about eChecks

Are you wondering if eCheck payments are a fit for your business? Here are some of the most popular questions about eChecks, answered:

Can eChecks be used for recurring payments?

Yes—eChecks are convenient for recurring payments like commercial or residential rent, SaaS subscriptions, or other regular ecommerce transactions. Your customer would fill out an authorization form once and the payments would come out on predetermined dates.

Can eChecks be processed on weekends?

No. The eCheck process involves financial institutions, which typically operate on business days only. If your customer issues an eCheck payment on a Monday, it will likely be authorized by Wednesday or Thursday, but the funds won’t reach your bank account until early the following week.

Can eChecks be canceled?

Yes. You and/or your customer can cancel an incoming eCheck payment depending on which stage of the process it’s in. If the funds are already en route to your bank account, you may have to issue a refund. Your payment processing provider should be able to support you with this.

What happens if an eCheck bounces?

If your customer has insufficient funds in their bank account, their eCheck payment will indeed bounce just like a paper check would. It’s up to you to decide whether you levy non-sufficient funds (NSF) charges for bounced eChecks.

6 benefits of accepting eCheck payments for B2B businesses

There are several business benefits to accepting eChecks, including:

1. Increased efficiency

If many of your customers make recurring payments, eChecks will reduce your team’s manual labor involved with processing paper checks. Your AR staff can then turn their attention to more high-value, strategic work.

2. Accelerated cash flow

Businesses that accept eChecks can capture more revenue by making it easy for customers to quickly pay their invoices. With payments coming in faster, you’ll be able to close receivables and access your cash faster.

3. Better customer experience

Busy accounts payable departments appreciate a convenient payment experience that requires less time and effort from their team. With an advanced AR automation solution, your customers can enter their payment information into a digital wallet saved in the cloud, eliminating the need for them to re-enter payment details.

4. Fewer unpaid invoices

“The check is in the mail” isn’t a viable excuse for a late payment with eChecks. And when you accept eChecks through an AR automation platform that integrates with your enterprise resource planning (ERP) system, you’ll be able to see the payment status and automate your cash application process. You can count on the correct invoice being applied to the correct customer account 100% of the time – and automatically posted back to your ERP.

5. Lower fees than paper checks and credit cards

Bank of America reports that it costs between $4 and $20 on average to process a paper check. Credit card processing fees can be between 1.3% and 3.5% of each transaction. The cost of an eCheck is closer to $0.10 per transaction.

6. More secure method of payment

eChecks can offer peace of mind for both the buyer and seller. Data encryption protects confidential banking information and their digital nature means there’s no physical element of the transaction, which protects against fraud and identity theft. And when they’re facilitated through an AR automation platform with payment processing built-in, you can be assured that the data is all contained within one environment. No third-party risks.

Versapay can help you accept eChecks

To take advantage of the many benefits of accepting eChecks, you’ll need a payment processing partner like Versapay to process this form of digital payment over the ACH network.

In addition to facilitating eCheck payments, Versapay seamlessly integrates with your ERP. We help you capture any type of payment from your ecommerce, point of sale, and accounts receivable channels. And when your customers make payments within Versapay, the remittance information is automatically posted to your ERP with the payment, saving your AR team the trouble of matching payments with invoices.

When you offer your customers the convenience of paying by eCheck, you’re also giving yourself the gift of more efficient AR processes, better cash flow, and fewer unpaid invoices. It’s an accounting upgrade that will pay off long into the future.

Want to see what accepting eChecks looks like in Versapay? Request a demo here.

Check Processing

What you need to know about streamlining your check processing.

Always stay up-to-date

Join the 50,000 accounts receivable professionals already getting our insights, best practices, and stories every month