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What’s the difference between eChecks and Credit Card Payments?
Electronic payments have revolutionized the way people shop, do business, and operate in their day-to-day lives. With this new and simplified method of global payment comes various options for transferring funds. Two common ways for making payments are eChecks and credit card payments. In this article, we’ll cover everything you need to know about how each of these payment methods works and the benefits of each.
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What is an eCheck?
An eCheck is precisely like a traditional paper check – it just exists online instead of on paper. With eChecks, money moves from the payer’s checking account and, after passing through the ACH electronic payment network, is deposited directly into the seller’s account. Before going any further, let’s define what the “ACH network” is and how it works:
The Automated Clearing House Network processes electronic financial transactions across the United States. The ACH electronic payment system facilitates payroll, tax payments, tax refunds, and direct deposit transactions. The ACH network is a financial hub that helps individuals and businesses move their funds between bank accounts.
Now that we understand what the ACH Network is, let’s explore the benefits of using eChecks:
- Using eChecks saves money by avoiding processing and utility fees for things like envelopes, paper, and postage stamps
- This type of payment allows for more safe and secure payments
- eChecks give ultimate flexibility by allowing users to pay from anywhere at any time of day
- eChecks speed up the process of making payments and getting paid
- Using eChecks allows users to have greater control over their finances
What is a credit card payment?
Like most people, you probably make most payments by tapping a thin plastic credit card onto a payment screen. Each time you use the card, you borrow money from the credit card issuer. This money shows up as a “balance” on the credit card statement and must be paid back by a specific date every month. The credit card issuer provides the user with a particular card of limit.
What are the benefits of credit card payments?
- Signing on with a new credit company often means getting a big, one-time bonus – this can be a financial bonus or in the form of other rewards
- Most credit companies provide an ongoing rewards system – the more you pay, the more points you collect towards payments like gasoline, groceries, or transportation services
- Paying with a credit card is one of the safest forms of electronic transactions, as all financial movement is tracked, monitored, and recorded
Choosing the correct type of digital payment to suit your needs and budget can be challenging in today’s day and age. The options are endless and constantly evolving.
Contact us at Kapital Solutions to learn more about choosing suitable payment methods for your business. Get in touch with our Kapcharge expert team today!
Looking for eChecks or Credit Card Payment Processing?
