Posted by NationalACH on Aug 19, 2015
high risk ACH

Accept Checks Online & Get More Sales

Ecigarette merchants add echecks as a payment option to get more orders from buyers that don't have cards, are maxed out on cards, or simply prefer to pay you  with with an electronic check.

It's simple.  The more payment options you offer, the more sales you will get.   Merchants report sales lifts of up to 20% when echecks are added on the checkout page.

How Echecks are Processed

Echecks electronically debit payments from your customers' bank accounts and credit the funds to your business bank account.

Echecks are processed either through the ACH network or via Check 21 technology that process the transactions through bank-to-bank file transfers.  The decision on which technology is best for you is based on the requirements of your business.

The user experience for both processing options is the same.  Buyers provide their bank routing and account numbers.  Transactions are cleared by the processor and cleared funds are deposited into your business bank account.

 Ecigarettes Surging Popularity

The popularity of e-cigarettes has surged since the the ban on smoking tobacco in public places has become the norm.   The notion that e-cigarettes are healthier than tobacco cigarettes and that they can assist in quitting smoking altogether has also contributed to the increased use of e-cigarettes.

E-cigarettes are loosely regulated and their benefits are frequently questioned by some medical professionals or regulatory bodies. In spite of these issues, there is a growing group of e-cigarette users who wish nothing else but to pursue their habit undisturbed.

Unfortunately, the e-cigarettes industry is undoubtedly headed toward more regulation, possibly similar to that applied to tobacco products.   Merchants, of course,  think increased regulation is unacceptable, as their products are clearly different from those based on tobacco.

The state of Indiana has already passed a piece of legislation demanding to get a license from the Indiana Alcohol and Tobacco Commission.

And, of course, it has become illegal to sell e-cigarette products to minors to curb the increasing number of teens that smoke e-cigarettes.

 eCigarette Payment Processing

The difficulty of enforcing the wildly diverse regulation and the conflation of e-cigarettes with tobacco products is has created challenges for online sellers.

Many merchant account companies classify e-cigarettes along with tobacco products.  In addition, there is the concern that minors who are not allowed to buy the product in the store will go online to buy.

As a result, online e-cigarette merchants who rely on electronic payments are hardest hit by the current attitude of regulatory bodies with respect to e-cigarettes.

Even though the evidence for the benefits of e-cigarettes over regular tobacco cigarettes is still mostly anecdotal, it is undeniable that the demand for these products has nowhere else to go but up.

Many payment processors are reluctant to accept e-cigarette sales and consider them high-risk merchant accounts. Companies classified as high risk merchants have to deal with inflexible policies that make online payments both difficult to get and expensive.


For customers that do not have cards or are unwilling to use cards for online transactions, alternative payments such as echecks give you another way to capture sales.    

Echecks are the most popular alternative payment method for US buyers.  Customers appreciate the convenience of having more than one way to pay for a purchase.  Millions of American shoppers regularly pay for goods & services with electronic checks.

Approval for an echeck account is much easier to obtain than for high risk credit card merchant accounts. Underwriting is more flexible since there are no card brands involved.

Are you an ecig merchant that wants to accept checks online?