Posted by NationalACH on Sep 24, 2013
Checks by Phone, High Risk, Processing, Check 21

Get More Orders with Checks by Phone

Many high risk merchants sell through call centers. The more ways customers can pay you, the more sales you make.

When you accept checks by phone you rescue orders that otherwise would be lost.

  • Get orders from customers who don't have cards or are maxed out on cards.  
  • If a card is declined, electronic checks give customers another way to pay you.

How Echecks Work

Echecks are a familar and trusted payment option.  Millions of Americans regularly pay for goods & services with electronic checks.  

Taking a check by phone order for a payment via electronic check is similar to taking a card order.  The customer provides bank routing and account numbers rather than card data.  Orders are submitted through a virtual terminal.

Payment is debited from the the buyers bank account.  And automatically deposited into your bank account.

ACH Processing vs. Echecks

A check by phone order can be processed through the ACH network or via echecks using Check 21 technology.  The choice of which to use depending upon the specific needs of the business.

NACHA, the governing body for the ACH network, recently changed rules regarding revokes (chargebacks) and returns.  Chargebacks can now be no more than 0.5%.  And returns must be less than 15%.

Many high risk merchants find it challenging to comply with these rules. Therefore, echecks are the solution of choice.

Echecks are processed through bank-to-bank data exchange rather than through the ACH network.  As a result, high risk merchants have far greater flexibility on chargebacks & returns with echecks rather than ACH  processing.    

Extra Protection for Check by Phone Transactions

Check by phone accounts have 3 levels of verification to protect high risk merchants.  Accounts include the following verification services which reduce chargebacks on accounts up to 80%.

  • ATM verification (also known as Early Warning) verifies the account is in good standing and that there is money available in the account
  • NCN verification verifies that there has been no history of bad checks written on the account
  • Live verification verifies by phone call to the consumer’s bank that money is still available in the account before the transaction is processed.

Echecks Better than Cards in Preventing Chargebacks

It is far more difficult for buyers to chargeback an echeck transaction than a card payment.

To chargeback an echeck transaction, consumers have to supply documentation to their bank. And may be required to visit the bank in person. Some banks also require consumers to sign an affidavit. And consumers have only 40 days to initiate a chargeback.  

Few buyers are willing to invest the time & effort in disputing the payment, esp. for smaller ticket items.

Disputing a card payment is much easier.  All it takes is a phone call to the card issuing bank. And most banks favor their customers over you.

In addition, card transactions can be charged back for up to 180 days after the payment. Exposing you to substantially greater risk for contingent liabilities than with echeck transactions.   


Echecks are the most popular alternative payment method for US shoppers. Accepting check by phone payments gets you more sales.  

Electronic check processing is convenient for customers.  And profitable for you.

Are you a high risk merchant interested in increasing orders with an echeck account?

Contact today