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The United States is among the top targeted markets for global ecommerce. The easiest way for international companies to increase orders from US customers is to offer multiple payment options on the checkout page.
Electronic checks (echecks) are the most popular alternative payment method for US customers, second only to card payments. Echecks give you the ability to accept payments from customers that don't have cards, are maxed out on cards, or who simply prefer to pay with a echeck rather than a card.
An echeck payment automatically deducts the money from buyers' bank accounts. The funds are then electronically settled to your business bank account. Merchants offering echecks at checkout realize a sales "lift" of up to 30% simply by having an alternative to card payments.
Each market has its own peculiarities when it comes to electronic payments. In the US , card payments are used extensively, but their predominance is challenged by echeck payments.
One way of processing echecks is through the ACH network. ACH, which is an acronym for Automated Clearing House, uses a processing network which facilitates high-volume transfer of funds between an originator and a receiving depository financial institution.
This type of electronic payment is widely used for a wide variety of US transactions. It is one of the fastest growing payment options for internet sales. If you are selling online, you are missing sales if you do not offer echecks as a payment option to your US customers.
The smooth functioning of the network is regulated by NACHA, the National Automated Clearing House Association. Since its creation in 1974, NACHA has gone a long way to reach its current processing capacity of over 20% of the electronic payments in the United States. This share of the market will surely increase, as NACHA has distinguished itself through innovation and its ability to respond to the necessities of businesses and consumers alike. The most recent improvement of the ACH payment process will soon introduce faster, same-day settlement for all transactions that will take place within the network.
Echecks can also be processed via Check 21 technology, which allows for fast clearing and settlements of funds. And is not restricted by NACHA rules regarding chargebacks and returns. Processing echeck transactions using Check 21 technology is particularly valuable for high risk or high volume merchants.
The popularity of echeck payments is fueled mostly by what distinguishes them from card payments. From the perspective of the consumer, the fact that card information is not needed is extremely convenient. Fraud involving credit cards is so high in the United States, that some people have become reluctant to use or even own this payment instrument.
Merchants, especially high risk ones, will find echeck payments beneficial for their business because they are frequently easier to get and less costly compared with the strictly regulated credit card payments. In addition, the relatively short period in which an echeck transaction can be disputed with the bank means that you will have to deal with a smaller number of spurious chargeback claims from customers. Also, echeck payments provide high authorization rates for recurring billing because the account information is more stable than the credit card information.
What is clear is that echeck payments will remain an essential component of the electronic payment environment in the United States. As a result, if you wish that wish to tap into the local market, you have to compete with other merchants that have already implemented echecks payments. In order to stay profitable, gain an edge over your competition and expand your US customer base, add echecks to your payment page today.
NationalACH offers international merchants the opportunity to gain all the benefits echecks provide. The profits of your business will immediately increase. And you will maintain long-term profitability by adapting to the payment needs of the US markets.
NationalACH is one of the only firms that offer echecks to international merchants. If you are serious about increasing your US market share, contact us today.