Different types of electronic payments: - E checks, EFT Payments and ACH Processing

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April 2, 2009

With the rapid advancement of technology today it is a lot easier to use Electronic check processing or eChecks instead of paper checks. By using these electronic checks individuals and businesses alike have the opportunity to quickly and conveniently collect money from a bank account electronically. eChecks also help reduce the operating costs of businesses as the monthly costs incurred by businesses for their paper checks are completely eradicated. Electronic funds transfer or EFT payment is the method of using computer based systems to execute financial transactions electronically online. Electronic fund transfer process can be instigated by a card holder when he?d like to make payment for a credit or debit card.

This kind of EFT payment is used either at an automated teller machine (ATM) or at a point of sale (POS) or at situations like mail order, telephone order or internet purchases. The Automated Clearing House (ACH) Network is used to clear E checks. With the help of ACH Processing businesses can collect information on a paper check and then electronically collect the money at a bank. This is a secure payment network that is used for direct deposits and direct payments. ACH Processing is an online processing option where a banking network that is a federally regulated system is allowed to send and receive money.

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