What is An Electronic Check What is An Electronic Check

What is An Electronic Check and How Does It Work? [2021]

Are you worried about paying electronic checks? The main concern of this article is about what is an electronic check? It is the latest technology for transferring payments. That’s why many people are unaware of it. Are you one of them? Don’t worry. We have your back.

If you are a business owner and want to expand your business, you should be aware of all types of funds transfers. It would be for the convenience of your customers which will attract them towards your services. Excellent service providers often earn more clients.

Besides knowing what an e-check is, you should also be aware of its pros and cons and how to use e-checks. In this article, we compiled a list of all the essential aspects of the electronic check. If you are entirely unaware of the e-checks, just read the article thoroughly.

What is An Electronic Check?

As the name represents, E-check or electronic check is something done electronically with no manual tasks. An electronic check is an advanced form of a paper check. In older days, people preferred paper checks when e-checks were not in the market.

With the advancement of science and technology, fake people also upgraded their frauds, and paper checks are no safer. To counter the deception of such humbugs, banks introduced e-checks. Now you can transfer money more safely and quickly without any manual work.

The reason behind the safe and quick working of e-checks is that they are encrypted and require authentication. To transfer funds, you have to prove that you’re the owner of the account. Encrypted transfers mean no one else would know about your money transfers.

How Does It Work?

If you are hearing the term e-checks for the first time, you must be interested in its action process. Sometimes, we face people who know how to use e-checks but don’t know how it works. If you are using something, you must understand how it works and what its principle is.

The working principle of e-checks is almost similar to paper checks. However, it is an online process much faster and efficient as compared to paper checks. The steps that a payee should follow to get his e-check are as follows.

Requesting Authorization

As we mentioned above, the transfer requires authentication. Here it is, in the first step. If you are the payee, you have to send an online request to your payer to get an e-check.

Selecting the Amount of Money

In the next step, the payer will select the amount of money he wants to pay you. Once the payer authorizes you a specific amount of money, the process will start.

Finalizing the Payment

Before the ACH process starts, the payer has to finalize the payment by entering all the details. As the payer submits the information, the ACH process will start automatically.

Funds Transfer

As soon as the payer finalizes everything, the ACH transaction transfers the fund from the payer’s account. The payer also gets a transfer receipt, and the payee receives his money. 3-5 business days are enough for all this process.

How Do I Get Paid Through An Electronic Check?

Let suppose you are a payee who has to receive money from an electronic check. The process through which money travels to your account is straightforward. You will send the payer an online transaction form. Now, the payer has to work to complete the transaction.

The payer will enter your account number and the routing number into the form. Once he enters all the details and submits the form, you will receive payment in your bank account. The ACH network works as a medium for this transfer of money.

We can say that the payment from the payer’s account has to enter the ACH network for the successful transfer. Then the amount gets to your (payees) bank from where it is transferred to your account.

Why Should I Use the Electronic Check Payment Option?

There are several reasons you should use the electronic check option instead of a paper check. The primary reason is that nowadays, many advanced entrepreneurs use this payment method to transfer funds.

Moreover, we know that it is the safest method to transfer funds successfully. Through e-check, you can send and receive money without any third party involved in the process. An electronic check makes the transaction and your account details safe and secure.

Benefits of Using the Electronic Check Payment Option

Though electronic check has many advantages over paper check, we will discuss only a few of them. Let dive into the details of the benefits of using an electronic check for online payments.

Less Time

E-checks are much faster than paper checks. It is because the whole process is online. You don’t have to go to a specific location for the transfer of money. Just open the app at your home and make the transfer.


Besides being faster, e-checks are also the safest to transfer money. The system only allows access to the account after the authentication of the user. So, if you are using e-checks, you don’t have to worry about the safety of your money.

Less Fee Per Transaction

The per-transaction fee of e-checks is much lesser than other methods of sending money. If you receive recurring payments, you must use e-checks to save your balance. E-checks can save a considerable amount of money if you have to make regular payments.

Automatic Payments

If you are an employer, you can set an automatic payment system for your employees. It would be convenient for you and the employee. Also, the payment will be on time and encrypted so no one else would know about it.

Disadvantages of Using the Electronic Check Payment Option

E-checks have several advantages that make them the top priority of most entrepreneurs, but they have some drawbacks. Let’s check the disadvantages of e-checks which you should keep in mind before going for e-checks.

Not Suitable for Offline Sales

If you are selling something offline or want to buy something, you can’t pay for it through e-checks. There you have to pay money in cash.

Risk of Cyber Attacks

Nowadays, some cybercriminals can hack even the safest computer system. So hacking your bank account would not be a problem for them if you use e-checks unsafely. Beware that you don’t share any single detail of your account with anyone.

Technical Problems

We know that online systems often go down due to technical problems. So it is better that you have an alternate plan of paying money in case of any technical issue.

How Can This Help Me in My Personal Life or Business?

Using e-checks affect your personal life in a very positive way. E-checks can save your precious time and money. Moreover, you can also get familiar with a unique way of sending money. E-checks do not expose your bank account details to anyone except you.

Frequently Asked Questions (FAQs)

Is an electronic check the same as a regular check?

No, it’s not. A regular check or a paper check is a manual process, while an e-check is an online process. Paper checks are not much safer and quicker as compared to e-checks. Though the process is almost the same, there is a difference in the speed of both methods.

How long does an electronic check take?

An electronic check is much faster and efficient than a regular or a paper check. Transferring funds through an electronic check may take 3 to 5 business days. It may take longer if the payer is lazy and takes time to enter the details into the system.

Do electronic checks go through immediately?

No, it takes some time to transfer money from the payer’s account to the payee’s account. Once the payee enters all the details into the ACH network, he will receive a receipt. After that, it may take 3 to 5 business days to transfer the funds.

Is paying by electronic check safe?

As long as you keep your account details secret, all your fund transfers are safe. The electronic check uses an authentication system to recognize the user before giving him access to the account. As compared to paper checks, e-checks are much safer because they are encrypted.

What is e-check payment?

An e-check payment is an advanced form of the paper check used in older days. It is much faster and quicker than paper checks because they are encrypted. It uses an authentication system to recognize the user before making any fund transfer.

Does Wells Fargo do e-checks?

Yes, Wells Fargo does e-checks. You can indeed make funds transfer through Wells Fargo but remember that you should have enough money in your account. It is because you can not get approval before you send the money to the bank.

How do you write an electronic check?

You cannot write an electronic check. It is an online process where the payer has to enter the payee’s details into his account. After entering the information, the payer must submit the online form to enter the payee’s account details.

Once the payer submits the form, the ACH network comes into action. It might take the ACH system a few days to transfer funds from the payer’s account to the payee’s account.

Final Words

The above article was entirely about “what is an electronic check” and how to use it. After reading the article thoroughly, you will know the advantages and disadvantages of using e-checks. We also discussed the use of e-checks in the daily life of an entrepreneur.

If you are a businessman who mainly faces recurring funds transfers, we recommend you use e-checks. E-checks charge less money per transfer as compared to paper checks and other sources of money transfer.

Also, we would recommend using e-checks instead of paper checks for entrepreneurs who deal with massive amounts. The reason for our recommendation is that the e-checks are encrypted and provide a safer way to transfer funds.

We tried our best to answer all the questions of people who are unfamiliar with e-checks. Still, if you have some doubt, you can freely ask us in the comment section. Also, you can share your experience with us in the comment section.