Home » High-Risk eCheck Payment Processing

For high-risk businesses, the number of default options for accepting payments online is limited. These merchants often have no access to the most popular payment methods, making high-risk echeck processing a very appealing option. 

In general, eChecks are the most common payment method after debit and credit cards for high-risk businesses. They are popular with customers because of their convenience, and merchants like them because of the higher tolerance for chargebacks and returns. If you are looking for a high-risk eCheck gateway and merchant account, you can apply today at SecureGlobalPay.

Otherwise, continue reading this article and learn how high-risk echeck processing works, what the advantages are, and whether or not it is the right choice for your business.

What is a high-risk eCheck?

A high-risk eCheck is an electronic check payment method used by businesses that operate in industries labeled as high-risk by banks and payment processors. Because of the perceived risk, traditional payment processors are often hesitant to work with these businesses.

Key characteristics of high-risk eChecks include:

• Increased scrutiny: High-risk eChecks may undergo more rigorous verification processes due to the higher perceived chance of fraud or chargebacks.
• Higher fees: Processing high-risk eChecks can come with higher transaction fees compared to standard eChecks, reflecting the added risk for the payment processor.
• Specialized processors: Not all payment processors handle high-risk eChecks. Merchants often need to work with providers like SecureGlobalPay that specialize in high-risk industries.

In summary, a high-risk eCheck is a payment solution tailored for businesses in industries deemed risky, enabling them to accept bank transfers despite the challenges associated with their niche.

What is a high-risk eCheck gateway?

A high-risk eCheck gateway is a payment processing service that allows high-risk merchants to handle electronic check transactions. This gateway acts as the intermediary between the merchant’s website and the banking system, ensuring that eCheck payments are processed securely and efficiently.

For high-risk merchants, a standard payment gateway may not be sufficient due to the nature of their business, which could lead to higher instances of fraud, chargebacks, or other financial risks. 

A high-risk eCheck gateway is specifically built to manage these concerns. Key features include:

• Fraud prevention tools: To minimize the risk of fraudulent transactions, high-risk eCheck gateways come equipped with advanced fraud detection systems, such as real-time monitoring, IP tracking, and identity verification processes.
• Chargeback management: Since high-risk businesses are more prone to chargebacks, these gateways provide tools to help manage and reduce chargeback occurrences. This can include dispute resolution support and chargeback alerts.
• Flexible payment options: High-risk eCheck gateways typically support various payment methods, including recurring payments, installment plans, and one-time transactions, providing flexibility for both merchants and customers.
• Customized solutions: These gateways are tailored to meet the specific needs of high-risk businesses, offering personalized service and support to ensure seamless payment processing.

In essence, a high-risk eCheck gateway provides the infrastructure and protections necessary to handle the unique challenges of operating in a high-risk industry. It allows businesses to focus on growth without constantly worrying about payment issues.

How does high-risk eCheck processing work?

When a customer wants to pay you with an eCheck, all they do is enter their bank routing number, account number, and account name. The money is removed from the account but does not leave the bank until it is settled. 

The customer’s bank holds the funds for a few days. Once cleared, the money will be credited to your business bank account. The entire process takes two to three days. An eCheck is similar to a paper check, except it is sent online to your bank.

What are the fees involved?

High-risk eCheck processing typically comes with higher fees than standard eCheck processing due to the increased risk associated with high-risk industries. These fees can include:

• Percentage rates: A percentage of each transaction is charged by the payment processor.
• Per-transaction fees: A flat fee might be applied for each eCheck processed.
• Monthly fees: Some processors charge a monthly fee for access to the eCheck gateway and additional services.
• Chargeback fees: High-risk businesses may also face chargeback fees, which are costs incurred when a customer disputes a transaction.

The final rates and fees will always depend on the type of business, the volume processed, the size of the transaction, and various other risk factors. Reach out to a SecureGlobalPay representative to help you better understand what rates you will be paying. 

Ways to accept eCheck payments

High-risk merchants can accept eCheck payments in several ways:

• Online payment forms: Customers can enter their bank details directly on the merchant’s website using a secure form.
• Recurring payments: This option is ideal for subscription-based businesses, allowing merchants to automatically withdraw funds on a scheduled basis.
• Phone orders: For call centers and similar businesses seeking to accept electronic check payments, we also offer the Pay by Phone eCheck facility.  Customers can provide their bank details over the phone, and the merchant processes the payment manually through our Pay by Phone virtual terminal.
• Mail orders: Customers can submit their bank details via mail order forms, which the merchant then manually enters into the eCheck processing system. Alternatively, you can send customers a payment link via email that opens the eCheck payment page where they can enter transaction details. 
• Face-to-face transactions: In physical locations, customers can provide their bank information directly, allowing merchants to process the payment on-site through the virtual terminal. This option is popular among businesses that go to trade shows, HVAC, contractors, wholesale, equipment rental, event management sectors, and similar.

For reference, SecureGlobalPay’s payment gateway seamlessly connects to WooCommerce, Shopify, BigCommerce, and dozens of other shopping carts. 

How to apply for a high-risk eCheck processing

Getting a high-risk eCheck merchant account approved is fairly straightforward. You need to submit relevant documents, fill in the requested info, and wait for the decision.

Here is a more detailed breakdown if you need help navigating the process:

1. Research payment processors: Start by identifying payment processors that specialize in high-risk industries. Look for those that offer high-risk eCheck services and have a good track record.
2. Prepare your business information: Before applying, it’s not a bad idea to gather all the necessary documentation about your business. This typically includes your business license, tax ID, bank statements, and details about your products or services. Some processors may also request a business plan or financial projections, especially if you’re a new business.
3. Complete the application: Once you’ve selected a high-risk payment processor, you’ll need to fill out their application form. Be prepared to provide detailed information about your business, including the nature of your industry, your processing history, and your expected transaction volume.
4. Underwriting and review: After submitting your application, the payment processor will conduct a thorough review of your business. This process, known as underwriting, helps them assess the level of risk associated with your account. They will look at factors like your business’s financial health, credit history, and chargeback rates.
5. Provide additional information if needed: During the underwriting process, the payment processor might request additional information. This could include details about your chargeback management strategies, customer service policies, or evidence of previous payment processing history.
6. Approval and integration: If your application is approved, the payment processor will set up your high-risk eCheck gateway. This includes integrating the gateway with your website or point-of-sale system, ensuring that you can start accepting eCheck payments as soon as possible.

Additional benefits of having a high-risk eCheck gateway

A high-risk eCheck gateway can significantly impact your business operations and revenue. Here are some additional benefits we didn’t have a chance to mention yet:

• Higher tolerance for chargebacks: ACH payments allow only a 0.5% chargeback rate. Card payment processors tolerate below a 1% chargeback rate. ECheck processing gateways can allow for up to 10% chargeback rates with high volumes of transactions.
• Increase your customer base: In general, more payment options means more customers. ECheck is an alternative option for customers who don’t want to use their cards.
• Lower processing costs: EChecks often come with lower processing fees than credit card transactions. For high-risk merchants dealing with slim margins or high transaction volumes, these savings can add up significantly over time.
• Reduced chargeback risk: ECheck transactions are less prone to chargebacks compared to credit card payments. This is because disputes involving eChecks often require more concrete evidence and are typically resolved through bank processes, reducing the chances of losing revenue due to chargebacks.
• Access to specialized support: Working with a provider that understands the challenges of high-risk industries means you get access to specialized customer support. This can be invaluable when dealing with complex payment issues or navigating regulatory requirements.
• Global reach: Many high-risk eCheck gateways offer the ability to process international transactions. This can open up new markets for your business, allowing you to serve customers across borders without the limitations often imposed by traditional payment processors.
• Compliance with industry standards: High-risk eCheck gateways ensure that your payment processing is compliant with the regulations governing your industry. This can help avoid potential legal issues and penalties, giving you peace of mind as you focus on growing your business.

In summary, a high-risk eCheck gateway not only helps you securely process payments but also offers strategic advantages.

Simplify payment processing with SecureGlobalPay

SecureGlobalPay (SGP) is a leading provider of payment processing solutions, specializing in serving high-risk businesses. Whether you need a high-risk eCheck gateway, a complete payment processing solution, or are just looking for a high-risk merchant account, we’ve got your back.

Why choose SecureGlobalPay?

• Expertise in high-risk industries: We have over 20 years of experience working with high-risk businesses. We understand the unique challenges and know how to provide solutions that work.
• Security and compliance: SecureGlobalPay prioritizes security, with advanced fraud prevention measures and strict compliance with industry regulations.
• Personalized Support: With a phone, email, and live chat, you get dedicated support to help you navigate the complexities of high-risk payment processing.
• Flexible solutions: Whether you’re looking for eCheck processing, credit card acceptance, or international payments, we can provide customizable solutions to fit your business needs.

Contact us today to learn more about how we can support your business and help you succeed in a high-risk environment. Or, if you’re ready to get started, go straight to our merchant application form.