E-Commerce Cubed Inc. is rolling out a new online check payment product--this one with a twist. While most e-checks are cleared through the automated clearinghouse system, E-Commerce Cubed’s eValuCheck is a paper check that a merchant’s payment processor prints and submits through the normal check clearing process.
Merchant banks benefit from the paper-based check because they can process it through their existing check systems and charge fees commensurate with check processing, which are usually higher than fees associated with ACH processing, says Chet Andrews, president of E-Commerce Cubed. Merchants benefit because consumers are more comfortable with the paper-oriented format than with an ACH format, he says, and because checks can be printed in a facility near the consumer’s bank and so be presented for payment faster than an ACH debit. “The U.S. has a very efficient system to process checks,” Andrews says.
Nevada State Bank has been selling eValuCheck services to merchants since December and has signed two merchants who are wrapping up tests, Andrews says. E-Commerce Cubed has six other institutions getting ready to roll it out to their merchants and is assembling a network of independent sales organizations to rep it to merchants. E-Commerce Cubed also has an arrangement with EDS to print checks in 40 data centers around the country. It has the ability to route the check to the data center nearest the customer’s bank, meaning that checks often can be presented for payment the day of the transaction, Andrews says.
As part of the roll-out, eValuCheck has been incorporated into the latest version of Miva Corp.’s e-commerce storefront software, as has the Debit-it ACH e-check product from AmeriNet Inc.
E-Commerce Cubed recommends a price of $1.50 an item for low-volume merchants who accept the eValuCheck with significant discounts as volume grows. The typical ACH processing fee is 5 to 10 cents, Andrews says. Banks can charge discount fees for guaranteeing a transaction, while a name, address or date-of-birth verification costs 25 to 50 cents.
Customers who wish to pay by paper check are transported automatically to an E-Commerce Cubed server, where they provide the pertinent information--name, address and MICR code at the bottom of the check. E-Commerce Cubed’s software sorts out the MICR code to determine bank number and checking account number. Customers then are sent back to the merchant’s site to complete the sale. Customers receive the canceled checks with their bank statements.
The product grew out of ValuTech Inc.’s managed disbursement program for corporations that determines the optimal location from which to issue checks.