July 30, 2003, 12:00 AM

Payments Processing

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In addition, some consumers just prefer to pay by check or cash, perhaps as a cash flow management tool. In fact, Kerlin cites a high-end golf equipment retailer that receives hundreds of check payments a week. Its customers must have credit cards, but checks or e-checks are the preferred payment option for many of them. “Merchants are more accepting of the concept that there are a lot of people who can spend and buy a lot but who don’t have a credit card,” Kerlin says.

AmeriNet’s customers can choose between check guarantee that allows them to ship an order immediately or waiting until the check clears, usually a week, before shipping. 95% of customers opt for waiting for the check to clear because of the higher price that they must pay for the guarantee that allows immediate shipment, Kerlin says. “Most merchants don’t need to ship right away,” he says, “and customers accept that because the merchant tells them upfront on the screen in the case of DRTV or in the order process for Internet merchants.”

Comfort with e-checks

The trend toward e-check payments will only continue, Kerlin says. “People are so used to having their paychecks pushed to them electronically and then having the money taken out electronically for their mortgage or car payment, or even their cable bill, that they are very comfortable with the idea of paying merchants by e-check,” he says.

Among the promotions that card companies have undertaken to improve their market share, MasterCard has offered $100 on a pre-paid debit card to travelers who book cruises with Travelocity and pay with a MasterCard card and American Express has promoted discounts at Target.com and Fields.com. American Express also has offered discounts to Midwest Airlines customers who pay with an American Express card.

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