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Alternative Payment Acceptance Services

Last week we discussed credit card processing without a merchant account. While credit cards are the preferred method for products and service purchase online, you’ll find that not everyone is completely comfortable with credit card purchasing - and some customers don’t own a credit card at all. So offering other methods for payment is an absolute must if you want to target all types of customers. Providing payment options for your shoppers also improves their trust in your company, and increases your credibility in the online space.

Let's take a look at some of the other payment acceptance services you can offer:

Online Checks & Debit Card Processing

Online checks (commonly called eChecks) are the equivalent of standard paper checks. The online equivalent doesn't require you to have a signed check from the recipient. This is perfectly legal. All you need is the information that appears on the customer's real-world checks.

There are two ways to accept online checks. The do-it-yourself method requires that you buy a program to print the checks. You then deposit them into the bank like any normal check. The big software programs in this category is Vcheck, and Intell-A-Check. Demand for this type of do-it-yourself online check processing is limited, as merchants have to wait several days to make sure that the check clears before they ship the order - another fraud prevention method. The better way to accept online checks is through a transaction service.

A transaction service verifies that the information on the online check is complete, and will even guarantee the check for an additional fee. What this means is that the transaction service will reimburse you if the check turns out to be invalid (and certain conditions have been met). These transaction companies charge a setup fee in addition to a per-check fee, and/or a percentage. One important thing to note is that most transaction companies only process US checks.

These programs allow you to accept checks by telephone and fax, as well as online. All you have to do is take the necessary check information and manually enter it into the program, then print out the check and deposit it at your local bank. Most check programs require you to buy special check paper on whcih to print your checks, and it's relatively cheap. In most cases you should be ok printing checks on your Inkjet or laser printer without requiring any special, expensive, magnetic-type ink, as many banks now use optical devices to process checks rather than magnetic ones. However, before investing in any check acceptance software, contact your local bank and make sure they will be able to accept the checks that you print off.

Another thing to consider is that some of the Gateway companies' Virtual Terminals can accept check transactions. The ones that do this also run a check verification against a national database of bad check writers, to reduce the incidence of returned checks. The better services will even re-submit returned checks automatically. If you use an online check transaction service, make sure that it includes the facility to verify the checks in real time. There's not much to processing a check online, so don’t pay high transaction fees, and avoid paying a discount (percentage) rate on check transactions, unless they're guaranteed! Also make sure you're informed about fund holds on check transactions, so you know when your funds will be available.

Here are a few more check resources you should consider:

• CheckMAN

• Checks by Fax

• CheckMatic

• XpressCheX

Debit card processing is almost exactly like processing a credit card, except that the order amount is deducted from the customer's checking account. For more details, including pricing information, contact a Merchant Account Provider.