What is electronic funds transfer (EFT) processing?

EBT, or electronic funds transfer, is a computerized system that performs financial transactions electronically without any paper money being sent from one bank to another. The use of electronic funds transfer has become more widespread with the personal computers, improved networking systems, and security features such as encryption. EFT processing is the process of transferring funds initiated by electronic means including ATMs, computers, telephones, point of sale systems, and other electronic terminals. Electronic finds transfers may also be referred to as automatic bill payment, automatic debit, electronic bill payment, or direct debit/deposit. Most users of EBT processing find it safe, efficient, and less expensive than using traditional paper checks. In fact, many institutions such as banks offer lower interest rates on loans or free services if customers use ACH/EFT processing.

What type of transactions can be handled by EBT payments?

EBT payments can be used for both debit and credit transactions. The following transactions can be executed by electronic funds transfer: sale, withdrawal, refund, cash back, deposit, payment, and inquiry. According to NACHA, 43 percent of all U.S. households use ACH/EFT payments for at least one recurring payment per month. In addition, 84 percent of ACH/EFT payment users say they are very satisfied with using EBT/ACH.

How are EBT or electronic payment services transactions authorized?

There are many security protocols in place to ensure that electronic payment services are secure. An electronic funds transfer goes through several security procedures throughout its transfer through the network ensuring that the whole process is legitimate and legal. Card holders typically are required to provide their signature as a form of authentication, and sometimes a personal identification number (PIN) may be used. Other means of authentication involve using a credit card stripe reader to read the card's magnetic data. Data is sent to be authorized using encryption to maintain the integrity of the inquiry for electronic payment services. For transactions where a network connection is not available, electronic payment services can be authorized offline. There may be higher rates involved, since the security risks are greater. Some security measures taken include checking to make sure the card number is not on a list of “hot cards,” which is a list of known stolen credit cards, limiting the number of offline transactions, and random online authorization.

Reference: http://www.ebtprocessing.com/

The Top 10 Benefits of Accepting Credit Cards

1. Accepting credit cards will often double… even triple your current sales. Studies show businesses that accept credit cards can see a huge increase in volume… almost overnight.

2. It will legitimize your business. Studies show that when you display credit card logos as forms of payment you accept, these logos create a sense of ‘trust’ in your customers mind, and if they trust you, your customers will buy from you.

3. A merchant account improves cash flow. Accepting cards has a huge positive effect on business cash flow. Even if sales don’t increase (and they almost always do) your business will benefit by having the money from the credit card sale instantly delivered to your bank account. No more waiting for check to clear, or sending out time consuming invoices, waiting for payment. With credit cards you get your money from your customers quickly and easily.

4. Over 90% of web purchases are made using credit cards. If you are selling ANYTHING on the web and you are not accepting credit cards, you are eliminating 90% of your potential buyers.

5. Grabs Impulse buyers. Credit card holders buy more on impulse, are more affluent, and buy 2.5 times more merchandise than non-card holders.

6. Convenience. Let your customer decide the most convenient way to buy from you. Many customers want to use credit cards because of reward points or reward miles associated with their credit card. Customers are more likely to buy from a business that accepts credit cards than one who does not. Don’t lose a customer to a competitor just because you don’t accept credit cards.

7. Larger orders. The average order size of someone paying via credit card tends to be larger than someone paying by cash or check. And larger orders = more profit. In addition, customers paying by credit card tend to place extra orders and order more often.

8. Competition. Your competition is already accepting credit cards. You need to accept cards in order to survive.

9. A merchant account is inexpensive. Gone are the days of high rates and fees. Today’s credit card processing rates are so low even the smallest mom and pop outfit can easily accept credit cards. In fact, usually the increase in sales a business receives when they do accept credit cards more than covers the small costs involved. As a result, by accepting credit cards many businesses make more money!

10. Quick and easy setup. Many businesses think getting setup to accept credit cards is a long and tedious process. No more! Most of the time you can be up and running within 24 – 48 hours. If a provider tells you otherwise, go somewhere else!

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