Differences Between E-Checks & Paper Checks

Paper checks have been around for quite some time. Though paper checks are still popular, many businesses have switched to eChecks in the last decade. eChecks make good business sense. They are good for the environment, are safer and more convenient than traditional checks, and can help businesses save time and money.

Businesses should allow their customers to use different payment options. With advancements in e-commerce, many merchants are switching to eChecks.

What is a Paper Check?

Paper checks can be used to withdraw money directly from a checking account. A paper check must contain the name of the payee and the payer’s signature. Paper checks are safer than cash payments as the canceled check becomes a permanent record of the payment.

ECheck: An Overview

eChecks or Electronic checks are digital versions of paper checks. Like a paper check, an eCheck draws money directly from the payer’s account. Both eChecks and paper checks have tracking numbers. Details related to eCheck transactions can be recorded in a physical or online checkbook register for future reference.

Total Costs

The high cost of issuing paper checks is one of the major reasons why businesses are switching to eChecks. The cost of issuing a paper check ranges from $1-$26. An eCheck, on the other hand, will cost you just $0.30-$1.50. Echecks are also more secure than paper checks.


A traditional paper check contains limited information about the payer and the payee. If you want to keep a record of the data contained in a paper check, you will have to manually type in the numbers.

E-checks can hold more data than their traditional counterparts. A major benefit of eChecks is that data is stored electronically, which means you do not have to save the payment information every time you use an eCheck. Plus, you can access the payment information related to a transaction in any format you desire.


Providing more payment options is one of the most effective ways to increase sales. Offering eChecks expands payment options for customers as they can be accepted online, over the phone, and in-store.

Information contained in an eCheck is electronically transmitted for processing. Unlike paper checks, eChecks do not need to be sent via the mail. You do not have to drive to your bank or scan your check before depositing it.

Potential for Errors and Frauds

eChecks reduce the potential for fraud and errors as few people handle them. Some eCheck security features include authentication by digital signature, duplicate check detection, and public key inscription. An encryption feature checks the dollar amount and account number.

Data contained in a paper check can be easily forged. Minute errors in a paper check are difficult to detect. EChecks are processed electronically. Machines scan checks carefully. Even minor errors are eliminated.

Processing Time

eChecks usually take less time than paper checks to process. This is due to three reasons

  • eChecks are electronically processed
  • They have smaller hold times than paper checks
  • Paper checks are sorted, transported, presented, and reconciled. eChecks eliminate these steps

Businesses that accept eChecks receive funds in their accounts almost twice as fast as the ones that use paper checks. In 2016, same-day ACH became a reality. Businesses no longer have to wait for days for a check to clear.

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