Online Payments

How Customers Use Electronic Funds Transfers (EFTs)

aerial-photo-of-buildings-and-roads-681335electronic funds transfers

Every time a consumer accepts or sends a direct deposit, they’re using an electronic funds transfer or EFT. Every time they withdraw cash or deposit a cheque into an ATM, they rely on an electronic funds transfer. The same goes for tapping their debit card at the grocery store. Or using a bank’s website for online banking or bill payments.

Electronic funds transfers handle our salaries, bill payments, cash flow, mortgages, and online and in-store purchases. They give us unprecedented digital access to funds without ever entering a physical bank, talking to a teller, or handling cash. In short, an electronic funds transfer is the digital transfer of money from one account to another. 

Today, we’re looking at how electronic funds transfers are changing the world of digital banking—and how your customers are (or should be) using EFTs.

EFTs/ACHs: Moving trillions of dollars digitally

In the U.S. all electronic funds transfers go through the Automated Clearing House (ACH) Network. ACH transfers are the same as EFTs in Canada, only they are all routed through the ACH Network—one of the largest networks in the world. 

In fact, in 2019, the network moved 24.7 billion electronic payments and $55.8 trillion. It is how 93% of American workers get paid. It’s also how millions of Americans will receive stimulus payments during the coronavirus emergency. Payments Canada reported that electronic payments accounted for 73% of all transaction volume versus 21% for cash in 2019. 

Digital banking innovation and electronic funds transfers

Electronic funds transfers are the fastest, most secure, cost-efficient, and digitally connected way to send and accept money. The pace of innovation is showing no signs of slowing down. But where a bank EFT/ACH services may fall short, financial technology companies are partnering and helping to lead the charge toward more innovation in digital banking. 

Using VoPay’s EFT/ACH and iQ11 products, for example, customers can make e-commerce purchases without using a credit card. They now have instant access to available funds online and via mobile. Let’s look at innovations in electronic funds transfers and how your customers can use—and benefit from—EFTs/ACHs.   

5 ways your customers use (or should be using) EFTs/ACHs every day

1. Accept funds digitally

Just like a credit card, your customers can make purchases online using their checking accounts, which you can accept instantly with our EFT/ACH product. A great example of this is for an e-commerce site that collects payments at checkout. Rather than having customers racking up credit card debt, they can spend their money one-time and using recurring payments online. With VoPay’s Intelligent EFT / ACH called iQ11, bank account information is tokenized, thus encrypting personal data for security.

2. Send funds digitally

That same e-commerce platform business, as another example, may need to pay users, vendors, service providers, and/or bills. Using electronic funds transfers from fintech companies, rather than banks that don’t have this service, allows them to send direct bank payments. 

3. Move bulk payments

Likewise, EFTs allow customers to pay, collect, track and reconcile payments to and from many vendors and customers at once. This is a time-saving feature for service providers, for example, that charge monthly fees to many users at once. With VoPay iQ11, customers can validate and verify the user ahead of time, as well as the transaction and funds within 24 hours to help prevent NSF fees and boost security. They can also gather real-time acknowledgement and daily status reports to keep track of it all.

4. Facilitate payments through digital platforms

For those e-commerce sites, SaaS providers, and other customers that facilitate payments on their platform, VoPay’s accessible API is a secure and easy-to-use third-party solution. Being able to accept payments is an essential, yet often missing part of supply-chain management platforms and accounts payable software workflows, for example.

5. Me-to-me: Transfer funds between accounts

Transferring money within an organization or between a person and their business can be fast, safe, and easy with EFTs/ACHs. VoPay’s platform, for example, links all bank accounts both locally and internationally—and allows direct transfers. 

These are just a few of the ways in which you and your customers are using and benefiting from electronic funds transfers. The future of banking is here. It’s instant, secure, and digital, thanks to EFTs. 

Learn more about EFT / ACH payments.

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Online Payments

How Digitization Aids and Relieves Social Distancing

Digitization Benefits

During this time of uncertainty, health and safety authorities recommend practicing social distancing. This means maintaining a safe distance from others and avoiding local public transportation. Because of this, large scale events and gatherings, such as March Madness, shows at the Met, Carnegie Hall and Broadway, and Disneyland and Walt Disney World, have been cancelled or closed. Companies are beginning to encourage employees to work from home. Now is the time to unwind, stay home with loved ones and connect in person on a small scale or digitally. 

One (very thin) silver lining throughout this global pandemic is the digitization of our lives should we need to stay home for a time. Here are five basic functions that can continue with relative normalcy as we practice safe social distancing. 

5 Functions during social distancing supported by digitization 

1. Get paid, pay bills, and transfer funds online

Digital payments have made it possible to get paid, pay bills, transfer funds, and make purchases online Perhaps without realizing it, the digitization of payments has changed how we do everything online. Employers can transfer funds digitally right into their employees’ bank accounts in almost real-time. People can pay rent, health care and utility bills, online—without ever having to physically handle money, cheques, or even go to a bank. 

Interestingly, a financial services agency, The Futurist Group, recently conducted a two-wave study on U.S. consumers and contactless payments before and after the coronavirus. Of the 3,187 Americans surveyed, about 38% now see contactless (or digital payments) as a basic need or feature of payments, up from 30% a year ago. Those who don’t need contactless payments has fallen from 41% in March 2019 to 33% in March 2020.

A World Health Organization representative explained that “money changes hands frequently and can pick up all sorts of bacteria and viruses,” advising the use of contactless payments whenever possible. 

2. Purchase groceries online and order food delivered

E-commerce sites, restaurants with online ordering options, food delivery companies, and digital payments have all made it possible to have food delivered right to our doors. We can shop online for essentials (and non-essentials) and have them delivered directly to us within days or even hours. We can order breakfast, lunch, dinner, snacks, groceries, and medications online. We can support local businesses, such as owner-operated restaurants that are otherwise hurt by social distancing, by ordering their meals via phone or online for direct delivery.

3. Stay connected to loved ones digitally

It is essential to maintain contact with our friends and family members during this time. Discuss their health, wellness, safety, and happiness to ensure that they have everything they need. Applications both on our phones and computers have made it possible to connect and check-in with our loved ones and those who may need us, instantly and digitally. Of course, whenever health and distance allow for it, socializing in person (in small groups) can do wonders for our overall happiness during this time. 

4. Work online from home and connect through video meetings 

Depending on our occupations and health, we may be able to work from home and conduct meetings online. Just as applications allow us to stay digitally connected, many of these same apps allow us to stay connected to our teams via email, video, instant chats, and shared documents, for example.  

5. Entertain, inspire, and educate ourselves online

While major in-person cultural events are cancelled for health and safety reasons, there are smaller-scale ways to entertain ourselves. For example, companies like Netflix, Amazon Prime, DisneyPlus, and CraveTV have made it possible to watch thousands of hours of movies and shows. Likewise, there are informative, entertaining, and inspirational e-books, podcasts, social channels, videos, documentaries, articles, news sites, articles, you name it, all available online.  
According to health and safety authorities, a few things that you can do to support yourself are to unwind, take care of your mental wellbeing and happiness, connect with others, and maintain positive thinking. Prepare yourself, but take some comfort in knowing that the digital world has options to support some of your needs and welfare. 

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