Pharmacy eCheck Processing
Pharmacy credit card processing can be expensive, especially as banks become stricter with pharmacy merchant account guidelines. Most online pharmacies have had to shut down because of a lack of payment processing services. Other pharmacies have resorted to using high-cost solutions through 3rd party providers. Pharmacy echeck processing is the best way for a pharmacy to accept payments and reduce their risk of losing payment processing services.
E-checks are similar to paper checks, but are handled in a full electronic manner. Funds are quickly debited from the customer’s account, allowing businesses to process and ship orders in a quick process. Today, most personal transactions are done by through checking accounts; whether its echeck or debit card. Fortunately for customers, they will not notice a difference while the merchant will see a decrease in payment processing fees.
Why Accept Pharmacy Echecks?
Over the past few years, it has become increasing challenging for pharmacies to set up payment processing services, especially with affordable rates and fees. These changes have created demand for alternative payment methods, specifically check processing services.
Many of the troubles facing online pharmacies are in direct response to increasing government regulations imposed on Visa and MasterCard. Fines and other penalties faced by these companies have only made it harder for online pharmaceutical merchants to operate.
Another challenge facing online-based pharmacies is the banks and payment processors underwriting the merchant accounts. Many of the fines and restrictions faced by Visa and MasterCard are directly passed to the payment processor or bank. This is been the major reason why underwriters have become stricter with the businesses they accept.
Using eChecks has become one of the best ways for merchants to avoid many of the challenges and problems facing credit card transactions. Aside from easier terms and fewer restrictions, the fees charged to merchants for eCheck is significantly lower than what others would pay to accept credit cards.
Using echecks, customers will receive the same type of reporting as a credit card merchant account. Detailed lists of the various types of transactions includes sales, refunds and chargebacks along with details settlements help merchants manage their finances.
With nearly all of the same functions in about the same amount of time, except with much lower costs, the use of e checks has taken off in the online pharmaceutical industry.
Problems with Pharmacy Payment Processing
One of the largest problems that pharmacies face when accepting payments is fraud. While most payment gateways have their own fraud protection programs, this does not always prevent losses. These losses can come in the form of chargebacks, and in great enough quantity they can lead to merchant account termination.
To combat chargebacks, many merchants have resorted to various practices to help reduce instances of fraud. These fraud prevention programs include ways to check a customer's IP against their billing location or other transactions from different users. Stopping fraud saves both banks and the pharmacies large sums of money and can help merchant accounts remain open.
In many instances, the use of a virtual terminal is directly tied to fraud. While most merchants will work to ensure that the transactions they are putting through are completely legitimate, the instances of theft and fraud of customer account information has become troublesome. This has restricted many payment processors from offering any type of virtual terminal solution to pharmacy merchants unless they have a proven track record.
How to Accept Pharmacy eChecks
Similar to pharmacy credit card processing services, accepting a check online can be simple. There are a few ways merchants can easily accept pharmacy echecks.
Used by most e-Commerce merchants today, a payment gateway allows customers to input their payment information securely for submission to the processor. The customer is shown a blank check and required to fill in all of their information. This is a preferred method used by merchants since all information is maintained by the customer and processor.
Merchants that obtain customer banking information from the customer directly can use a virtual terminal. Through the echeck virtual terminal, payment information is securely transferred to the echeck processor for immediate authorization.
Merchants that collects customer banking information can send the payment information from their computer. Uploading a file with complete customer payment information, the echeck processor can convert each transaction into an echeck and process the sale.
Once eCheck information is received, it normally takes between 3-5 days to clear depending on the bank. Merchants will be alerted of a cleared transaction by receiving a notification of “collected” by the payment processor. Merchants will experience lower fees than accepting credit cards and consumers will not have to pay foreign transaction fees. The risk of merchants is also substantially less with eCheck as chargebacks are more difficult for customers with shorter time frames and more steps.
Pharmacy eCheck Payment Gateway
Payment gateway integration of eCheck services is possible with almost every major payment gateway provider. At Allied Payments, we have the ability to integrate with; WooCommerce, Shopify, Magento, Opencart and Prestashop among others. This flexibility allows merchants to simply add eCheck to their shopping cart functionality without any major changes required.
All payment gateway transactions are fully secure, eliminating the risk posed to merchants and customers. Using SSL encrypted servers helps merchants protect themselves from any type of hacking that could jeopardize their customer's account information. Most customers today know that they should only provide senstive information online through SSL protected webpages.
Using a PCI Compliant gateway is also important when maintaining the integrity of a payment gateway. When connected with an SSL website shopping cart, a PCI Compliant gateway will protect the transfer of sensitive banking information from the shopping to the gateway. Merchants that work with a non-PCI Compliant gateway provider run the risk security breaches and significant losses due to fraud.
The API provided to merchants working with Allied Payments allows for quick website integration into the payment gateway. This API integration will allow online pharmacies to accept orders directly from their website for automated check processing. Without the need to manually enter orders or upload transactions on a daily basis, merchants can focus on fulfilling orders and marketing rather than managing payments.
Using a payment gateway will also give merchants access to the echeck virtual terminal. The virtual terminal is commonly used by merchants handling phone and mail order sales. This means that customers do not have to go on the website to enter their payment information, rather the payment information can be accepted at the time of sale and charged immediately. This can also help mitigate risk by having every order verified by the merchant to curb fraud or other potential problems.