As I stated in my earlier article, E-Check is an electronic version of a paper check. E-Cheque writer writs the check using electronic means and gives the check to the payee. Payee then deposits the E-Check, receives credit and the payee’s bank clears the E-Check to the paying bank. Paying bank validates the check and charges the check writer’s account.
E-Checks can be handled by all account holders large or small. Other payment options are too risky for an average person doing small business. E-Checks can be used with existing checking accounts and can be initiated using variety of hardware and Software applications.
E-Checks are based on the Financial Services Mark up Language (FSML) and have strong digital signatures. These checks are based on secure hardware tokens such as smart cards and contain digital certificates to use in banking and business practices.
E-Checks have the highest security so that even breaking the cryptographic protections would not allow fraudulent transactions.
In future E-Checks will be more popular with customers because of the easily understandable nature, easy to process and extremely safe nature. E-Checks fall under the legal framework because banks are providing the leadership, controlling the process and payment mechanism.