Electronic Fund TransfersPaid On Time, Every Time
What are Electronic Fund Transfers or EFTs?
EFTs process pre-authorized debits or credits from one bank account to another within a 48 hour period to handle your company's payroll, accounts receivable, accounts payable and/or NSF checks (RCK - returned checks). This electronic computer based process requires the use of special licensed software and a modem. All transactions are governed by the Federal Reserve Banking System.
For those of us familiar with ATM cards at gas station pumps and grocery store check out lines, the concept of EFTs continues to earn the confidence of consumers and is therefore being applied in more and more settings. Over the past several years, EFTs have gained in popularity among businesses as well. Now any business, regardless of size, can use EFTs to conduct a variety of financial transactions.
What are the benefits of EFTs?
The benefits of EFTs are many. For receivables, benefits include prompt payment of your customers bills each month and early notice of insufficient funds. You get your cash on time, every time. While there is a small fee per transaction for this service, EFTs eliminate the need to print, process and send a monthly bill in many instances. This can save you as much as $2.25 to $3.00 or more per customer. Thus, you could lower your costs for labor to prepare statements as well as postage and the cost of paper used to print statements. EFTs also reduce late payments and the need to send out reminder notices.
EFTs can actually increase your customer retention. This is most likely to occur in businesses that bill the same amount on a month to month basis for ongoing services such as pest control companies, newspapers, pool services, security companies and the like. Having the fee automatically deducted from your customers checking account increases the retention of those who might otherwise let the service lapse.
You can save hundreds, even thousands, of dollars on your billing and administrative costs, dramatically improve your cash flow and eliminate many of your collection hassles by using the EFT services.
While you are saving money, your customers benefit from EFTs as well. With ETT Consulting, customers will no longer have to worry about missing billing deadlines. Bills are paid even when your customers are away from home. No more writing checks, no more postage, no more service charges for checks and no more embarrassing second billing notices and late payments. EFT is free to your customers and your customers will appreciate this value added service.
How does the EFT transfer process work?
First you have your customers sign a form that authorizes you to deduct their payment on a certain date. Your customers provide you with a checking deposit slip to verify all account information. Then you create the initial database. According to the billing cycle, the amount of your customers bill is then automatically debited from their checking account and deposited into your account. In the case of payroll, your account is debited and your employees account is credited each pay period.
Who inputs the information into the computer?
ETT Consulting provides the software and training to you so you can download needed transaction information directly from your existing accounting systems using the EFT for Windows ASCII format. This means no re-keying of data which minimizes errors and expedites the process. Typically hundreds of transactions can be downloaded and sent to ETT Consulting in a matter of minutes.
How much time is required to establish the initial EFT database?
It only takes a few seconds per customer to input name, bank account number, routing transit number of their bank, the amount of the debit, and the due date. Its that simple! Once the database is established, the only component that changes each billing cycle is the due date and perhaps the monthly charge.
How safe are EFTs?
All EFTs are governed by the Federal Reserve Banking System. Only pre-authorized transactions are allowed to be processed. This is strictly enforced by the Federal Reserve. Customers must authorize all EFT debits from their checking account in writing.
How will I know that the information sent to ETT Consulting has been received and processed?
The ETT Consulting software prints several different reports for you. Both before and after the data has been sent, you can print a report that documents your transaction. ETT Consulting provides you with a status report the same day that verifies all of the transaction information. You will know within 24 to 48 hours if any of your customer transactions failed to process due to insufficient funds or incorrect data entries. Most banks take as long as two or more weeks to notify businesses of insufficient funds on checks being processed. Clearly ETT Consultings EFT services offers your business a better alternative to processing checks for financial transactions.
How much will I pay for the EFT services from ETT Consulting?
ETT Consulting bases its transaction fees entirely on volumethe more EFT transactions, the lower your fee. One EFT transaction consists of one debit and one credit of the same dollar amount. The fees do NOT vary by the amount of the transaction. You pay the same amount for a $5 transaction as you do for a $500,000 transaction. In nearly all cases, this figure is less than the cost your business bears to process receivables, payables and/or payroll transactions by checks.