e-Cheque Payments for Sportsbooks
What are e-Cheques?
e-Cheques, sometimes spelled as eCheque, is short for electronic cheques. If you have a PayPal account, then you might have heard of the ACH cheque. Simply put, it is an electronic method of submitting your cheque. Instead of handing over a physical paper cheque you are sending and approving its use over the internet.
US banks were the ones to first offer eCheques because they were able to come up with security features for it, which includes its clearing system.
To certify your e-cheque you will have to supply your online bookie with your banking details or chequeing account details. That includes your chequeing account number. You will also have to supply the routing number where you will initiate each particular transaction. If you notice, it’s going to be like writing a cheque, the only difference is that you’re not using an actual physical chequebook.
One benefit of an echeque is the fact that you have an alternative to credit cards such as Visa and MasterCard. Sure you’re still using your credit or bank funds, but what if you don’t want to use your credit card since you’re planning to use your credit elsewhere?
Some people have setup a separate electronic chequeing account for betting online, which is actually a pretty smart thing to do. You don’t want to mix your personal money and your gambling money – as a rule, that is.
Obviously, making deposits and withdrawals using eCheques is one of your options when betting online. However, you should note that not every bookie will honour eCheques. The number of e-cheque fraud transactions that have occurred in the late 2000s, and the preferences of sportsbooks have changed over the years. You can say that e-Cheques used to be one of the instant ways you can top up your bookie account but not anymore.
A personal e-cheque can still be considered as one of the easiest and most convenient ways to transact with your bookies. Betting on your favorite teams in bookie sites will be pretty easy especially if you already have your own personal chequeing account.
One of the reasons why e-cheques became really popular is due to the fact that you don’t need to pay any transaction fees. It’s already an online service provided by your bank, which is why it is free. On top of that the transactions are safe since you’re relying on your bank’s security system that it has already setup.
The money transfer is electronic from your bank account to your online sports bookie. Once you have nominated your e-cheque as your preferred electronic payment system, the bookie should certify it through your bank.
Features of e-Cheques
E-cheques have features that make them better than regular paper cheques. For instance, since the cheque is electronic you can be sure that the speed of the transaction has greatly improved. You no longer have to wait days for a cheque to clear.
Another feature of echeques is that processing fees are lower. In some instances, the processing fees are waived. Now, electronic cheques are actually very easy to implement – well, that is if a company has found a certified gateway partner (which is one of the issues against e-cheques – we’ll cover that below).
Finally, there is a reduced level of risk when using e-cheques compared to an actual paper cheque. There is no paper being handed over to another entity and there is an existing database of bad cheques on record. On top of that there are also risk parameters in the clearing system, which provides the necessary screening.
Pros and Cons
Betting and other online transactions using e-cheques have their pros and cons. It’s not a fool proof system and it does have flaws. Let’s begin with the pros first.
a) The transactions are easy to make.
b) It works well, especially if you already have your own personal chequeing account.
c) It allows you to use the chequeing account you already have with your bank.
d) E-cheques usually have very high deposit and withdrawal limits just like regular cheques.
e) There are no transaction fees that you need to pay for, unlike credit cards and other modes of payment.
f) The bank transfers the money to the bookie straight away.
And now for the cons:
- One big downside of this online transaction payment method is in its wait time. The length of the wait time will vary from one bank to the next. At the most, it will take up to six banking days before they complete the transaction.
- There are only a few bookies who accept electronic cheques nowadays and there are also a few banks that offer this payment method as well (cheque with both your bookie and your bank if this option is available).
- There have been e-cheque scams that have occurred (and still continue to occur today). Note that these electronic cheques are still cheques and they can bounce.
Betting with e-Cheques
As stated earlier, an electronic cheque or e-cheque is considered as one of the easiest ways to top up your sports bookie account. The only thing that you need is the personal chequeing account you already have with your bank. All you need is an e-cheque, a chequeing account, and a bookie account. You can register your electronic chequeing account on your bookie account page to get things started.
How does a transaction happen? Here’s how. The first step after registering your electronic chequeing account on your sports book page, you can then make your first transaction – usually an account deposit.
The first step is to go to the payment page of your online bookie site. You may be required to enter your username and password as an added security feature but this step may not be required by other sports books.
The next step is to enter the amount that you would like to deposit. Make sure that you are using the right currency before you move forward with your transaction as that can mess things up big time if you fail to notice it.
After this, select your payment processor, which in this case is your e-cheque account. Remember that you should have registered your e-cheque account on the bookie site before making this transaction.
Note that the bookie withdraws the money from your chequeing account. It’s an interesting alternative because you won’t have to deal with fees (e.g. credit card and transaction fees). It also helps you avoid the frustration of bookies declining your credit card..
After they have certified your electronic cheque, you can use it immediately. Note that the withdrawal and/or deposit limits for this mode of payment are usually around £5,000 each week.
Now that is a huge limit compared to other payment methods that don’t really reach into the thousands – except for paper cheques of course which are a good option for high rollers. Again, the limits for withdrawal and deposits will vary from bookie to bookie.
The e-Cheque Payment Cycle
The payment cycle or process is rather easy to understand. Here’s how it happens in your bookie’s perspective. The first step is for them to offer e-cheque payments. Those who have e-cheques (that includes you, their customer) opts for it, thus giving them authorisation to access your account.
To provide that authorisation you give the merchant (i.e. your bookie) the necessary credentials. They then forward this information to a payment processor – this is third-party company that handles the e-cheque transactions – bookies can’t transact directly with a bank. The third party is a layer of protection and security.
The payment processor company receives the transaction details and the date as well. This company forwards the information to your bank. The payment processor and the bank will then verify the information. This is again another layer of security. Think of this as a clearing company.
Once they have verified the details, that is the only time when the bank will forward the payment to your bookie. It’s pretty much like clearing a paper cheque only that the process is a lot faster.
Not Everyone Can Offer Them
We can say that the biggest drawback about e-cheques nowadays is that if you really want to use them, you may be hard pressed to find a bank and an online bookie that uses them. First off, the clearing system for these e-cheques is pretty complicated.
And when something is complicated for a bank or any other financial entity, you can be sure that running that system can be quite costly. Not only is the technology behind e-cheques that complicated the processing agreements between the company and the bank that will be issuing the electronic cheque can be pretty complicated – which is another reason why a lot of bookies have quit offering this payment option.
You have to go through big online registration companies, which means more bills and fees to pay. This is one of the reasons why small and medium sized companies, especially startups, stay away from electronic cheques even though they can be quite a convenience for their customers.
Are e-Cheques Safe?
You can say that e-Cheques are just as safe as any electronic transaction. The encryption technology has greatly improved since the days of electronic fund transfers. Regulation E also protects customer, where banks are required revoke payments made within 60 days of the transaction date if a customer deems a transaction to be fraudulent.
But that has not stopped the cheques from bouncing. Couple that with the complex and expensive system that goes with e-cheques, then sports books have opted for a simpler methods to process customer payments.