The Pros and Cons of Electronic Check Conversions
- If you have a dispute with a merchant and you paid via electronic check conversion then you have the right to have your financial institution investigate any transfers which you believe were unauthorized or incorrect. However, you only have 60 calendar days from the time the bank statement was sent to you to notify the bank of the problem. So, it is important for you to carefully review every statement that you receive.
- Merchants typically cite several benefits to the electronic check conversion payment system. They claim that it reduces their bank fees, reduces the time that their employees spend on deposits and reduces fraud. While these benefits directly benefit the merchants, they may also benefit consumers by preventing price increases.
- If you do not have a debit or credit card, many businesses will accept an electronic check conversion as a form of payment while they may not accept traditional checks. This may allow you to purchase things that you would not otherwise be able to do absent a credit or debit card and you can do so with the risk of credit card debt since the money is withdrawn directly from your bank account.
- Funds are typically released from your bank account much faster than when you pay by ordinary check. Therefore, you must make sure that you have enough money in your account to immediately cover the payment.
- You will not receive any copies of the cancelled checks from your bank, even if you provided a paper check for payment.
The information on this page is meant to provide a general overview of the law. The laws in your state and/or city may deviate significantly from those described here. If you have specific questions related to your situation you should speak with a local attorney.
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