Getting it Right: eCheck Rules for Online Giving

There are many rules and regulations which you, the merchant, agree to be bound by when you enter into a merchant agreement. There are separate rules for accepting credit cards than there are for accepting eCheck transactions, and after reading them all it makes your head spin! It is often difficult to see how these apply to your organization and whether or not you are abiding by these guidelines. In several of my previous blogs, we discussed what these rules are and I provided you with some best practices; however, the purpose of this blog is to provide you with some practical applications you can implement to meet the rules as outlined by NACHA for accepting eCheck transactions.

Online Giving

When your donors go online to give to your organization, they are authorizing your organization to debit their payment method for the exchange of funds. According to NACHA Rules and Regulations, there is specific authorization language you must provide to your accountholders as part of this process. Luckily, if you are using our QSuite product, we have already got this covered, as the authorization language required to meet this requirement is included at the bottom of your giving page! If you are not using our product, you will want to make sure that your giving or registration page includes similar language as is found below.

I authorize {Organization Name} to collect $0.00 from my account.

I hereby authorize {Organization Name} to collect from my Account the above amount. If this transaction is a donation, it is considered non-refundable. If I need to request a refund of a donation, I agree to contact {Organization Name} as soon as possible to make the request, knowing that there may be circumstances that prevent such a refund from being made. By checking the box I acknowledge that my account will be charged as outlined above and that payment is to be made when billed in accordance with the standard policy of the issuing bank.

In the event this transaction is later disputed and you are requested to provide proof of the authorization process, you would simply take a screen shot of the following items: the authorization language found at the bottom of your giving page and the details of the transaction found inside your DonateQ system which include the date the transaction was processed, the contact information entered by the accountholder, the amount of the transaction and any comments or categories specified.

Written Authorization

While most of your constituents will be thrilled by your new online giving platform, others prefer something more tangible like a giving envelope or mailed-in forms. This does not mean, however, that everyone can’t engage in your new model in one way or another.  As a service to your supporters, many organizations offer to enter transactions on behalf of the donor. This can be a great way to incorporate even the less tech savvy individuals in your online system. Just remember that according to NACHA Rules and Regulations it is required that these transactions be entered through the Virtual Terminal and that you obtain written authorization for this transaction.

The Rules go on to state that the form must be recognizable as an ACH authorization complete with authorization language. It does not have to be overly fancy. A simple form on company letter head that includes a section for the accountholder to provide their contact information (think address, phone, e-mail) and includes similar language as outlined below can be used.

I authorize, {company name here} , to electronically debit my bank account or credit card for automatic payments in the amount of $ {amount} per/{frequency} for {duration}. The automatic payments will begin on the ____(day) of _____(month).

I understand that this payment will continue to process until I provide written notice to {company name here} of my desire to terminate this agreement.

Be sure to include a line for them to print their name, provide their written signature and date the form. They will also need to provide their payment information.

The donations obtained through this process must be keyed in by your donor management team directly into your Virtual Terminal. Once the information has been entered, the authorization form is then stored in either a locked filing cabinet or scanned and saved in an electronic format so that, in the off chance the charge is later disputed, the form can be provided as supporting documentation. 

Make these forms easily accessible for those individuals who do not wish to create their own online donations by including the form in your regular mailers or e-mail blasts, making them available on your website to be printed and returned, or providing it inside your church bulletin so it can be completed and included in the offering plate.

The requirements you face as a merchant can seem insurmountable and overwhelming thanks to the vague words written in legal jargon. However, the Rules are more attainable then they first appear. Applying the practices outlined above makes operating within the Rules both simple and pain free!

See Related Posts:
eCheck Authorization Process: WEB Transactions
The Basics: ACH Payments – The Roles
The Basics: ACH Payments – The Process