5 Things to Know About Accepting ACH Payments

ACH PaymentsPayment processing is all about ease, reliability, and options. American consumers like to be able to make purchases and payments in the way they most prefer—and in fact, they expect it.

Some don’t trust payment cards and prefer cash, while a few are still wary of online electronic payment systems. Then, there’s the rest of us, who just want to be able to use whatever method we have on hand so we can walk away and check the pay bills box on our to-do list as completed.

On the business side, of course, you want to be able to take those payments, regardless of whether or not your customer left her card at home today or the unfortunate time when he is short on cash and forgot to hit the ATM. You never want miss out on taking a customer payment because you didn’t have a method available—especially if the customer is ready and willing to pay.

For that reason, most business owners are wisely expanding their payment options. While cards, checks, and cash are well-known, another type of bill pay option is electronic payment via ACH, or Automated Clearing House. The benefits of this type of payment can be very appealing for many small business owners looking to find new ways for customers to easily and conveniently cover bills or purchases.

If you haven’t heard about this type of payment, here are five very important Q & A’s about ACH payments that you’ll need to know in order to understand why most businesses should consider adopting it as a bill pay option.

What is ACH?

This type of payment allows merchants to accept payment directly from a customer’s bank account, instead of having to take checks or cards. ACH payments can be used for recurring billing, direct deposit, B2B transactions, and online payments. The system was originally started as a way to replace paper checks and has increased steadily in usage, with more than $38.7 trillion being transferred by ACH payment in 2013 alone.

How does ACH differ from debit and credit cards?

Because these payments bypass the card system entirely, they also bypass the assessment fees usually charged by credit card networks and processors, although a flat fee per transaction applies. While debit cards and ACH both draw directly from the customer’s bank account, the debit card is subject to the same rules and fees as a credit card because of how it’s processed.

What methods are used to process ACH payments?

There are several methods for processing ACH payments, but some are more difficult to use than others and have different fees associated with making payments. Converge is one example of an easy-to-use payment system that offers ACH, as well as a variety of customizable payment options.

Can my business benefit from ACH?

Most businesses will benefit from offering an ACH option for customer payments, but the businesses with the most to gain are those offering products or services that require a payment schedule. Most ACH payment systems offer automated bill pay as an electronic payment option, which will automatically withdraw a set amount from the customer’s account each month. This process makes regular payment schedules both easy and convenient for businesses and customers. ACH is also useful for any type of online or mobile payment, and with the right system, you can easily store the customer’s information on file in a password protected account where they can easily make future payments with a few clicks or a phone call. Even better, ACH processing is typically more affordable than most other methods of electronic payment, which can save your business money over time.

How do I sign up ACH payment processing services?

You will need to speak with a merchant services provider who can answer your questions about an ACH system and other payment options that work for your needs. With the minimal fees and the diverse functionality of ACH electronic payments, many businesses would benefit by offering the option to clients who need either one-time or recurring bill pay capabilities that don’t involve payment cards.

As a business owner, only you can determine the right steps for expanding and growing your business. Accepting ACH payment is one natural step for growing your business’s capacity for meeting customer needs. If you haven’t already explored the capabilities of an ACH system, take a moment to review the risks and benefits today so you don’t miss out on a low-cost, convenient option to expand your company’s ability to process electronic payments.

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Ashley.jpgAbout the Author – Ashley Choate is a native of Jacksonville, FL where she lives with her son, dog, and three cats. She graduated Magna Cum Laude from Jacksonville University with a BA in English and holds an MAED in Adult Education and Training. She lives for reading and writing, learning and teaching, and figuring out the day-to-day traumas and joys of mommyhood. .

 Top Photo Courtesy of Pixabay.