Accepting ACH Payments for Your Small Business

As a small or medium business owner, getting paid by your customers is often trickier than it needs to be. And it can also end up costing you more than you had bargained for, especially if you mainly accept debit or credit cards, as these come with hefty transaction fees attached. Accepting ACH payments is one way to make sure that you’re getting paid quickly, efficiently, and cheaply allowing you to keep hold of more of your profit. Keep reading to find out more about how to accept ACH transfers to your business.

How ACH Transfers Work

ACH payments are transfers that are made electronically from one bank account to another. They are made possible by the Automated Clearing House network: a hub that is connected to the majority of banks and financial institutions in the US. Chances are that you have already used or been paid by ACH transfer before, for example, receiving a direct deposit payment. Automated payments for your bills, or a recurring amount into a savings account are also likely to be ACH transfers.

How to Make an ACH Payment

To set up ACH payments with your customers, you will need to follow these steps:

  1. Get the customer’s checking account details or provide your bank account details to the customer. Both parties will need an account number and a bank routing number. There are various third-party platforms, such as Stripe, that you can use to do this.
  2. Enter the account information into the transfer platform and set up the payment. This can be scheduled immediately or on a specific day.
  3. There may be a fee to make or receive the transfer. This will vary based on the platform that you are using.
  4. The platform will let you know when you can expect the process to be complete, and the payment to be made.

How Much Time Does an ACH Transfer Take?

Typically, you can expect to wait around 1-2 business days for an ACH transfer to clear. However, if you need the money in your account faster, there is an option with a larger fee for same-day processing. There are also some payment platforms like Zelle that you can use to instantly transfer between banks through the ACH networks without any additional fees.

How Much Will It Cost My Business to Accept ACH Payments?

How much you will pay to accept ACH transfers from your customers will largely depend on the payment processing service or platform that you and your customers are using to make the transfer. Generally, you can expect to pay around $3-$10 per transaction in fees, which is much less than credit card transaction fees. In some cases, it may not cost you anything extra to receive an ACH payment, especially if you are using a subscription model platform as the monthly subscription will usually cover any transaction fees.

No matter what kind of business you run, accepting ACH payments is fast, easy, and a great way to reduce the amount of money you spend on transaction fees.