If you are conducting business online, there are
multiple ways for customers to pay you, such as via debit card or credit card
or through an ACH electronic funds transfer. Each method has different processing
fees. ACH is the preferred method of payment for both customers and merchants because
of its many advantages.
Technology has benefitted business by reducing the
overall cost related to business processes, especially through the use of ACH
payments (Automated Clearing House). With online ACH debit transactions, the merchant obtains authorization
from their customer to electronically debit a payment directly from the
customer’s checking or savings account. Some common examples of ACH debit transactions
include insurance, mortgage, and utility payments. Many donors who regularly
contribute to non-profit organizations also often use ACH. Additionally, some
states provide an ACH debit option for businesses to pay taxes.
On the other hand, online ACH credit transactions occur when
funds are disbursed electronically from the merchant’s account to the customer’s
account. The most common example of an ACH credit is direct deposit payroll.
The main benefits of ACH credits and debits are
convenience, minimal processing fees, and faster payments. When a business
offers its customers the option to pay through ACH, it enables customers who
don’t have a credit card to purchase products and services online. Likewise,
credit cardholders who are reluctant to use their cards online can still make
purchases.
When the right tools are utilized to process online
check payments electronically, it is a win-win situation for both the customer
and business. Customers make payments quickly without worrying about security.
Businesses save greatly on processing fees when compared to standard credit card
transactions. Processing electronic checks online through the ACH network allows
you to receive money faster and keep more of it.
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