ACH Payment Processing: A Payment Method For Every Business

Fast, Easy Setup For Recurring Payments

Every industry can benefit from offering ACH payment processing for one giant, colossal reason: When a customer or merchant is unable to complete a credit card transaction, payment by check is always a viable, secure solution.

What is an ACH Payment?

ACH, short for Automated Clearing House, is an electronic payment solution which enables merchants to deduct funds directly from customer bank accounts. ACH transactions save time and money because, unlike credit card transactions, there are no interchange fees involved. Additionally, the customer and merchant do not exchange any documents or check numbers.

An ACH merchant account works like this:

1. The customer provides preauthorized written, verbal or electronic permission for the merchant to process the check.
2. Through a batch file transmission, a payment gateway or a virtual terminal, the check is converted into an ACH transaction and it is submitted to the merchant’s payment processor.
3. The merchant’s check processor sends the ACH transaction to the customer’s bank and checking account to debit the approved funds.
4. An ACH payment usually takes between 3-7 days to clear. However, NACHA, the Electronic Payments Association, is making changes leading to same-day ACH payments.

The inner workings of an ACH merchant account transfer may appear complicated, but it is simply the process of debiting money from the customer bank account into a merchant account. Same-day ACH processing will streamline this process even more.

Virtual Check allows merchants to enter their customer’s bank account information into a checkout page, virtual terminal, Web API or a batch upload to collect funds. Once transactions are submitted, they will be verified to make sure the consumer bank accounts are valid. If the check does not get declined through the authentication process, the checks are turned into a remotely created check (RCC) and then printed out into a demand draft. The processor will then take the demand draft(s) to the merchant’s bank account for deposit.