Ach Merchant Account Electronic Payments
What is ACH?
ACH is the transfer of funds electronically and directly from one bank account to another for payment.
ACH Payments are the transfer of funds electronically using the Federal Reserve Banking System’s ACH Network. The ACH Network acts as a centralized electronic network connecting most US banks. This network allows for the transfer of funds to and from bank accounts and to provide reporting of those transfers. These banks have a pipeline often referred to as a Federal Line that connects them to the ACH network and thus allows for their participation. ACH stands for Automated Clearing House, the term given to that network and payment system in general.
ACH Payments, also known as electronic funds transfer (EFT), is governed by NACHA (National Automated Clearing House Association), a not-for-profit organization that promotes the system and regulates policy. Though there are private clearing houses, the Federal Reserve Banks are the largest ACH operator in the nation, collectively processing more than 80% of commercial ACH transactions.
How does it work?
The simplest and most common ACH/EFT transaction type is Debit. Example:
A merchant signs up for ACH services through an ACH Service Provider such as Check Merchant Account through an Check Processor. An ACH account allows the merchant to debit (charge) their customer’s accounts for payment of goods offered or services rendered.
The merchant offers their customer payment via ACH as an option, thus allowing for direct payment from bank account to bank account (checking or savings). As required by regulations, the customer must provide authorization in writing, giving permission to the merchant to apply the debit toward their account for the agreed upon date and amount.
Using a computer with Internet access allows the merchant to access our website and login to our secure Payment Gateway using their unique Username and Password.
Once accessed, our Gateway can be used to submit a Direct Debit ACH transaction for payment.
When the sale is complete, you will be able to print the confirmation for your records.
Check processor compiles and transfers the transaction for transfer to the banks and upon acceptance by the bank, releases the funds to the merchant account for payment. Funds are released later according to the agreed upon release day of funds between the merchant and echeck processor.
Who uses ACH?
Anyone who accepts checks can use ACH.
What are the benefits of using ACH?
Anyone who wants to save the time and expense of the paper check processing model or wants an additional or cheaper alternative to credit cards can use ACH.
Examples of how ACH can provide value to you:
Direct Debit from a customer account to yours for payment on goods or services
Direct Deposit for payroll, benefits, and fees or expense allocation
Pay bills electronically from your account for utilities, loans, insurance and more
Make or collect on business to business payments
Collecting on corporate receivables
Check or e-commerce payments