A common example of this debit entry would be for recurring payments from a customer to a merchant where the merchant “pulls” the funds on a regular basis from the customer’s checking account.Ī credit ACH is a “push” which is generally used for moving money or sending money. Instead, an ACH debit is simply a transfer or “pull” from one bank account to another. Merchants dealing with payment processing do not generally deal with the direct deposit aspect of the ACH system.ĪCH transfers can be both credit and debit, but this does not refer to card types. These are generally for handling payroll, government benefits, or sending money between bank accounts. The second is for direct deposit or wire transfers. They are usually done between two private entities such as a merchant and a customer. These work similarly to old paper checks but are done electronically through the ACH. ETF is a blanket term that covers a variety of electronic transfers including ACH and wire transfers.ĪCH payments facilitate two types of payments. It’s also important to note that an ACH is not the same as an EFT or electronic fund transfer. This is also why there is a different fee structure than credit and debit card transactions. This clearing house is what handles the transfer of requests and payments between the two entities’ bank accounts when performing an ACH payment or transfer. ACH payments go through what is known as the Automated Clearing House, or ACH, which is where the acronym comes from. Basics Of ACH PaymentsĪCH payments are handled via a different network than the credit card and debit card transactions most merchants are familiar with. We’ll also look at situations where merchants would want to accept ACH payments. So below, we’ll go into further detail about ACH payments, how they work, and how to avoid paying more than you have to via fees. This includes the various fees and other costs involved that are often different from debit and credit card fees.ĭespite all that, there are still many situations where ACH payments make sense for merchants. However, there are also unique aspects to ACH transactions that merchants need to be aware of when processing these kinds of payments. ![]() ![]() Over 25 billion ACH payments are handled per year by financial institutions, so this method of electronic payments is still something to consider for most merchants dealing in online payments. The question that we will be answering today is how much are ACH processing fees? Although these cards are the most common type of online payment method, ACH and checks are still very common in almost all areas of business. When it comes to accepting online payments, most merchants primarily think of debit and credit card processing.
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