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Growing Business

The Benefits of ACH Payments

Posted by Sara Morrow on Thursday, April 8, 2021

Updated on Friday, August 18, 2023

ACH payment services are more secure than checks and credit cards, and can save your small business time and money. Learn how.

A woman holding an iPad, discovering the benefits of ACH Payments for streamlined and secure transac

Utilizing automated clearing house (ACH) services has become a great financial management tool. Many small businesses are using ACH to pay their employees via direct deposit. One small business we worked with got an overwhelmingly positive response from their employees and plans to continue offering this in the future.

These services allow you to send money directly between financial institutions without a paper check, credit card or physical contact. ACH payment services aren’t only for large businesses. ACH can save time and money for you and your team whether you’re a sole proprietor or running a business with 300 employees.

Read More: ACH provides online payroll services for small businesses

The Pros of Electronic Fund Transfers For Business, Customers and Suppliers

Now, let’s dive into some of the ways ACH payments can make life easier for your business, your suppliers and your customers.

Faster than a check

Making and receiving payments by check takes a lot of time. You have to write out or print the check; then you have to sign it; then you have to get it to the person who needs it; then that person has to go through the process of depositing it into their own account or cashing it. By using ACH services instead, your supplier will receive your payment the next day, instead of needing to wait for a paper check to arrive and depositing it. The same goes for your employees on the payroll.

In some situations, it is easier for your customers as well. For example, if you are a rental property manager, allowing your tenants to pay rent with ACH can give you peace of mind knowing that those funds are going to be paid on time every month, and the tenants don’t have to try to remember to write a check each month.

This is especially convenient if you own property in another state. Waiting for a check to come in the mail can be a burden. With ACH, that payment can be made next day from anywhere in the country.

Cheaper than a credit card

For ACH payments, there could be a small fee but these are typically only a few cents, no matter the transaction size. A credit card, on the other hand, can charge a fee of up to 3% on each transaction. Going back to our property manager example, if your tenant is paying $1,000 with a credit card, the fee could cost $30. If you have 10 tenants all paying this way, that’s $300 per month in credit card fees that you either need to absorb or pass along to your tenants. Either way, someone is not happy about this. Allowing tenants to pay with ACH keeps more money in everybody’s pockets.

If you are able to pay your suppliers and vendors with an ACH account, it saves money on ACH transactions as well. Some suppliers may even offer a discount if you are willing to pay via ACH transfer.

More secure than a check, credit card, and wire transfers

Using ACH is more secure than paper checks, credit cards or wire transfers. When you write a check, your business’s account number is right there for anyone with the check to see. If the check gets lost in the mail or ends up in the wrong hands, your account could be compromised.

With ACH, you can set up multi-factor authentication for added security. So, even if your computer is hacked, they won’t be able to move any money without completing a second security procedure.

Get Started With a Treasury Services Representative at Northwest Bank

To get started with ACH direct deposit services, you should connect with a treasury service representative at your bank. At Northwest Bank, we try to make your banking as easy as possible, and we can help you identify the benefits of ACH services.

Learn more about our treasury services and connect with a treasury services representative today to discover how ACH payments can improve the efficiency of your small business and automate payments.  

Small Business Financing for the Next Step

You’ve worked hard to build your business. Now make sure it continues to thrive. Local businesses are vital to the community, which is why helping yours grow is our priority.

Talk to a Business Banker Today                                                                                       

The Author

Sara Morrow

Sara Morrow

Loan Portfolio Manager

LinkedIn Email

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