In this day and age, payment methods can take many forms. In general, customers as well as merchants are well familiar with conventional payment options such as cash, checks, credit, debit and prepaid cards. So what is ACH payment processing, and why is it increasingly gaining popularity among businesses in so many industries?
Presented below are three main factors that we managed to identify:
ACH Payment Processing is Much Cheaper than Traditional Payment Methods
Many businesses of all sizes and commerce are opting for ACH payment processing for the singular and most important reason, it is the most money saving option for electronic transactions available. Unlike the traditional payment methods such as credit cards, nearly all ACH payments operates in a “flat fee per transaction” structure. Allowing the cost per transaction to be significantly lower. The savings accumulated from utilizing ACH payment processing may be used for more advantageous purpose, such as stabilizing the price of goods and services.
Low Entry Barrier for All Types of Businesses
For merchants to ensure a smooth and universal payment procedure, they should gain approval from credit card partners and ACH payment processor. Frequently, companies will gain authorization to take ACH as payments, but not debit or credit card payments.
Businesses tend to utilize ACH payments in smaller capacities because it is generally a lesser-known payment method. For merchants who are familiar with ACH processing, often reckon it to be the most optimal payment option for their customers. Many businesses now discover that ACH payment processing is so convenient as well as cost efficient. Some merchants who were originally primarily relying on credit card payments are now making a switch to ACH payment processing as their main form of transactions.
Security Enhancement for Both Ends
Some customers might not feel safe about giving their bank account details to a merchant over a telephone conversation as it may compromise their financial security. Nevertheless, what most people fail realizing is that usually their bank-account information and unique routing number are printed on the bottom of most paper checks. In the age of digital fraud, we’ve all been trained and educated to always keep our bank cards safe. However, most people fail to realize that whenever a check is utilized, a person is actually subjected to an increased risk than by giving a business owner their bank details over a phone conversation.
The probability of a check getting stolen or lost while it is being stored at an office or during transportation is actually higher. By adapting to ACH payment processing, merchants are able to mitigate these type of hazards for both the business itself as well as for their customers.
By accepting ACH payments, your customer’s account details are encrypted and entered immediately into a secure system. This implies that sensitive customer data will never be jeopardized as the encrypted information are all transferred by a fail-safe and highly secure computerized system.