If you’re a business owner who has to process lots of payments, you may have heard of ACH payments before. ACH payments are cleared by an independent network of U.S. clearing houses and allow business owners to process recurring billing much more efficiently and safely both for them and their clients. They also cost a lot less to process. But are they for everyone? Let’s take a look at what kind of businesses should use ACH payments, and which ones shouldn’t.
Subscription-Based Online Services
If you offer any type of subscription-based service, you might want to consider ACH payments. They are especially great for businesses that offer very expensive services. SaaS businesses that offer premium products come to mind. ACH payments can also be used by streaming services or online publications that use a paywall, for instance.
All outsourced services should consider adding ACH payments as an option and making it their primary choice for payments. Accepting payments with checks, or even worse, credit cards, is very dangerous in that field. Fraud is rampant and it can be easy for a client to switch their credit card information to dodge you. But they’re much less likely to switch bank accounts. ACH payments will remove much of the guesswork that comes with collecting these payments.
If this is the field of business you’re in, Yodlee ACH payments can help. Yodlee ACH payments are cleared within one day or the next. They also verify your clients’ banking information on the spot, and you’ll only have to ask for their information once instead of you having to verify every check they send.
Establishments like spas and gyms can also benefit from ACH payments. Payments are processed fast and can only be cleared if the client has the money in their bank account, eliminating all fees related to invalid payments. This allows owners to focus on offering the best service to their clients instead of constantly obsessing over them. Healthcare providers who have to collect fees out of pocket, even if they’re not recurrent, can also use ACH payments.
Law firms are prime candidates for ACH payments. One of the best things about them is clients only need to submit their information once. From then on, recurring or one-time payments can be collected immediately from the client’s bank account. You will be notified of failed payments immediately and it reduces processing fees too.
ACH payments usually make sense for businesses that accept payments through checks. So, while they may make perfect sense for someone like a consultant or a managed IT service, they don’t make much sense for a restaurant or hospitality business. These businesses, however, could use ACH to make orders with suppliers and other B2B businesses.
ACH payments are a very convenient way to set up and collect recurring payments. If you’re in a line of business that can benefit from them, consider them as an option today and ask an expert if they would be the best option for you.