The steps involved in online payment processing have significantly reduced the waiting period and hassle when purchasing commercial products and services. With new technologies and payment processes, people can easily buy products and past services, set up recurring payments, and streamline payments that allow sellers to accept new orders 24/7.
Many eCommerce payment processing services were far from intuitive and often costly in the past. However, today, dozens of reputable companies are pushing easy-to-use Entrepreneur Best Payment Processing that can handle credit card transactions, bank transfers, and real-time orders at a fraction of the cost. While there certainly isn’t a shortage of payment service providers for you to choose from, how exactly does online payment work? Let’s go through the primary steps.
Step 1: The buyer submits a payment request through their cell phone, computer, or mobile payment processor (i.e., SWIPE).
Step 2: The service provider routes the data via a secure connection to the buyer’s bank or credit card company.
Step 3: The buyer’s bank either approves or declines the transaction based on the buyer’s available funds or credit. If approved, the transaction is routed back to the payment provider to be processed.
Step 4: The payment provider stores the transaction and sends a record to the seller and buyer.
Step 5: The goods or services are sent to the buyer, and the buyer’s bank sends the funds to the seller.
How Comprehensive ACH Processing Saves Your Company Money
Automated Clearing House, or ACH, is an electronic network that facilitates financial transactions. Some of the most common uses for ACH include direct deposit, payroll, and vendor payments—making it a great option to process safe, secure, and affordable payments to staff, part-time help, freelancers, suppliers, vendors, and more.
What is ACH in Entrepreneur Best Payment Processing?
The US Government historically used sweet SuccessThe ACH network to make direct payroll deposits, pay government vendors, and forward Social Security benefits to recipients. In 1999, the Federal Reserve opened the ACH network to corporate use. While it was met with limited adoption initially, now ACH processes over 22 billion transfers annually, totaling nearly $40 trillion. Businesses utilize ACH payments to make direct deposits, process debits and credits between vendors, suppliers, and more. They may also use ACH services to make tax payments directly to federal, state, and local government entities.
How ACH Saves Your Company Money
You may be wondering how ACH transaction processing can save your company money. The answer is simple – electronic processing saves time, money, and resources by eliminating non-essential steps in the payment process. Additionally, you cut out the middleman from the payment process. Eliminating this unnecessary step saves your company time and resources and helps reduce the opportunities for fraud or theft.
In short, using an ACH processing service will save your company time and resources and save your company money.
Lower Costs
The most significant way ACH saves your company money is by lowering costs. Paper checks are expensive. On average, it costs $1.22 in supplies, work hours, and incidental expenses to process a paper check received for payment. The same payment can be processed using ACH for a fraction of that cost.
Savings on disbursing payments can be even more significant. Instead of producing and printing checks, signing checks, placing reviews in envelopes, paying for postage, and paying for labor, to deliver checks to delivery centers, ACH instantaneously and electronically deposits payments in recipients’ bank accounts—saving you time, money, and resources.
Does your business send wire transfers? These electronic fund transfers can cost $25 or more depending on the dollar amount. ACH transaction processing allows you to schedule and send funds electronically at a fraction of the cost, sometimes costing only pennies.
Better Cash Flow Management,
One of the most significant advantages of using an ACH processing service is the benefit to company cash flow. Receiving and disbursing payments can seem like a juggling act to many businesses. Waiting for a payment to arrive is not only frustrating. It can complicate cash flow and interrupt regular business.
With ACH payment processing, you can receive electronic payment from vendors on the payment date, eliminating the need to wait for a paper check payment to arrive in the mail. What’s more, you don’t have to wait for the check to clear. The electronic deposit is instantly removed and deposited into your account.
Likewise, sending payments via ACH improves cash flow management. Using ACH to make payments allows your company to hold and leverage funds up to the payment date. You can better manage and control your cash flow because you don’t need to account for payments that are out there for delivery.
Better Security
A great benefit of ACH transaction processing is the increased security over traditional check payments. By eliminating paper checks, you eliminate the possibility of check fraud. ACH removes the possibility of a check being stolen and dismisses the case of a check being lost. Because deposits are electronically made into the recipient’s bank account, there can be no question, and here and the funds are. Lost or stolen checks are a thing of the past, and deposits can be electronically verified the instant they are made. Overall, the ACH network provides a safer way to process payments.
Greater Flexibility
Scheduling payments, deposits, and credits can be a full-time job. ACH automates your recurring payments giving your payroll and accounting department more flexibility. Because regular payments are automated, it frees up time and resources for your staff to focus on other essential tasks—saving your company time and money. What’s more, ACH payments can be approved online, meaning last-minute payments can be managed and processed even if your account manager is out of the office. Payouts and payments can be supported from virtually anywhere at any time. ACH transaction processing gives your company greater flexibility, saving you time, work hours, and resources.
Go Green
Making environmentally friendly choices isn’t just good for business; it’s good for the planet. ACH processing eliminates the use of thousands of paper checks and their envelopes every day. That saves trees and reduces paper waste. What’s more, it eliminates the environmental impact of mail trucks delivering those envelopes to homes and businesses. Going green saves the planet and puts a little greenback into your business. It’s not just about saving the world, it’s about saving money too.
Save Money and Time With ACH
ACH is an incredibly reliable, efficient, and cost-effective way to process payments, payouts, deposits, and credits. Using an ACH processing service to manage your expenses will save you money by lowering costs, improving cash flow management, offering better security, and providing greater flexibility for your accounting staff. As a bonus, it helps you make environmentally friendly business decisions that help your bottom line.
With so many cost-saving benefits for businesses of all sizes, utilizing ACH transaction processing is an intelligent decision for your company. Stop sending and receiving payments the old-fashioned (and expensive) way, take advantage of ACH payment processing and save money for your business today
