Your company’s payment process can have a much higher impact on your overall performance than is apparent. This is because paper checks are increasingly losing relevance, as they slow down the payment processing time and can become a hassle for businesses and consumers. In this era of digitalization, where competition is constantly increasing, a more convenient and cost-effective method of transferring financial payments is by using ACH transfers.
An Automated Clearing House (ACH) network has become the new trend in the world of payments as it enables the fluid movement of finances between two banks and allows your company to pay via direct deposit or direct payment. Moving to ACH transfers might be the right transformation your business needs. Here are four advantages of ACH for your business:
ACH payments are a much more reliable and convenient option when compared to paper checks. Your customers will have the opportunity to make a recurring or one-time payment through the ACH network, which saves them from the hassle of sending checks through the mail or carrying their checkbooks around. As a result, your company will be able to provide convenience to customers and save them resources that they previously used to make deposits at the bank after each deal. This method also reduces the risk of payments getting lost in the mail and prevents delays in receiving a payment from a customer, which can sometimes severely affect your cash flow.
Did you know that an individual spends an average of $4 to $20 when writing a substantial check? This includes all the costs associated with financial transfer through checks, including printing, authorization, payment initiation, and mailing expenses. Therefore, only accepting this costly method of financial transactions can result in dissatisfaction and lost customers.
On the other hand, sending ACH payments costs approximately $1 per transaction, making it a less expensive payment option than paper checks and saving your and your customers’ money.
Banks can process their electronic payments way before paper checks. Using ACH transfers will enable you to get paid faster, improving your company’s cash flow. ACH payments also eliminate the need for labor to handle the manual storage and organization of checks and payment records.
A single data breach is estimated to cost around $3.3 million in the loss for a company. Using ACH payments will allow your business to cut out on intermediaries and reduce the risk of data breaches, fraud, or tampering.
Customers today are more well informed due to the ease of access to information on the internet. However, customers are concerned about cyber security, fraud, and identity theft, but using ACH transfers is a way to ensure their valuable data safety. Information provided for the banking system is entered into an encrypted and secure database of the ACH network.
Information on paper checks can exchange multiple hands during the authorization, mailing, and deposit process. Meanwhile, bank account information entered on ACH is only exposed once and has comparatively fewer chances of getting lost or stolen. Money moves directly between two bank accounts, and federal law protects you from fraud and error in ACH transfers.
ACH network is revolutionizing the payment trends and is an ideal payment method, especially for subscription-based business models. It saves your company from the hassle of manual deposits’ risk of data loss and enables cost-effective and faster payment processing. Adapting to ACH transfers helps you gain competitiveness in this ultra-competitive age.