Small business owners often find that they miss out on better deals. This is true in many cases such as not being able to order large amounts of stock, therefore missing out on the very best pricing. However, it doesn't always have to be this way; there are some things that you can do to get the very best possible start in a new business or to cut costs in an existing business.
In this article, we will explore ACH payments. ACH payments are an alternative to traditional wire transfers. There are many benefits of using ACH payments in your business and we will look into just a few of them here.
ACH stands for automated clearing house; essentially, it means payments are sent in bulk to a middleman rather than being dealt with in-house by your bank individually and makes for a unique payment solution that has some fantastic benefits.
1. Lower Cost
ACH payments cost a lot less to process than a traditional bank transfer. This is primarily because payments are processed in bulk rather than individually. So, while they can take a little bit longer than a traditional wire transfer, the cost is significantly reduced.
A wire bank transfer can cost around $30 to send. In comparison, an ACH payment will cost up to $1.50 and a lot of the time is actually free. This means that if you are a business that sends a lot of payments or you are a business that has a lot of regular outgoings to the same person, then ACH payments could be an extremely cost-effective way of you sending that money.
You may be wondering what the catch is here. The only downside with ACH payments is that they tend to take a little bit more time to clear. Whereas a wire bank transfer is usually instant if you are sending it within the same country, an ACH payment can take a handful of days to complete.
2. Safety
ACH payments are considered one of the safest forms of payment because they are easily reversible during the processing stage, unlike a traditional wire bank transfer. This means that if you feel that you have mistakenly sent a payment, then you can simply have the payment reversed. This is a huge benefit because, with a wire bank transfer, the payment is usually instant and already with the recipient before you would be able to do anything about it.
If you would like to learn more about ACH payments, check out Envestnet | Yodlee ACH Payment Solutions which offer a vast array of financial solutions to suit most businesses, small or large. Envestnet | Yodlee ACH payment solutions use account verification for an extra layer of security.
3. Greener Alternative
ACH payments are entirely digital from start to finish, which means checks, paperwork, envelopes and even stamps are no longer a requirement. This not only saves money on these consumables but is also much better for the environment!
Conclusion
In short, ACH payments are very beneficial to any business and have very few drawbacks. This is one great way that small businesses can even the playing field and get a great deal just like the big businesses do.
