You've probably heard the term "ACH" or "bank payments" and wondered exactly what it means for your business. At Helcim, ACH bank payments are a way for you to accept funds directly from your customer's bank account and have them deposited into yours. Think of it as a modern, electronic version of a check, but faster and with less paperwork!
This article will give you the lowdown on Helcim's ACH payments: what makes them different from credit card transactions, the advantages they can offer your business (hello, lower fees!), a few things to keep in mind, and a clear look at our pricing.
In this article
What are ACH payments with Helcim?
ACH stands for Automated Clearing House, which is a U.S. network for processing electronic financial transactions. When we talk about ACH payments at Helcim, we're referring to a payment method that allows your business to collect funds by directly debiting a customer's bank account.
| For Canadian businesses, you might also hear these referred to as Electronic Funds Transfers (EFT) or Pre-Authorized Debits (PADs) – they function very similarly within our system. |
Essentially, instead of your customer handing over a credit card, they provide their bank account details (with proper authorization, of course!), and the payment is processed through the ACH network.
How ACH differs from credit card payments
While both are ways to get paid, there are a few key distinctions:
Payment rails: Credit card payments travel through card networks (like Visa or Mastercard). ACH payments move directly between bank accounts, using the ACH network in the U.S. or Payments Canada for Canadian EFTs.
Processing & deposit time: Credit card funds often show up relatively quickly. ACH payments typically take a bit longer – usually 3-4 business days for the funds to be deposited into your bank account after the transaction is successfully processed and settled. This is due to the batch processing nature of the ACH network.
Cost: Generally, processing ACH payments is more cost-effective than credit cards, which often come with higher percentage-based fees. We touch more on our ACH fees here.
Information needed: For credit cards, you need the card number, expiry, CVV, etc. For ACH, you'll need the customer's bank account number and routing number (or institution/transit numbers in Canada), plus their authorization.
The good stuff: Benefits of using ACH payments
So, why consider ACH? Here are some compelling reasons:
Lower processing costs: This is a big one. Our ACH payment rate is just 0.5% + $0.25 per approved transaction, and that fee is capped at $6 for transactions under $25,000. This can mean significant savings, especially on larger payments.
Great for recurring payments: ACH is a fantastic fit for subscriptions, memberships, retainers, or any regular, ongoing billing. It's often more stable as bank accounts don't "expire" like credit cards do, reducing payment failures.
Less paperwork, more efficiency: Say goodbye to chasing paper checks or manually entering payment details repeatedly. Digital authorizations and processing streamline your accounting.
Convenience for customers: Many customers appreciate the option to pay directly from their bank, especially for bills or larger invoices.
Things to consider: Potential drawbacks
While ACH is great, it's good to be aware of a couple of things:
Slower deposit times: That 3-4 business day window for funds to arrive means ACH isn't ideal if you need the cash in your account instantly. Plan your cash flow accordingly.
Potential for returns: Like a check can bounce, an ACH payment can be "returned" for reasons like insufficient funds (NSF), an invalid account number, or if a customer revokes authorization. We'll cover returns in detail in another article, but it's a key characteristic of ACH.
Navigating ACH disputes: ACH disputes can be trickier than credit card disputes due to different rules and fewer formal appeal options. Resolving issues directly with your customer is often essential.
ACH in your Helcim account: A quick peek
Integrating ACH into your payment tools with Helcim is straightforward. You'll be able to:
Enable (or disable) ACH payments in your main Settings.
Offer ACH as a payment option on Invoices, through Payment Pages, and for Payment Requests.
Set up Recurring Invoicing and Recurring Payment plans to bill via ACH.
Process ACH payments through the Virtual Terminal.
| We dive into the "how-to" for using ACH in your payment tools in this article. |
Keeping it simple: Helcim's ACH payment fees
We believe in transparent pricing. Here’s what you need to know about our ACH fees:
Processing fee for ACH
For every approved ACH transaction, the fee is 0.5% + $0.25.
| Not sure how that breaks down? For example, if you process a $100 ACH payment:
|
Fee cap for ACH
For transactions under $25,000, this fee is capped at a maximum of $6. So, even on a larger payment, you won't pay more than $6 in processing fees.
| Want to process more than $25,000 in a single ACH transaction? Please reach out to the Helcim Support Team to discuss options. |
Fees for returned (declined) payments
If an ACH payment is returned by the bank (for instance, due to insufficient funds or an incorrect account number), there is a $5 fee. This fee is passed onto you from the banking network.
Fees for customer refunds
When you refund an ACH payment through Helcim, the original transaction fees are not returned (this is standard across the industry for both card and ACH payments). There isn't an additional Helcim fee to simply process the refund action itself, but the cost of the initial transaction remains.
| For full details on how refunds work, please see our article on refunding or voiding ACH payments. |
Next steps
Feeling a bit more familiar with ACH now? Great! The next step in understanding how ACH can work for your specific business is to learn about the nuances if you serve customers in both the US and Canada.
| Read next: ACH for US vs. Canadian merchants. |
FAQs
Are ACH payments secure?
Yes, ACH payments are processed through a secure network. Helcim also ensures that obtaining and storing bank information is done securely and requires customer authorization for debits, adhering to industry standards.
Is there a minimum amount for an ACH transaction?
No, you can process very small amounts if needed (though keep the 25¢ fixed fee in mind for very tiny transactions).
Can I offer ACH as the only payment option for my customers?
Yes, you can configure some of your Helcim payment tools to accept ACH Only. However, also consider your customer preferences: offering choices (like ACH or Credit Card) can often lead to a better customer experience.
| If you're using Helcim Fee Saver, you'll be set up to offer both. |
How is an ACH payment different from a wire transfer?
Wire transfers are generally processed in real-time and are good for urgent, often larger, international payments. They usually come with higher fees. ACH payments are processed in batches, take a few days, and are significantly more cost-effective for routine domestic payments.