In the past few years alone, we’ve seen a major shift from paper to electronic payment methods, and ACH is leading the charge. In fact, over 29 billion ACH transfers were sent last year —an 8.7% increase over 2020.

As ACH continues to grow in popularity, more and more small businesses are leveraging it for their payment operations. Whether they’re getting funds in or sending payments out, small business owners across the country rely on the ACH Network to make safe and reliable business transactions.

What is ACH?

ACH is an electronic, bank-to-bank money transfer processed through the Automated Clearing House Network. It’s quick and often free to send and receive, making it an ideal payment option for small businesses.

How long does ACH take?

Small business owners can choose between two options for ACH transfers: standard or same-day.

Standard: Standard delivery can take up to 3–5 business days, since ACH transfers are processed through the ACH Network in batches. Check your bank’s policy to see when funds are typically released to customers, as timing varies from bank to bank.

Same-day: Same-day ACH transfers are available with North One Accounts, as well as at most traditional banks, increasing the opportunities businesses have to send and receive money. Make sure to confirm your bank’s cut-off times and transaction limits so your transfer doesn’t get delayed.

North One is a financial technology company, not a bank. Banking services are provided by The Bancorp Bank, N.A., Member FDIC.

When to send ACH payments for business

Gone are the days of waiting for checks to clear. ACH transfers make sending and receiving payments that much easier. Here’s a few ways you can leverage ACH services for small business payments.

  1. Payroll

ACH transfers are perfect for small, regular payments—like payroll! Most businesses use a payroll provider to do this. All you need is your employees’ bank routing numbers, account numbers, and authorization as well as the type of accounts they use (checking or savings).

  1. Invoices

Businesses of all sizes prefer the convenience of paying their vendors and suppliers through ACH. It’s quick, easy, and low cost. Not to mention, sending money electronically is a lot more secure than paper checks.

  1. Bills

Just like invoices, monthly bill payments are made a lot easier with ACH. The processing fees are lower than credit card payments and faster than waiting for paper checks in the mail. Plus, the same-day functionality has your back when you (almost) forget to pay.

  1. Taxes

Small business owners can pay their taxes using ACH, too! Just make sure to check the IRS website to confirm the types of business taxes that can be paid this way. “IRS USA Tax Payment” will be shown on your bank statement as proof of payment.

  1. Account transfers

ACH transfers make it easy to move money from one bank to another. Some business owners operate with multiple accounts, and ACH lets them safely move their cash around without high processing fees.

Benefits of ACH processing for small businesses

If you’re considering using ACH for your business payment processing, there are several benefits to keep in mind. They include:

  • Convenience: ACH transactions are processed electronically, meaning you can say goodbye to bank lines and paper checks.
  • Security: ACH has the lowest fraud rate among the payment types. So, you can rest assured that your money is safe.
  • Speed: Delivery of ACH transfers generally takes between 3–5 business days, but same-day functionality has your back when you need it.
  • Cost: Depending on where you bank, ACH transactions are often free. If you are charged a fee, ACH transfers can still be more cost-effective than other payment methods like wires.

Get more control over your transactions

There are several ways small business owners can use ACH in their day-to-day operations, from paying the bills to paying their staff. Whatever the reason, the convenience, security, and savings associated with ACH make it easy to send and receive business payments on their busy schedules.

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