How to accept ACH payments as a business

Collecting customer payments shouldn’t be a chore or a hefty expense. ACH transfers can help you streamline your finances and skip the usual credit card fees. Though they may seem complex, setting them up for your business is easier than you might think.

This guide will walk you through how to accept ACH payments as a business, helping you prepare your infrastructure and get started easily.

What are ACH payments?

An ACH payment is an electronic bank transfer processed in batches through the Automated Clearing House (ACH) network, offering a cost-efficient alternative to wire transfers and credit card payments. Major brands rely on ACH for secure, low-cost electronic payments at checkout, and it’s commonly used for payroll direct deposits and automatic bill pay.

Accepting ACH payments is a smart, cost-effective way to collect client payments. In 2024 alone, businesses processed 7.3 billion B2B payments through the ACH network, an 11.6% jump from 2023, according to Nacha (formerly the National Automated Clearing House Association).

How do ACH payments work?

The ACH network allows businesses to receive payments electronically, bypassing the hassle of paper checks and the expense of credit card processing fees.

When accepting ACH payments, it’s helpful to know the difference between ACH debits and credits:

• ACH debit: A business pulls funds from a customer’s account, ideal for collecting payments
• ACH credit: Funds are pushed to another account, common for payroll or refunds

Understanding these options lets you choose the right method based on your transaction needs. For most businesses, ACH debit is the go-to for collecting payments. Here’s the typical process when a customer initiates a payment:

1. Customer authorization: The customer initiates and authorizes a payment from their bank account, either by filling out an online form or providing written consent
2. Payment request: The business submits the customer’s payment request to their own bank
3. Bank submission to ACH network: The business’s bank submits a digital payment file to the ACH network
4. Batch processing and transfer: The ACH network processes the digital payment files and sends them to the customer’s bank
5. Settlement and deposit: The customer’s bank releases money to the business’s bank account, typically within 1–3 business days

ACH payments are secured through bank-level encryption, multi-factor authentication, and strict compliance with regulations such as the Nacha Operating Rules, which mandate fraud monitoring, data protection, and transaction limits.

Financial institutions must also comply with federal regulations such as the Bank Secrecy Act and implement risk management procedures, including customer verification and suspicious activity reporting, to maintain the integrity of the ACH network.

Cost of ACH payments

ACH payments typically offer significant savings compared to credit cards, making them an attractive option for businesses looking to reduce payment processing expenses while maintaining reliable service.

ACH transaction fees generally range from $0.20 to $1.50 per transaction, making them considerably more affordable than credit card processing fees, which typically cost 2.9% plus $0.30 per transaction. For a $100 payment, you could pay around $0.50 with ACH versus $3.20 with a credit card.

Beyond transaction fees, expect additional costs such as monthly service fees ($5–$30), returned payment fees ($2–$5 per return), and potential setup fees. Some providers charge extra for same-day processing or premium features.

Several factors influence your ACH pricing. Higher transaction volumes often qualify you for lower per-transaction rates. Your chosen payment processor matters, too. Some specialize in ACH and offer better rates than general processors. Your business type and average transaction size can affect pricing as well.

ACH payment pros and cons

Like any payment method, ACH payments come with distinct advantages and drawbacks that can impact your business operations and customer experience in different ways.

Pros of ACH

• Cost-effective: ACH fees are low, typically ranging from $0.20 to $1.50 per transaction. That’s much cheaper than alternatives such as checks, ePayables, credit cards, or wire transfers (up to $35 domestically)
• Secure: ACH payments are highly secure and better-regulated than checks, reducing the risk of loss or theft. Unlike wire transfers, ACH payments can sometimes be reversed if an error occurs.
• Faster than checks: ACH transactions settle within 1–3 business days, with options for recurring payments to automate collections for subscriptions or ongoing services ‍
• Efficient: ACH payments are fully digital, cutting out manual processes such as handling paper checks or visiting the bank
• Recurring payment convenience: ACH works exceptionally well for subscriptions, memberships, and regular billing cycles, automating collections and improving cash flow predictability

Cons of ACH

• Processing delays: ACH transactions can take 1–3 business days to clear, unlike credit cards, which provide immediate authorization and faster fund availability
• Transaction limits: Banks often impose daily or monthly ACH limits that may restrict larger payments or high-volume processing needs
• Payment failures: NSF returns, closed accounts, or authorization issues can cause failed transactions, sometimes resulting in additional fees or potential collection efforts

ACH payments work best for businesses prioritizing lower costs and recurring payments, though the processing delays require careful cash flow planning.

How to accept ACH payments as a business

Setting up a processing system to receive ACH payments for your business is simple. Here are the steps involved:

1. Set up your business bank account: Open a business bank account at a financial institution that supports ACH transactions. Most banks offer this service, but it’s worth confirming the details.
2. Choose a payment processor: Select a payment processor or accounting software that allows you to set up ACH payments. Check their fees, services, and security protocols to find the best fit for your business.
3. Establish a merchant account: Set up a merchant account to access the ACH network and request payments from customers. Be prepared to provide details such as your business name, address, personal ID, business documents (e.g., license, operating agreement), federal tax ID, and estimated transaction volume.
4. Collect customer details and authorization: With your account ready, send customers an ACH authorization form to collect their bank details, including their name, bank name, account number, and routing number. You can also request an ACH debit directly through your payment platform. Verifying this information thoroughly helps to reduce ACH holds.‍
5. Integrate ACH payments into your payment system: Now, add ACH payment options to your payment setup, whether online, in person, or via invoice. Once a customer initiates payment, funds will transfer directly into your business account, typically within 1–3 days.

How to accept ACH payments online

For businesses that want to accept ACH payments online, the key is integrating with an online platform that supports them. While setting up your ACH payment system, make sure to:

• Choose a payment processor for online transactions: Select a gateway that can integrate directly into your online platform. Look for one that offers ACH as an option during checkout and can handle web-based payment authorizations.‍
• Provide an online authorization option: Make the ACH authorization form available electronically. Many platforms offer a simple checkbox for customers to authorize ACH at checkout.

How to accept recurring ACH payments

Recurring ACH payments are ideal for businesses that offer subscription-based services, memberships, or any billing cycle that requires automatic payments. Here’s what else to consider:

• Pick a processor with recurring payment support: Pick a payment processor that supports recurring ACH payments, so customers can authorize ongoing transactions with a single consent
• Adapt the authorization for recurring payments: Customize your ACH authorization form to cover recurring charges, including details such as billing frequency. This way, customers know exactly what they’re agreeing to up front.

How to receive ACH payments instantly (same-day ACH)

If you want to set up a faster ACH process, consider same-day or instant ACH. This makes transactions clear on the same business day, making it useful for time-sensitive payments:

• Select a processor offering same-day ACH: Choose a processor that offers same-day ACH to make sure funds are available within the same business day. However, keep in mind that these transactions usually come with higher fees.‍
• Set clear expectations with customers: Let customers know that same-day ACH is available for urgent payments. For invoices or time-sensitive purchases, make it clear that they can choose this option for faster fund transfers.

Best practices for accepting ACH payments

Setting up ACH payments correctly from the start saves time and prevents headaches down the road. These practical guidelines help ensure efficient operations:

• Verify customer information thoroughly: Always secure written authorization before processing ACH transactions, and double-check bank account details during setup to prevent failed payments
• Monitor return codes actively: Watch ACH return codes closely and establish clear procedures for handling returned transactions to address issues quickly
• Set up automated alerts: Configure notifications to alert you immediately when payments fail or require attention, enabling faster response times
• Use micro-deposits for verification: Offer small verification deposits to confirm account ownership and reduce payment errors before processing larger amounts
• Keep detailed records: Maintain comprehensive documentation of all authorizations and transaction histories to ensure compliance and simplify dispute resolution

Follow these practices consistently and your ACH payment system will run smoothly while keeping both you and your customers satisfied with reliable transactions.

How Ramp Bill Pay is the best way to streamline your business payments

Ramp Bill Pay is an AI-powered accounts payable system built to address the everyday hurdles finance teams face. From capturing invoice details and coding line items to scheduling payments and syncing with your accounting tools, Ramp automates each step, allowing you to spend less time on manual entry and more on closing your books efficiently.

Traditional AP solutions often suffer from inflexible ERP connections, unreliable purchase order matching, and fragmented processes. Ramp Bill Pay was designed to modernize the entire AP journey with fast, accurate, and adaptable automations, giving teams clear oversight and control from the initial invoice to the completed payment.

Ramp is recognized as one of the easiest AP automation software to use based on G2 reviews. Ramp’s modern finance operations platform maintains a rating of 4.8 out of 5 stars based on 2,000+ user reviews from the finance teams who depend on it.

Startups and large enterprises alike trust Ramp to cut down on repetitive tasks, catch costly errors before they happen, and keep financial data organized and accurate. One G2 reviewer even described Ramp as a great solution for small churches for overall expense management.

Why manual AP workflows fall short

Most accounts payable processes encounter slowdowns with:

• Chasing down approvals that get buried in email threads
• Resolving discrepancies between invoices and purchase orders
• Re-entering payment data into various accounting systems

Ramp Bill Pay addresses these challenges with a complete set of AP features:

• Comprehensive controls unifying AP, procurement, expense, and accounting workflows
• Intelligent invoice capture and GL coding powered by AI
• Automated matching of invoices and purchase orders
• Customizable approval flows with role-based routing
• Automated management for recurring bills, batch payments, and monitoring vendor payments
• Dual-sync ERP integrations with NetSuite, QuickBooks, Xero, and additional platforms
• Versatile payment options, including ACH, card, checks, and domestic or global wire transfers

More than 40,000 businesses, from small family farms to space startups, choose Ramp for superior AP management and transparency. Recent success stories include:

• Hospital Association of Oregon reducing bill pay processing time from 10 hours per AP batch to just a few minutes
• Sandboxx saving 10 hours per month by consolidating expense management and bill pay in one solution
• The Second City processing bills 2x faster with accurate OCR

Why do teams choose Ramp Bill Pay over other AP solutions?

Ramp Bill Pay sets the standard for modern AP software. With advanced automation, robust ERP integrations, and user-friendly workflows, Ramp empowers finance teams to process invoices with greater speed and accuracy, delivering results you can trust with every transaction.

You can get started on Ramp for free, then upgrade to Ramp Plus for just $15 per user per month. Custom enterprise pricing is available as well on request.

Experience what top-rated AP automation should feel like. Get started with Ramp Bill Pay.

This post includes general information about ACH payments. For help with ACH functionality specific to Ramp, visit Ramp Support for more details.