Accepting ACH Payments Comes with Responsibilities
Automated Clearing House (ACH) is a government-regulated electronic network through which financial institutions can transmit funds back and forth. The process is similar to credit cards, except that senders and receivers use bank routing codes instead of traditional 16-digit credit card numbers.
Enabling ACH payments offers important advantages to businesses and customers alike:
- Businesses are able to save both time and money by accepting ACH payments. Cutting paper-based checks is a huge drain on limited resources.
- Customers benefit from the convenience that ACH payments offer. This is especially true for direct deposit payroll and any payments that require recurring billing.
Everyone benefits since ACH payments are environmentally friendly. Because all transactions happen electronically, there's no need for material resources like paper, postage and ink cartridges.
Given these advantages, it’s not surprising that nearly $39 trillion was transferred throughout the ACH Network in 2013 (across 22 billion separate transactions).
However, before you enable ACH payments within your company, there are certain precautions you must take to protect both your business and your customers.
1. PCI-Compliant Data Security
The most important step requires building your ACH functionality around PCI-compliant security standards. These are the same “safety” protocols used for credit card processing. But because ACH provides direct access to bank accounts, PCI-compliance is even more important.
If you’re not sure what PCI compliance is (and don't know if your business meets the standards):
- Check out this useful resource on how to become PCI compliant
- Take this self-assessment test
2. Stored User Data
Another important consideration is how you choose to store user data.
Most companies simply create their own internal databases. But these are relatively easy to hack. In fact, data breaches happen all the time — especially among smaller firms that don't have the technical savvy or resources to protect sensitive information.
A better alternative is to consult with data security experts who can best advise you on privacy protection. This is one of the areas in which BluePay thrives. If you need help or have questions, schedule a free consultation with our data security team today by clicking the Get Started Today! button at the bottom of this page.
3. Educating Consumers
Another popular way that thieves obtain sensitive information is through email scams — especially phishing emails that are branded to look like official communications from your company.
Ultimately, it is the customer's responsibility to look out for email scams. But your company should invest some time educating users about the most common phishing tactics out there. Doing so will save you and your customers a lot of headaches down the road.
Making ACH Payments Work for Your Company
If you already have a merchant account and regularly accept credit cards, most of the above tips are probably familiar. Electronic payments are fast and convenient. But they also carry certain risks if you're not careful.
However, whereas credit cards add an extra safety buffer between thieves and bank accounts, ACH payments provide a direct link to sensitive financial information. As a result, the above safety precautions become even more important.
If you need help safely transitioning to ACH payments, you can find out more about ACH payments at BluePay here, or click Get Started Today! to have one of our experts contact you shortly.