SMS Payments - Ach Payment Processing Solutions

Posted by ACH Payments on January 27th, 2021

The ACH network beginnings can be attributed to various associations forming NACHA in 1974. Rules were established for the various participants operating within the network to comply with. The  ACH SMS network began as a batch network and continues as such to this day.

The term payment gateway is generally used in connection with credit card processing. Around 1996 it was Jeff Knowles who was supplying merchant accounts to online retailers who were tired of PC software offerings that were available, and certainly didn’t want to key in card data into a stand-alone terminal. He reached out to First Data and obtained their lease-line specs to begin what would be the end result of the first payment gateway, authorize.net.

Today, a payment gateway is essentially communication connectivity through internet protocol. Because the ACH Virtual Terminal network is a batch network, authorizations that are possible in the credit card world are not possible for ACH transactions. So exactly what advantage can come about from utilizing internet protocol connections for ACH transactions?

First, you need to think of an ACH Payment Gateway a bit differently than what is a credit card gateway. You need to consider the ACH processing engine and what it does – and how real-time data flow from those processes can benefit an originator. For example: For security purposes, an ACH processor might have the ability to tokenize the sensitive bank account data. Real-time connectivity allows for an integrated software application to post customer and their associated bank account data and be instantly returned a reference token that replaces the bank account data, thus removing the threat of theft of sensitive data.

An  Look At This Site ACH processor might maintain a database of known fraudulent accounts or “bad accounts” that are routinely NSF, or closed accounts. Having a real-time notification delivered in these instances can be extremely beneficial to a merchant originator.