Things you must know about ACH processing

Posted by maryparker on September 20th, 2012

ACH service or automated clearing houses are for business entrepreneurs who deals with clients not from his/her country alone but from  any place in the world and the payment is in different currencies. ACH processing helps the vendors and their clients to receive and make payment effortlessly without bothering about postage, delays or conversion of currencies. And moreover the process is perfect and reliable. But, you must follow certain precautions while choosing the service providers for the automated clearing.

In the simplest sense ACH processing is just like your credit card processing. And, therefore, it can pose all the risks that the credit card processing may involve. ACH services are used for a range of functions like direct deposit for the pay of employees, business-to-business or corporate transactions and common e-commerce purchases. An employer may choose ACH for transferring money directly to his or her employees’ accounts. This eliminates the hassle of traditional paper check deposit and the delay associated with its processing. It also helps a business to expand its customer base where it can cater to clients from any corner of the earth. And this can include those who do not use credit or debit cards.

Individuals can use several ACH services for paying mortgage bills, utility bills loans or insurance premiums. It also reduces the chances of delay in making the payment for recurring payments and ACH processing companies nowadays present advanced tools and APIs for complete account management. But, one should be careful while dealing with ACH methods. These types of payments must always be authorized by the account holder. But in case of fraudulent transactions funds are transferred into the accounts which are unauthorized. This happens when one manages the detail of the account holder’s account number as well as the bank routing number. Then funds can be used for fraudulent activity. This in turn causes huge loss for the consumers and the provider.

Therefore one should always be careful while dealing with ACH services and should do business with companies that are associated with the official governing organizations. The most common method to obtain the bank details and other sensitive information is through phishing emails. While replying through ACH processing company mails one should look for every detail very carefully. For example, the logo may closely resemble the original company’s logo and color scheme of the website presentation.

The email may appear to be completely official and coming from a friend or a person you know and may ask you to divulge private information like account numbers, your user names and passwords. In some case it may ask you to follow a link that leads you to enter your information. A reliable ACH service company will however adopt all measures to stop these types of fraudulent activities. In these cases ACH processing seems to be complex initially because of several steps for security adherence but in long run proves to be beneficial for the clients.

An ACH processing company will never ask for the clients’ sensitive information over a simple email. Monitoring ACH services closely and implementing all security protection methods are critical for saving money and protecting your business.

ACH services can expand the horizon for you provided you choose the right ACH processing company.