Offering your clients the ability to pay via recurring ACH can be a win-win situation. Not only are you providing your customer base with an efficient, convenient and eco-friendly payment option, but you’ll also likely experience reduced costs and increased customer loyalty.
Many of today’s organizations now offer recurring ACH as an option when agreeing to payment terms – especially in situations when there are service contracts, or any other type of account with regular or scheduled billing.
How can ACH benefit your business?
Automated Clearing House (ACH) transactions allow for direct account-to-account transfer of funds between individuals, businesses, financial institutions and government organizations. Recurring ACH payments are authorized by the customer, who then agrees to allow the vendor or service provider to initiate automatic payment from his or her bank account, all based on a previously determined schedule.
One major advantage of recurring ACH is how it can help businesses retain customers by removing the burden of frequent bill payment from consumers. In fact, according to one recent study, customers who use recurring ACH as a method of payment are 14 percent less likely to leave their current vendor and approximately 86 percent more likely to continue making their payments on time. Keep in mind, recurring ACH payments do require you to follow the guidelines established by Regulation E.
Here are a few other benefits of recurring ACH payments:
- It’s a convenient way to streamline payment process. Payments are set up on a schedule and automatically withdrawn from a customer’s bank account. This reduces many of the delays associated with traditional payment methods.
- The cost is significantly lower. Because ACH transactions are initiated directly between accounts, it eliminates the fees associated with processing and handling traditional-style payments. With ACH, you see significant savings, which can then be passed along to customers.
- Provides increased security. Since there are no physical pieces that require reviewing or processing, organizations can reduce security issues and risk associated with the acceptance of traditional payments, like paper checks.
- Reduces reliance on manpower. Recurring ACH payments are set up to occur automatically, freeing team members from manual entry and processing.
- It’s environmentally friendly. ACH payments are initiated and processed electronically, requiring no paper waste. This environmentally-friendly method not only reduces an company’s carbon footprint, but it can reinforce customer perception of your business.
BillingTree’s ACH payment-processing gateway offers an electronic payment-processing solution via the ACH Network. Call (877) 424-5587 today for more information.