What Is an ACH Payment? ACH Payments & Transactions for Small Businesses - Housecall Pro
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What Is an ACH Payment? ACH Payments & Transactions for Small Businesses

Pro Using Card reader for flexible Payment option

As a small business owner, a reliable payment system is critical for accurately and efficiently processing customer payments. And from a customer standpoint, it makes a big difference when there’s a convenient, professional system to pay for products or services rendered. That’s where ACH payments come in. 

What Does ACH Stand for in Banking?

ACH (Automated Clearing House) payments, also known as direct transfers, allow customers to transfer funds directly to you from their bank account. At just 1%, the processing fee for ACH payments is more secure than a paper check. Plus, you’ll get your money as soon as the next business day. For details click here. This is especially true if most of your customers choose to pay via credit card because, on the business end, you’re paying a percentage of the total payment in addition to a fee per transaction.


About 77% of consumers prefer to pay by card over cash, meaning you could be losing out on a quite a large chunk of money.  Alternatively, you can ditch the hassle altogether and embrace the unique benefits of ACH payments.

Keep reading for an overview of ACH and how it can be a boon for your service business. Or, jump to the relevant section below that directly answers your question.

What Does ACH Stand for in Banking?

ACH stands for Automatic Clearing House (ACH) network. It’s an electronic payment system run by the National Automated Clearing House Association (NACHA) which moves money and information from banks through Direct Deposit and Direct Payment ACH transactions which include:

  • ACH credit
  • ACH debit
  • Both recurring and one-time payments 
  • Government payments
  • Consumer-to-business transactions
  • Person-to-person transactions (such as Venmo)
  • Business-to-business transactions
  • International payments

In Some States

Annually, this system moves a ton of money

  • $41 trillion moved per year via electronic financial transactions
  • $24 billion electronic transactions processed per year

It’s considered one of the safest and most dependable payment systems globally and has been around for over 40 years. Originally, it was conceived as an alternative to paper checks in the 1970s and now thrives as the most dominant electronic payment system. In fact, it’s responsible for 90% of electronic payments—and it might be high time for you to get behind it, too.

How does ACH work? 

An “originator”—which can be a bank, government department, person, agency, or company—begins a direct deposit or direct payment through the ACH network. The originator’s financial institution, formally called the originating depository financial institution (ODFI), groups the transaction with other ACH payments or deposits, which are then sent out at a given interval.

Difference Between ACH and Wire

What’s the Difference between ACH and Wire Transfers?

As a business owner, you’ve probably come across wire transfers. If you’re curious about the difference between wire transfers and ACH payments, take a look at our comparison below: 

Transfer Speed 

  • ACH payments typically take 1-2 business days to complete. Some ACH payments are subject to review, which may prolong their processing time to up to 5 business days. Learn more.
Wire transfers: 
  • Usually within one business day
  • Proceeds typically available the next day after or, sometimes, same-day
  • The process is automated but depending on the bank, a bank employee sometimes needs to review wire transfers before placing funds into a particular account 
  • International wire transfers can take an extra business day or two


While both ACH and wire transfers are relatively safe, getting a wire transfer returned after it’s been sent out is incredibly difficult. With ACH, on the other hand, is much easier to reverse payments. For example, if you were to accidentally overpay an employee, you would be able to remove the money from the account. 

Note: There’s a reason why you hear about wire transfer scams so often; con artists like that “Nigerian prince” or “long-lost cousin” who sent you a fake email try to take advantage of the relative ease of wire transfers. Millions are scammed out of money each year. 

It’s important to remember that with both forms of payment, you’re using sensitive information such as your bank account numbers, your routing number, and other data you don’t want to get in the wrong hands so make sure you trust the recipient. 


  • Money is transferred to or from your account or directly to or from the other accountholder 

Wire transfers:

  • Sending money: Funds have to be available before the bank processes the transfer; as the financial institution processes the transfer request, the money is immediately removed
  • Receiving money: The individual receiving the proceeds can immediately withdraw the funds as soon as the payment is credited to the account

Wire transfers are typically only used for large money amounts like making a down payment on a house. A wire transfer guarantees to a seller that you can actually make good on your intent to pay. ACH payments, on the other hand, are better for smaller but more common payments like direct deposit paychecks, automatic billing, and 401k contributions.

What’s the Difference between ACH and Credit Card Payments?

The main difference between transferring money over the ACH network versus using credit card payments is the real-time guaranteed funds. With credit card companies like Visa, for example, the company verifies if somebody is within their credit limit and after the network approves the transaction, that money is then guaranteed to the company or merchant.

An ACH transaction is a request for funds that are batched together with other ACH transactions and sent out to be processed. The main benefit of ACH is that it’s lower cost compared to credit card processing fees.

Benefits of ACH Payments

How ACH Payments Help Businesses

There are several business-specific benefits of ACH payments. They’re secure, relatively cheap, and facilitate the process of recurring payments. Using ACH payments is one of the best money management tips for service businesses you can use for your own company. Let’s dive into the details of how they can specifically help your business below.

  • Secure, easy to handle: If a customer pays with a check, there are a couple of possible hiccups that could happen along the way. Businesses must wait for payment in the mail and then take an additional step to deposit the check at a financial institution. In between all of those steps, payments can get lost, and then you usually have to manually enter the information from the checks into your bookkeeping accounts. Electronic payments via the ACH network arrive reliably and quickly. It also saves you the hassle of an extra errand to the bank and you won’t have to deal with a check bouncing. 
  • Remote payments: Although this is true for using a credit card as well, businesses can accept remote ACH payments. This is a particularly handy solution for avoiding issues with customers who don’t want to send out their credit card information.

How ACH Payments Offer Better Payment Options for Customers

On the other side of the spectrum, customers also benefit from ACH payments. If you’ve ever forgotten to pay a bill or forgotten to pay a recurring fee, then you know that there’s nothing more annoying than receiving a late fee. When you automate the process by using ACH payments, you don’t have to think twice about regularly paying for your bills.

  • Simple payment system: You don’t have to write a check, reorder checks, or worry about when they’ll run out. Customers paying by ACH also don’t have to worry about getting checks on time in the mail or risk being late on their bills. Plus, they won’t be charged on their credit card and have to pay it later; the funds simply come out of their account.
  • Recurring payments: This is one of the main benefits. ACH payments allow customers to automate the bill-paying process. It’s time to say goodbye to alarms and written reminders—the money is conveniently withdrawn straight from an account without any
  • Convenience: Without having to worry about how cumbersome checkbooks or checks can be, ACH payments offer a level of conveinece and flexibility. You’ll have the option of making payments one time or setting up recurring bill payments.
  • Electronic payment records: With ACH payments, you have the option to pay your bills electronically. Transactions like direct deposits and automatic bill payments help transferring money and keeping up with bill payments easier.
  • Security: With paper checks being the most vulnerable to fraud, ACH payments are the easier and more secure choice. Since they can’t be lost in the mail, ACH payments reduce fraud and tampering risk.
  • Speed: Since ACH payments don’t have to be sent through the mail, they’re the faster option. Customers may trust ACH payments rather than using paper checks to make payments.

Types of ACH Transactions

ACH Credit

How it works: Payer starts the payment through their financial institution and electronically transmits the payment through the ACH network to the recipient’s bank account. You can both receive money or make payments with ACH credit.

Alternatively, an ACH deposit allows a customer to deposit funds directly into your business bank account.               

When you choose to have your IRS or state tax refund directly deposited into your bank account, this is also an example of an ACH credit. 

You can also be on the other end and make payments by ACH credit. Business owners, for example, can use an ACH credit to pay state taxes. You simply need to authorize your financial institution to transfer a specified payment amount from your bank account to the state government.


Examples of ACH credit: Direct deposits for any government benefits, tax refunds, or earnings you receive and, for some, tax payments you might make.

ACH Debit

This debit occurs when you authorize a department, agency, or company to take money straight from your account, typically on a recurring schedule. In this case, your bank doesn’t start the transfer process. Instead, you’ll sign up with the company or agency you are paying for services or products. 

Examples of ACH debits: Utility payments, credit card payments, and other common bills like health insurance, mortgage payments, or subscription services.

To authorize an ACH debit, the company you’re paying will need access to your account number and receive permission to take money out of your account on the previously agreed upon schedule. California and Michigan are two states that allow an ACH debit option for business owners to pay their taxes.

ACH Deposit

An ACH deposit is an electronic transfer of money that occurs between different financial institutions.

How-Do-You-Accept-ACH How Do You Accept ACH Payments

Curious how you can use ACH payments to benefit your own business? Housecall Pro offers several ways customers can choose to pay you that are quick and easy for both you and your client.

In order to accept ACH payments, you will need a bank or a separate ACH processor. If you want to save money, choose a processor that charges a flat fee for ACH instead of a percentage-based fee. Your best answer to settle ACH payments and other options? Housecall Pro.

Housecall Pro Features

You can think of Housecall Pro as your small business dashboard that’s capable of processing ACH payments and much, much more. It has features that can assist you before a job, during a job, and after a job.  Need to pay contractors? Contractor payments by Housecall Pro are simple and easy. Does a customer need to change their appointment? This software lets you easily update jobs on-the-go. There are plenty of additional features you can use to streamline your workflow.

Before the job: 

  • Scheduling made simple: Create and edit your schedule right from your mobile device or PC. Keep all of your employees updated with notifications related to their jobs sent directly to their phones. 
  • Online booking: An easy, online booking system encourages potential customers to choose you over the competition. Now they can schedule an appointment or service job 24/7 online so you can book jobs while you sleep.

In the field: 

  • Dispatch your technicians: Set up recurring jobs, assign teams, and schedule out arrival windows so customers stay informed. Changes made to any jobs will change and update in real-time across everyone’s device so all of your team members are always on the same page.
  • On-my-way notification texts: Create a consistent, reliable communication base with customers.
  • Live Map GPS: See where your employees are at all times and schedule the closest tech to go out to a job. This helps save time and creates an overall more efficient business model.
  • Custom text and email: Keep your customers in the know during the job to build trust and create repeat customers. If an unexpected issue comes up, it’s simple send out a custom message with an updated invoice.

After the job: 

  • Invoicing: Invoice and send estimates automatically. Just one click and you can collect payments from customers in a timely manner. Bookkeeping has never been easier.
  • Follow-up: Provide the ultimate customer service experience from start to finish. When you’re done with a job, create an incentive for the customer to come back with automated email marketing and postcard marketing. 

Housecall Pro Payment Options

Convenient payment options aren’t just helpful for your customers so they can pay for your services in a timely manner, it’s also helpful as a business owner because you don’t have to use several different apps to send invoices and receive payments. 


ACH payments give your customers the option to pay straight from their bank account without the hassle of paper checks, wire transfers, checks, or cash. They’re electronic, meaning they’re faster and much more reliable than checks. Saving you from affecting your bottom line.


  • 1.0% per transaction

Processing Time

  • 1-5 business days

ACH and other options for payments to enhance your business

Easy payments for services can help streamline your business and add an extra layer of professionalism to your company. These days, customers expect quick and efficient payment processes. With ACH payments, you’ll have peace of mind while delivering the best possible experience for your clients. With Housecall Pro’s services and options for payments, you can please everybody, from those who want to pay a traditional way with a check to those who want more modern, convenient options.

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Housecall Pro
Solutions for your business Whether you need to improve dispatching, reduce paperwork, increase workforce or grow revenue, we have a solution.

Housecall Pro

Solutions for your business Whether you need to improve dispatching, reduce paperwork, increase workforce or grow revenue, we have a solution.