How to become an ACH payment provider

Automated Clearing House, also referred to as ACH, is a method by which merchants are able to obtain payment transactions from customers directly from their bank account without the processing of a paper cheque.  In order to become an ACH provider, individuals or companies need to complete a number of steps which include obtaining a merchant account.

For more information regarding online payment solutions and how to become a payment service provider, please Contact Us.

How to become an ACH payment provider

It is important to follow certain steps to become an ACH payment provider; these steps ensure that individuals and companies are in compliance with the law. ACH processing is monitored by and follows regulation outlined by the National Automated Clearing House Association. As ACH entails money being transferred directly from the customer’s account into the merchant’s account, it acts as an online equivalent of paying for goods and services by cash.

The method of becoming an ACH payments provider is complex. The following are the main steps of how to successfully become an ACH provider.

  • Choose merchant service providers (ACH Direct, Key Bank) which allow ACH processing options.
  • The application in order to open an ACH merchant account needs to be completed. Details regarding your business need to be submitted, such as company’s status, brief description, background etc.
  • Discussing the ACH needs of your company with the company web programmer and merchant service providers. Deciding whether the ACH payment solution should be implemented online, offline or both.

In the case that the business chooses to integrate ACH into their website, a specific code is provided which needs to be entered into their website. This will allow their clients to complete transactions through their site in a simple and easy way.

Lastly, companies are required to manually set up a processing system with their merchant service provider. This will enable them to manually enter customer’s bank details including account number and routing number in a secure portal to complete payments.