High Risk ACH Processing

Short for Automated Clearing House, ACH is an intra-bank payment network used to send and receive funds electronically within the United States. Since launching in 1978, the ACH network has enjoyed exponential growth — largely due to convenience and cost.

Electronic payments sent through ACH are:

• Easier and faster to process than traditional paper-based checks
• Substantially cheaper than conventional credit card processing

Because of these advantages, current transaction volume over the ACH network exceeds $40 trillion annually.

However, many companies have difficulty qualifying for ACH processing because banks deem them as a high risk merchant.

Businesses in this category include:

• Startups or those with insufficient credit history
• Those in high risk industries
• Businesses with a history of payment fraud or abuse

Depending on the risk classification of your business, you may be tempted to explore alternative payment solutions such as offshore merchant accounts, instead of a high risk ACH account.

However, at Performance Card Service (PCS), we specialize in high risk ACH processing for businesses that might not normally qualify for payments through the Automated Clearing House network. In addition to sending and receiving electronic checks, our high risk ACH payment processing solutions enable your customers to use their debit and credit cards when making purchases.

If your business falls into one of the above risk categories, you can expect to pay slightly higher processing fees — no matter what payment solution you choose. Further, with high risk ACH payment processing, additional expenses are involved. Yet the benefits received make this payment method a worthwhile investment.

Below are just some of the advantages our high risk clients enjoy:

1. ACH Processing Opens New Markets. Many Americans don’t have credit cards. Nearly 40 percent report never using personal, paper-based checks. By not offering the ability to pay using electronic checks, you’re missing out on a huge pool of potential customers.
2. ACH Processing Improves Cash Flow. ACH payments typically settle faster than those made with paper checks. This is especially true once you factor in the time required to send physical payments by post or process each check by hand.
3. ACH Payments Are Cheaper to Process. Credit cards carry a range of fixed and percentage-based fees that can quickly eat into your profits. With paper-based checks, there are costs associated with materials, postage and time spent manually processing each payment. By some estimates, businesses lose more than $26 billion annually due to these hidden costs. By contrast, electronic payments across the Automated Clearing House network carry consistently low, flat fees — even for high risk ACH accounts.
4. ACH Processing Is More Secure. Whereas both credit cards and checks are prone to abuse, ACH processing requires establishing a direct link between the customer’s bank account and yours. As a result, ACH payments are less susceptible to fraud. You may also discover that the number of chargebacks, refunds and disputes decreases when using high risk ACH processing.
5. ACH Processing Simplifies Recurring Billing. There’s a reason so many employers use the ACH network for direct deposit. Because of speed, cost and convenience, this payment method is ideally suited for recurring expenses. When you enable high risk ACH processing in your business, your customers will continue buying from you with ease — month after month.