How to use Same Day ACH for your business.
Avoid late fees.The next time a due date sneaks up on you, Same Day ACH can help. If you realize payment to a vendor is due tomorrow, you could send payment through Same Day ACH to try to avoid a penalty. This is especially helpful when you need to make a tax payment by the deadline. Same Day ACH also allows you to set up a same-day payment option for your customers. This helps them avoid late fees as well, and you’re able to receive payment faster and provide a better level of customer service.
Issue emergency or special payroll.You value your staff, and paying them on time is important. When payroll is delayed or missed, you can use Same Day ACH to send payment that same day. For hourly staff, Same Day ACH makes it possible to issue payment directly after calculating payroll. For instance, if you finalize the payroll report on a Friday morning, you could submit a request by the Same Day ACH cut-off time and see it processed later that day.
Negotiate better pricing with vendors.Everyone likes to be paid as soon as possible. Being able to pay vendors the same day gives you a competitive advantage, and potentially helps you take advantage of discounted payment terms. You can pay closer to the due date, and as soon as you have the funds you need available. Same Day ACH gives you more flexibility and control over your accounts payable.
Talk to your banker.Sending Same Day ACH is not automatic. At some banks, you have to indicate which payments should be sent same-day. Banks are required to process payments more frequently, but they do not send all payments as same-day by default. To help offset the costs of increased processing, banks may charge a fee for Same Day ACH payments. Check to make sure you understand your bank’s Same Day ACH policy, as well as the actions required for sending payments through the ACH Network same-day.
Review your payments process.Evaluate whether your payments process aligns with Same Day ACH requirements. Does your accounting department aim to send payments before the Same Day ACH deadline? By adjusting your schedule, you could improve your ability to meet Same Day ACH cut-off times. Make sure your team is using the Effective Entry Date field correctly to ensure items are posted as same day items.
Identify Same Day ACH payments and vendors.Determine which companies should be paid through Same Day ACH and indicate any Same Day ACH payments. There are restrictions as some transactions are not eligible for Same Day ACH. These include international payments and any items above $25,000.
Strengthen risk controls.With same-day processing, the window between requesting a payment and sending the funds is smaller. You have less time to catch a payment that’s gone out in error. Be sure to tighten your control process to help prevent and catch errors before the request goes out.
Whether or not you use Same Day ACH, the good news is your payments are being processed more quickly. By making use of Same Day ACH, you can seize opportunities to improve cash flow at your business. It is important to start by talking to your bank to understand the Same Day ACH services that are available.
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