With automatic ACH transactions, the biller initiates the charge and seamlessly in the background the money is withdrawn automatically from your account. This is ideal for monthly bills that don’t vary widely between billing periods, like telephone service, software subscriptions, and landscape maintenance. You can set up automatic ACH payments that happen on a recurring basis. Two institutions, the RDFI (Receiving Depository Financial Institution) and the ODFI (Originating Depository Financial Institution) help enable ACH processing, often involving banks and the Federal Reserve. Instead of writing a paper check, exchanging cash, or using a debit or credit card, the money moves from your account to the merchant’s account automatically-with your prior approval.

What Is an ACH Payment?ĪCH payments are electronic payments that pull funds directly from your checking account. Automated Clearing House or ACH payments are a convenient and easy way to do this. One of the easiest things a business can automate is the payment and billing process. Automating business processes and merchant services can help simplify things immensely for overworked entrepreneurs. This is especially true for small business owners leading growing companies. No matter what we try to do to combat it, life seems to get busier and busier with each passing year.

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