March 10, 2022
Average Read Time: 5 Minutes
Businesses and consumers have been drawn to ACH payments for multiple reasons, but the main one is because it's electronic—providing a faster, easier and safer way to pay and get paid.
While the use of ACH as a preferred payment option has been increasing in popularity since 1968, It wasn’t until the release of Same Day ACH in 2016 that it began to pick up steam.
Now, businesses can process all ACH payments the same day they're initiated, which means they can also access those funds the same day. This is an extremely advantageous benefit for effectively managing cash flow. Especially if you’re a small business owner.
It’s time for NetSuite users to start offering and processing ACH payments. And here is why.
NetSuite has become a fan favorite among small to medium-sized enterprises (SMEs) over the years, providing them with scalable, enterprise-grade accounting solutions.
One of NetSuite’s biggest selling points is its library of integrations for processing payments like ACH. By enhancing NetSuite’s capability with an integrated payment provider, businesses can grow quicker and more efficiently from the added flexibility.
It's easy to see how capabilities like custom workflows, automated payments, and streamlined receivables are appealing to SMEs, especially as consumer and business preference for ACH payments continues to grow.
So what are the benefits of accepting ACH with NetSuite? Let’s take a closer look.
For customers who prefer paper checks, ACH provides them with a more familiar and safer experience, which eases the transition to electronic payments.
Easier than writing a check and safer than mailing or depositing it at the bank, ACH also provides customers with the opportunity to make direct payments from their bank accounts without the use of a debit card.
But ACH is not only good for customers, it's also good for business. On average, it costs businesses about $170,000 each year to run paper invoices and 135 labor hours per week to issue and process them.
NetSuite automates the process of issuing, delivering, and processing paper checks — reducing human error. And since ACH is more secure, it helps to dramatically reduce the likelihood of fraud.
Turning on ACH capabilities using a solution like MerchantE for SuitePayments, makes it possible by allowing customers to pay with their preferred method, whether it's ACH, credit, debit or prepaid cards.
But the best part about using NetSuite to process ACH payments is the ability to set up one-time payments or recurring payments, helping you get access to your funds faster. Plus, it makes life more convenient for your customers as well. They can just set it and forget it.
By having all the financial tools you need conveniently in one place, you’re better able to manage your business.
While some ACH payments may lower processing fees, the real impact is in its efficiency. The fee for processing a check doesn't include the time, labor, or resources associated with issuing and processing a check.
This is a huge cost saving that can greatly improve your bottom line and one that can be attractive to businesses that may want to adopt an ACH-only payment environment. You can enable this in NetSuite by using an integrated payments provider like MerchantE. In doing so, you get the flexibility of being able to accept ACH payments without having to accept credit cards, which is often a requirement when you set up an account with many other payment processors.
We've mentioned the benefits of automation in reducing human error when issuing and processing payments, but there is also the benefit of streamlining workflows to improve efficiency and productivity.
Because of NetSuite’s automation capabilities, ACH transactions are immediately reconciled once payments are made. This removes the manual work of comparing deposits with orders, freeing you to focus on higher value-add activities like growing your business.
Accepting electronic payments like ACH can help to greatly reduce DSO compared to traditional payment options like paper checks. Think about it:
The act of creating, printing, and mailing a paper check already puts you at a disadvantage. That's because of mail float, or the days it takes for the paper check to travel from payee to payor.
Since it takes only seconds for an electronic payment to be processed, it significantly contributes to the reduction of DSO, ensuring you have your funds when you need them.
With overall ACH payments clocking in at 29.1 billion payments valued at $72.6 billion and Same Day ACH growing by 74% YoY in 2021, it's safe to say that ACH payments will only continue on an upward trajectory.
As you research, it is important to consider the recent announcement made by NetSuite that they will be retiring their ACH capability through Coastal Pay in May, 2023. This means users of NetSuite's ACH feature will need to find a replacement, like MerchantE, to continue offering ACH payments to their customers.
The key is finding the right integrated payment provider in NetSuite that can provide you with a flexible and centralized payment environment that also allows customers to pay how they want.
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