How to Make ACH Payments Online: A Complete Guide for Businesses and Consumers

Posted on November 21, 2025

Are you ready to simplify how you move money? Automated Clearing House (ACH) payments make it easy to transfer funds directly between bank accounts—securely, quickly, and without the hassle of paper checks or card fees. The ACH Network backs these transactions, and it’s becoming the go-to choice for businesses and consumers alike.

In this guide, we’ll break down what ACH payments are, why they matter, and how you can start using them with CSG Forte.

How to make an ACH payment online

To make an ACH payment, you typically need the following information:

Bank account details: You will need the bank account number and the routing number of the account from which the funds will be debited.
Authorization: Depending on the nature of the ACH payment, you may need the recipient’s authorization to initiate the transaction. This is common for recurring payments or when debiting funds from another individual or business account.
Payment amount: You must specify the amount of money you wish to transfer through the ACH payment.
Payment purpose: Indicate the purpose of the transaction, whether it is for a bill payment, payroll, business transaction or another appropriate category.
Payment processing method: Determine the method through which you will initiate the ACH payment—this can be done through online banking platforms, payment processors or specialized ACH service providers.
ACH processing information: If you are initiating the ACH payment through a third-party service provider or a payment gateway, you may need to provide additional information such as the provider’s name, account details and any required authentication credentials.

Options for making an ACH payment

When it comes to making ACH payments, there are two primary methods—ACH debit and ACH credit:

ACH debit: ACH debit involves initiating a payment by granting authorization to a recipient to pull funds from your bank account. This method is commonly used for recurring payments or one-time payments where you provide your bank account information to the recipient. Examples of ACH debit transactions include utility bill payments, mortgage payments and subscription fees.
ACH credit: ACH credit involves pushing funds from your bank account to the recipient’s bank account. In this case, you are the one initiating the payment and providing the recipient’s bank account information. ACH credit payments are commonly used for various purposes such as payroll direct deposits, vendor payments and tax refunds.

How do I make an ACH payment?

You can send ACH payments online via an ACH debit payment or an ACH credit payment.

How to make an ACH debit payment

Follow these steps regarding how to do an ACH transfer via debit payment:

Gather recipient information: Collect the necessary recipient information, including the recipient’s name, bank account number and bank routing number.
Verify sufficient funds: Confirm that you have sufficient funds in your bank account to cover the ACH debit payment amount. Insufficient funds can result in declined transactions and potential fees.
Choose an ACH debit method: Determine the method you will use to initiate the ACH debit payment—you can do so through online banking, a payment processor or specialized ACH service providers. Check with your bank or chosen service provider to understand the specific process for initiating ACH debit payments.
Provide authorization details: Depending on your chosen method, you may need to provide the recipient’s bank account and routing numbers, along with the payment amount and any additional information required by the service provider or platform.
Initiate the payment: Follow the instructions provided by your bank or payment provider to initiate the ACH debit payment. This may involve logging into your online banking account, accessing the payment section and entering the necessary payment details.
Confirm and review: Before finalizing the transaction, review the payment details to ensure accuracy. Verify the payment amount, recipient information and any additional information required for the transaction.
Submit the payment: Once you have reviewed and confirmed the payment details, submit the ACH debit payment. The transaction will be processed, and the funds will be electronically debited from your bank account and transferred to the recipient’s account.
Record and retain documentation: Keep a record of the ACH debit payment, such as transaction confirmations, receipts or any other documentation provided by your bank or payment service provider.

How to make an ACH credit payment

Follow these steps to make an ACH payment via credit:

Collect recipient information: Obtain the necessary information from the recipient to initiate the ACH credit payment. This data includes the recipient’s name, bank account number and bank routing number.
Verify your bank’s ACH credit service: Ensure that your bank supports ACH credit transactions. Not all banks offer this service to their customers, so it’s important to confirm beforehand.
Set up online banking or ACH service: If you haven’t already, enroll in online banking or an ACH service provided by your bank. This measure will allow you to initiate ACH credit payments conveniently.
Access the payment section: Log in to your online banking account or ACH service provider’s platform and navigate to the payment section or ACH transfer section.
Provide payment details: Enter the recipient’s bank account number, routing number, payment amount and any additional information required by your bank or service provider. Double-check the accuracy of the information to ensure the funds are directed to the correct account.
Review and confirm: Review the payment details before finalizing the transaction. Verify the payment amount, recipient information and any additional details you enter.
Initiate the payment: Once you have confirmed the payment details, submit the ACH credit payment request. Your bank or service provider will process the transaction and transfer the funds from your account to the recipient’s account.
Retain documentation: Keep documentation of the ACH credit payment for your records.
Follow up: If necessary, follow up with the recipient to confirm that they have received the ACH credit payment successfully.

ACH payments vs. direct deposits

ACH payments and direct deposits are both electronic methods of transferring funds between bank accounts, but they differ in their purpose and the direction of the transaction.

Direct deposits are a specific type of ACH payment that refers to funds being electronically deposited into a recipient’s bank account, typically for the purpose of receiving income or funds owed. Direct deposits are commonly used for payroll deposits, government benefit payments, tax refunds, pension payments, and other regular or recurring income streams.

Direct deposits are always initiated as ACH credits, with funds pushed into the recipient’s account. The payer, such as an employer or government agency, initiates direct deposits to the recipient’s designated bank account. Recipients often need to provide their bank account and routing numbers to the payer to set up direct deposit.

Key differences between ACH payments and direct deposits include:

Purpose: ACH payments encompass a broader range of electronic fund transfers, including both payments and receipts, while direct deposits specifically refer to receiving funds into an account.
Direction: ACH payments can be either ACH debit, which involves pulling funds from the payer’s account, or ACH credit, which involves pushing funds to the recipient’s account, whereas direct deposits are always ACH credit payments.
Usage: ACH payments are more versatile and can be used for various purposes, while direct deposits are primarily used for recurring income or benefit payments.

Accepting ACH payments from customers

Accepting ACH payments from customers can provide convenience and flexibility for your business. Here’s an overview of the steps involved in setting up and accepting ACH payments:

Verify ACH payment support: Ensure that your business has the capability to accept ACH payments. Contact your bank or payment service provider to confirm if they offer ACH payment processing services. If not, explore alternative solutions such as third-party payment processors or specialized ACH service providers.
Obtain authorization: Before initiating ACH payments from customers, you need to obtain proper authorization. This can be done by having customers sign an authorization agreement or including authorization clauses in your terms and conditions.
Collect customer information: Gather the necessary information from your customers to process ACH payments. This typically includes their bank account number, routing number and authorization to debit their account. Consider using secure methods to collect and store this sensitive information.
Set up payment processing system: Set up a payment processing system that supports ACH payments. You can complete this step using your bank’s online banking platform, a payment gateway or a specialized ACH payment processing service.
Integrate the ACH payment option: If you have an online store or payment portal, integrate the ACH payment option to provide customers with the choice to pay via ACH. Work with your web developer or payment service provider to enable ACH as a payment method.
Educate customers: Clearly communicate to your customers that you accept ACH payments. Update your website, invoices and other communication channels to inform customers of this payment option. Provide instructions on how they can provide their bank account information and authorize ACH payments.
Process ACH payments: Once customers provide their authorization and necessary payment information, initiate the ACH payments through your chosen payment processing system. Follow the instructions provided by your bank or service provider for initiating ACH debit transactions securely.
Monitor and reconcile payments: Regularly monitor your ACH payment transactions and reconcile them with your records. Keep track of successful payments, failed transactions and any necessary follow-up actions, such as resolving insufficient funds or other payment issues.
Ensure security and compliance: Protect customer data and maintain compliance with applicable regulations. Implement security measures such as encryption and access controls to safeguard customer information.

By offering ACH payment options to your customers, you can streamline payment processes, reduce reliance on paper checks and make it easier for people to do business with you.

Choose CSG Forte to start making ACH payments

ACH payments have revolutionized the way businesses and individuals handle their financial transactions. Offering convenience, cost savings and enhanced security, ACH payments have become a preferred method for many individuals and organizations. As technology continues to advance, ACH payments are likely to play an increasingly significant role in our digital economy.

Contact the team at CSG Forte to learn more about how to make an ACH transfer.

Beat The Numbers Game: Guard Against Card Testing Fraud

Posted on October 27, 2025

Card-testing fraud has gone from nuisance to nonstop swarm—supercharged by cheap bots and off-the-shelf artificial intelligence (AI). In 2025, fraud teams report that card testing (aka enumeration) remains one of the most common attacks online, hitting roughly 45% of merchants worldwide even as some other fraud types cooled this year. At the same time, nearly half of financial institutions say monthly bot attacks are rising, underscoring how automation is amplifying low-value, high-volume probes that quickly cascade into chargebacks and network monitoring trouble.

For merchants, that “pennies at scale” behavior isn’t harmless: enumeration drives ecosystem losses in the billions and can push businesses toward acquirer/network programs when thresholds are crossed—especially under 2025’s tighter Visa monitoring rules. If your checkout, APIs, or account pages aren’t rate-limited and bot-mitigated—and if you’re not leaning on tools like velocity controls, AVS/CVV with intelligent retries, 3-D Secure 2.x, and network tokens—you’re inviting attackers to find valid PANs and move up the value chain.

Payment solutions can play a major role in protecting businesses from card testing-related losses. But does yours have the right capabilities? Read on as we explain card testing and some fundamental ways to reduce its impact on your customers and your bottom line.

What is card testing?

Card testing is a payment fraud technique where cybercriminals use automation or bots to guess valid credit card numbers. It’s literally a numbers game. Fraudsters submit a barrage of small transactions of just a few cents each, testing to see if a card number is valid. Once they’ve identified a set of card information that works, they then use it either to make larger unauthorized purchases or sell the card info on the dark web.

For merchants, falling victim to card testing can disrupt operations and generate costly chargebacks. But it means more than revenue loss: there’s also reputational damage to consider. According to a PYMNTS survey, 21% of consumers said that losing money due to fraud would be the most important factor that would erode their trust in a merchant.

5 layers of protection against card testing attacks

In the battle against card testing fraud, your strongest line of defense is a modern payment solution. It can safeguard your transactions and customer data in multiple ways. Here’s how:

1. Spot it early

As we all know, the earlier fraud is spotted, the better. Modern fraud detection platforms are doing this better than ever by engaging machine learning and sophisticated, dynamic rules that identify suspicious transactions and evolving patterns as they happen. These systems flag and report suspicious activity before bad actors “crack the code” and make a successful unauthorized charge, or before they can go on to do significant damage with the stolen card information.

Tell-tale signs: sudden bursts of tiny or $0/$1 authorizations, many declines in a short window, the same card BIN showing up repeatedly, or a spike in traffic with few real checkouts
Why it’s happening: fraudsters now use cheap bots—and increasingly AI—to run thousands of quick tests to find a “live” card number before moving on to bigger purchases elsewhere

2. Boost your tokenization technology

Modern payment solutions typically replace sensitive card data with unique tokens—randomly generated values that are unrelated to the original card data. This adds an extra layer of security. Even if bad actors intercept the merchant’s card data, the tokens render that data useless for making unauthorized transactions.

3. Make testing harder

Add a light “are you human?” check on payment and account pages when activity spikes.
Slow rapid-fire attempts with simple limits (e.g., only a few tries in a short period).
Turn on AVS and CVV checks for first-time payments so obviously bad attempts fail fast.

4. Get 3DS authentication

Modern payments solutions often integrate 3D-secure protocols, or “3DS,” which stands for 3 Domain Secure. This is an authentication method for online transactions that relies on three domains:

Issuer domain — The bank or financial institution that issued the card
Acquirer domain — The bank or financial institution processing the payment on the merchant’s behalf
Interoperability domain (card scheme) — The payment card network (e.g., Visa, MasterCard) that connects the issuer and acquirer domains

If you’re using 3DS, a cardholder making an online purchase undergoes an additional authentication step. This typically involves redirecting them to a page hosted by their card issuer or having them provide a one-time authentication code that is sent to their phone. And it’s this extra step that adds another strong barrier against card testing attempts.

5. Update and monitor regularly

Payment fraud techniques evolve, and so should your defenses. Your SaaS provider should provide regular updates and enable round-the-clock monitoring, making sure your payment system is always equipped with the latest security features.

Watch for patterns, not just single declines: Unusual spikes in small authorizations, odd geographies, or “many cards/one device” should trigger a closer look.
Have a short playbook: Pause the affected page or endpoint, tighten limits for an hour, review the attempts, and notify your payments partner if thresholds were hit.
Clean up quickly: Void/refund test charges, update blocklists and, if needed, rotate any exposed credentials.

Act today

Safeguarding your organization against card testing is a must. Do you know if your payment ecosystem has all these protections in place for you and your customers? Talk to us at CSG Forte, and we can help you ensure your payments security is up to task—even as fraudsters put it to the test.

Unlock Seamless B2B Payments: How ACH Powers Modern Growth

Posted on September 23, 2025

Every thriving business relationship relies on trust, efficiency and the seamless movement of money. Yet for too long, business-to-business (B2B) payments have been weighed down by outdated processes, endless paperwork and frustrating delays. But with the continued adoption and expansion of Automated Clearing House (ACH) payments, companies are finding new momentum—unlocking smoother transactions, reducing costs and powering growth without the usual financial friction.

Explore the value of this payment type for transactions between businesses.

What Are Business-to-Business ACH Payments?

Business to business ACH payments are electronic fund transfers between two companies. ACH payments provide a modern and secure method for processing fund transfers electronically. These transfers occur in the ACH Network and eliminate the need for paper trails that come with checks, money orders and other conventional payment methods.

ACH is a widely used electronic payment system in the United States and internationally. With this network so widely recognized, it can be an ideal solution for business to business payments between companies that are located in different states or countries.

Business to business transactions encompass a wide range of corporate processes, from paying advertisers and shipping companies to covering rent for office spaces. While many individuals have stopped using checks for their day-to-day payments, many businesses are still relying on these slips of paper to make large payments to other businesses. With corporate ACH payments, businesses can streamline a significant aspect of operations.

How Does Business to Business ACH Work?

All ACH payments start with two bank accounts—the Originating Depository Financial Institute (ODFI) and the Receiving Depository Financial Institute (RDFI). Essentially, there’s a bank account requesting a payment, the RDFI, and an account sending money to respond to the request, the ODFI.

In B2B ACH payments, this arrangement stays the same. However, rather than a corporate bank account and a consumer bank account, the transaction happens between two corporate accounts. The Clearing House or the Federal Reserve oversees the transaction by storing and processing the funds. Since these transactions are not direct from bank to bank, they can take one to two days to process.

The entire ACH process can be divided into four steps:

Authorization: Before funds can move from one account to another, the ODFI needs authorization from the owner of the account to transfer funds through ACH. During authorization, the business will have to provide the account and routing numbers for the corporate account and other details to verify the use of their funds. As a business requesting this authorization, you may send an email with a link to the accounting department, so they can complete the authorization process.
Initiation: The business then sends its information to the ACH provider or ODFI to initiate the transaction.
Request: After initiating the transaction, the ODFI can send a payment request to the RDFI to receive the necessary funds for a product or service.
Processing: As long as all information is correct and the RDFI account has enough funds to complete the request, processing can begin. The funds move from the RDFI account to the ODFI, and the business receiving funds will officially be paid for their product or service.

Benefits of B2B ACH Payments

Using ACH payments for your B2B transactions has many advantages, including:

Simplicity: ACH payments are easy to set up with the right ACH provider. Both companies involved only need to provide account information for their corporate bank accounts and work with a provider who supports the process. Most banks allow the ACH process to occur with authorization, so there’s no need to have a special account or change the way you manage financials for your business.
Speed: While there is a processing window for ACH payments, it is typically only a few days maximum. Even with this processing time, businesses will receive confirmation that funds are entering their account before they officially arrive. This aspect makes business to business ACH debit much easier than checks. Accounting teams don’t need to reconcile the bank account with several outstanding checks that have not yet been cashed.
Security: With many businesses still relying on checks for B2B payments, check fraud is a possibility. Businesses are particularly at risk because they send multiple checks with large amounts. ACH payments are completely electronic and verified through your ACH platform, so you know you’re genuinely receiving money from your client businesses, and information like account and routing numbers is kept private.
No processing fees: ACH payments are free of all processing fees, which is a major benefit to businesses that transfer money frequently between suppliers, clients and beyond. With so many transactions, small fees can add up and lead to large costs at the end of a month.
Low transaction fees: Transaction fees for ACH payments are often free or low in cost, depending on the financial institutions involved. Compared to wire transfers or credit card processing, these fees are incredibly cost-effective.
Electronic records: ACH payments have a clear electronic record you can access at any time, so it’s easy to manage invoicing processes, and you can cut down on paper records.

Implement ACH Processing With CSG Forte

CSG Forte’s Dex payments platform is the key to implementing ACH processing for your B2B transactions. Manage online, in-person and over the phone payments with a unified, cloud-based solution. With transparent reporting, you can stay connected to every transaction and manage your funds more efficiently.

Get in touch with us today to learn more or make an account with us to get started.

How Can ACH Processing Benefit Your Business?

Posted on September 19, 2025

Imagine a world where cash flow is seamless, paper checks are relics of the past and getting paid—or paying others—happens almost as effortlessly as sending a text. Welcome to the age of Automated Clearing House (ACH) payments, where modern businesses are reimagining the way money moves and unlocking new levels of efficiency, flexibility and security.

ACH payment processing continues gaining popularity as businesses and customers recognize this system’s many benefits. ACH processing is an electronic payment method that allows companies and individuals to send and receive money.

These digital transactions offer significantly lower costs and added convenience for recurring transactions. As a result of ACH’s benefits, many businesses are leaving paper checks and other payment methods behind in favor of this electronic option.

ACH Payments: What Are They and How Do They Work?

ACH payments are a digital method for sending and receiving funds. These transactions pass through the Automated Clearing House, an electronic funds transfer (EFT) system established by the Bureau of the Fiscal Service, letting businesses and individuals send credit and debit card payments.

Businesses often use these payments to cover employee payroll or receive money for customer payments for goods and services. In many cases, electronic payments must obtain an authorization request from a credit card network or issuing bank. ACH payments instead go through the Federal Reserve or a clearinghouse to secure payments.

Once the request passes through one of these organizations, the receiving depository financial institution (RDFI) posts the payment to the requestor’s account. Businesses save money and time making money transfers when using ACH instead of credit card authorization. They can accept or send payments of as much as $1 million each day, and the system recognizes revenue faster, so you can receive or send funds in as little as a few hours.

Are ACH Payments Safe?

As a government-established electronic payment method, ACH transactions must follow strict federal regulations for safety in money transfers. Nacha, a non-profit organization, also regulates and runs this money transfer network. CSG Forte is a Nacha Preferred Partner. These controls make fraud rare, though not completely unlikely.

Here are a few additional ways your business can reduce the risk of fraud:

Choose a trusted payment provider: Ensure your provider complies with Nacha rules. You can look for Nacha-preferred partners for the most security.
Use microdeposits: The best payment providers offer microdeposits to verify recipient identity. These are two small deposits made to an account before formal transactions begin.
Seek information protection: Your provider should utilize tokenization and encryption to disguise sensitive data. These controls ensure only the intended recipient can interpret the data you send.

Benefits of ACH Payments for Businesses

Many businesses adopt ACH payments for ease, security and speed. This electronic money transfer method continues to grow in popularity, with companies carrying out 5.94 billion transactions using this method in 2022. Businesses compare these transactions to previous payment methods like paper checks and see distinct ACH payment benefits, leading them to adopt the system.

Lower Costs: Compared to electronic and paper payment methods, ACH transactions are one of the most cost-effective money transfer options. Credit card companies require network fees for processing transactions. These fees range from 1.5% to 3.5%. Checks also cost $2.01 for internal expenses like financial institution fees and $4 for external costs like personnel. Paper checks are often mailed, which is an additional expense when you factor in materials and postage. In comparison, ACH has a median internal spending of $0.15 and an external cost of $0.25.
Speed: ACH payments have faster processing times. Like all electronic processing methods, ACH is faster than payments like checks, which must be mailed and manually entered. Checks might also get lost, extending the time before the recipient receives money in their account.
ACH transactions also process faster than many electronic transfer methods, sometimes within a few hours on the same business day. You can also schedule transactions for one or two business days away. With same-day transfers, you can ensure that payments settle the day your business sends them out.
Minimal Human Error: Human error can cause payment delays and impact organizations’ cash flow. With computer-automated payment through ACH processing, you reduce mistakes like incorrect payment amounts or errors in recipients’ account numbers. You can set recurring payments up once, ensure the information is correct and let the transaction repeat each billing cycle without needing adjustment.
Customer Convenience: ACH payments also have many benefits for customers, including the convenience of a one-time setup. For recurring expenses like rent or a subscription service, your business can request authorization once, then continue to take payments as needed. Customers like this method because it is convenient and they will always pay on time, avoiding late fees or lapses in service. Business-to-business transactions also work well with ACH because many companies are switching to digital money management tools.
Expense Tracking: With ACH, your business can record all income electronically, and the information is more easily accessible to bookkeepers. With ACH payments you can easily view transactions online and connect them to money received or disbursed.

Collect ACH Payments With CSG Forte

With CSG Forte’s complete payments solution with ACH processing, we make it easy for your business to send and receive digital payments. Learn how you can start accepting ACH payments and Get Started with CSG Forte today.

What Are ACH Debits? ACH Debit Transactions Explained

Posted on September 12, 2025

Like many activities, financial transactions have gone digital. These electronic transactions occur primarily through an affiliated financial institution network called the Automated Clearing House (ACH) Network. This system helps move money between parties’ financial institutions simply, quickly and cost-effectively.

Nacha is that governing body that oversees the network and its transaction processing, which totals billions of dollars processed every year. Nacha establishes the rules and procedures for submitting and processing ACH debit and credit requests — the two main transaction categories. In 2020 CSG Forte was named a Preferred Partner for Government Agency ACH Payment Gateways by Nacha. This is a designation given based on leadership and innovation in advancing the ACH network.

What Is an ACH Debit?

An ACH electronic debit is a transaction withdrawing money from an account electronically. ACH debits can pull funds from checking and savings accounts, though restrictions on debits may apply to some business accounts.

Identification Requirements

Whether the transaction classifies as an ACH debit depends on which party originates the request.

For each debit, there’s a corresponding ACH credit — funds received by the other party to the transaction. When you authorize a company or individual to withdraw funds from your account electronically, they initiate the request with the network. These qualify as ACH debits since they’re pulling money from — debiting — your account. The funds’ ultimate deposit into their account represents the transaction’s ACH credit portion.

ACH Debit Payment Timing

While ACH debit payments and credits are swift, they’re not instantaneous. NACHA aggregates transactions and processes them in batches. The ACH Network settles payments four times each day to facilitate efficient money transfers.

Advantages of ACH Debits

ACH debits for business have numerous advantages, including:

Cost control: ACH debit processing is generally more affordable than handling physical checks or even credit or debit card transactions.
Better risk mitigation: Since fewer people are involved in processing, there’s less fraud and error risk.
Faster payment collection: ACH debits provide cash flow sooner than traditional check processing.
Improved recordkeeping: Completing payments with ACH debits creates electronic traces for easier tracking, reporting and reconciliation.
Environmental friendliness: ACH debits reduce the need for paper checks and mail trucks that consume resources.
Reversibility: ACH debits can be reversed when errors occur, unlike wire transfers, which are generally challenging to recapture.

ACH Debit Challenges

ACH debits can also pose some unique challenges, such as:

Financial institution restrictions: Some account holders restrict ACH debits to transactional, daily, weekly or monthly limits.
Limited funds availability insight: The ACH network doesn’t support immediate feedback on errors or guarantee funds availability.
Real-time execution: The ACH network doesn’t provide instant credits, though it can significantly reduce processing time versus physical checks.

How Do ACH Debits Work?

ACH debits follow a prescribed three-step process:

1. The payee initiates the request: The recipient submits a message to their account holder, called the originating depository financial institution (ODFI), requesting it to debit the payer’s account using:

The bank routing and account numbers of the account to debit.
The transaction amount.
The Standard Entry Class (SEC) code.
A proposed transaction settlement date.

The ODFI then enters the request on the ACH network.

2. The payer’s account holder receives the request: At regular intervals each business day, the ACH network passes these withdrawal requests to the payer’s account holder, the Receiving Depository Financial Institution (RDFI). The network bundles demand by institution, so the RFDI will get multiple debit requests with each “drop.” The RDFI investigates the requests and transmits any error messages or rejections to the ACH network.

3. The transaction settles: As long as there are no errors or rejections before the proposed settlement time, the ODFI and RDFI will transfer balances between each other through their respective Federal Reserve accounts. Once the ODFI receives the funds, it credits the payee’s account to finalize the transaction.

Main Types of ACH Electronic Debits

There are two primary categories of ACH debit transactions — recurring payments and one-time authorizations — before the activities receive additional standardized coding.

Recurring Payments: Establishing an automatic payment with a company gives it recurring authorization to initiate an ACH debit from your account information. For example, many consumers sign up for automatic payments on their wireless bills or streaming services. As the bill comes due each month, the provider uses the agreement to request the funds to satisfy the amount owed. This convenience ensures people don’t forget to pay and prevents late fees or service disruptions.

On-Demand ACH Transactions: One-time authorizations allow a receiving party to request the monies for a single transaction. They are also called on-demand ACH debits because they don’t represent an ongoing arrangement. An example is a consumer agreeing to an ACH electronic debit from their account for a tax payment or individual purchase. Under this ACH debit type, consumers generally retain more control over when a business can electronically withdraw funds.

Standard Entry Class Identification: The ACH network recognizes numerous debit types beyond recurring and on-demand. Initiators can use a three-character SEC code to identify the precise type.

Accounts receivable entry (ARC): This code represents converting checks from payment drop boxes or mail into one-time authorization to debit the payer’s account electronically.
Back-office conversion (BOC): BOC transactions use a check presented in person to initiate an ACH debit after acceptance.
Machine transfer entry (MTE): This code applies to automated teller machine (ATM) withdrawals to debit a bank account for the funds withdrawn from the machine.
Point-of-purchase transaction (POP): Unlike BOC check conversions, POP transactions use physical checks immediately upon receipt and return the paper check to the presenter once the system accepts the debit.
Point-of-sale entries (POS): POS transactions may be the most common, as they use your debit card to withdraw the corresponding funds from your account.
Prearranged payment and deposit (PPD): Recipients use this code to originate recurring and automatic payments.
Shared network entry (SHR): Much like the MTE, the SHR code settles ATM withdrawals for machines within the same network.
Telephone-originated request (TEL): This SEC identifier applies to payment authorizations received in phone interactions.
Web-initiated transaction (WEB): As its name suggests, WEB is reserved for ACH debits agreed upon through internet activity.

ACH Debit vs. ACH Credit

ACH credits differ slightly from ACH bank debits, though they generally represent two sides of the same transaction.

A transaction qualifies as an ACH credit when an account holder electronically sends money to another’s account, typically at a different financial institution. Since they’re depositing funds rather than withdrawing them, this action is also called a “push.”

The ODFI will enter the request with ACH, which passes the crediting information onto the RDFI. Settlements occur the same way as with ACH debit — as long as the information reconciles correctly, the RDFI accepts the funds and credits the recipient’s account.

Direct deposits, electronic refunds and peer-to-peer payments are all ACH credit transaction examples.

EChecks vs. ACH Debit

eChecks — short for electronic checks — can represent an ACH debit, but the term isn’t definitive. While eCheck can describe any portion of the digital money exchange, ACH debit applies specifically to cases where the recipient initiates the payment request.

Another key difference is whether the money transfers via ACH. eChecks can be used to support a wire transfer that occurs outside the ACH network. Almost all physical checks go through some electronic processing, but not all result in ACH debit and credit transactions.

Choose CSG Forte as Your ACH Debit Solution

As an experienced NACHA Preferred Partner for payment solutions, CSG Forte leverages scalable, easy-to-use technology to simplify and streamline online payment collection.

eCheck vs. ACH What Is the Difference?

Posted on August 22, 2025

Many terms exist to describe different types of automatic payments, and it can be hard to understand what they all mean. At a high level, the broadest category is electronic funds transfer (EFT). Automated Clearing House (ACH) payments and electronic checks, or eChecks, are two examples that fit under the EFT designation. The terms eChecks and ACH payments are often used interchangeably; however, they have distinct differences. ACH transactions include various forms such as payroll and interest, while eChecks refer only to electronic transactions completed between checking accounts.

What Is an Electronic Check, or eCheck?

An eCheck is a type of EFT that involves transferring money between two checking accounts. This payment method goes by several other names, including electronic check, direct debit and internet check. Many businesses incorporate eChecks into their systems to accept large amounts of money. Companies that operate solely online also benefit from eChecks because they offer customers an additional payment option for transferring funds.

eChecks function much like paper checks, but have an advantage because they do not become outdated. They also process faster because they skip the manual deposit process of sending a check and waiting to bring it to a bank. Typically, eChecks process in 24 to 48 hours. Customers also get more security through eChecks than they would with traditional payment methods, making them an appealing option for those sending and receiving funds.

It’s important to note that a business must work with a processing company to use electronic check ACH transfers. eChecks require particular software for safe and effective use.

How Do eChecks Work?

Unlike when a business uses a regular paper check, making an eCheck payment doesn’t require writing or printing information onto a piece of paper. Instead, the payer enters all information electronically, transferring funds from one account to the other without a traditional paper trail. Typically, the payee will send an online form. Customers then enter their checking account information and the amount paid. Payees can also accept eChecks over the phone with recorded phone calls. This process can save time and reduce paper use, reducing effects on the environment.

Another important note is that merchants must pay a small fee to process eChecks. The price is minimal and often worth the cost due to the added convenience and savings gained by not having to print and mail paper checks.

Other potential benefits for businesses when accepting eChecks include:

Convenience: Depositing checks at the bank can be time-consuming for customers and businesses. eChecks make it easier to facilitate transactions without requiring extensive work for administrative staff. Additionally, eChecks often clear much faster than traditional checks, allowing businesses to access funds quickly.
Cost-effectiveness: eChecks generally have lower transaction fees compared to credit card payments, making them ideal for large transactions. Due to several features implemented by the ACH network, customers who use eChecks may also be less likely to initiate chargebacks compared to transactions with credit card companies. Fewer chargebacks can help businesses avoid potential lost revenue.
Improved cash management: Fewer administrative obstacles and faster processing times contribute to better insights into funds, particularly for businesses with tight operating margins. Quicker access to funds can help facilitate better decision-making about expenses.
Increased customer satisfaction: Businesses that offer multiple forms of payment can access a broader range of customer preferences. Accepting eChecks can make businesses more appealing to customers looking for flexibility and ease of payment.

How Are eChecks Processed?

Businesses desiring to implement eCheck processing may want a more in-depth look at how the process works. Here’s a step-by-step explanation:

Reach out for authorization: All ACH payments, including eChecks, require approval from both parties by sending a signed order form, speaking on the phone or filling out an electronic form.
Enter payment information online: To begin processing information, you must enter customer information, including the bank’s routing number, account number, name, address and federal tax identification number.
Confirm and submit: After filling out all necessary fields, your business should ensure all information is correct and confirm submission through the software or payment gateway.
Initiate transfer: Submitting the payment details to the ACH network triggers the transfer of funds and coordinates with the bank for verification and movement of money.
Bank verification: Once the payer’s bank receives the account information and confirms the availability of funds, it will approve the transaction for processing.
Process payment: Once you submit a payment and the transaction is approved, the payer’s account will automatically withdraw the amount within three to five days.
Receive confirmation: When the transaction is complete, both parties generally receive confirmation receipts that show the check amount and other details.
Recordkeeping: The electronic process means the parties receive electronic records, which are often easier to manage and retrieve for accounting or auditing purposes.
Settlement: The process is officially complete once the ACH settles the transaction with both banks.

What Is ACH Processing?

eChecks are a type of ACH payment, but not the only kind that exists. Broadly, ACH refers to the Automated Clearing House, a federal EFT system run by the National Automated Clearing House Association, or Nacha. The network moves money directly between banks for ease and security in transferring money. Consumers, businesses and governments use this funds transfer method.

ACH processing has two main categories—credits and debits—so you can send money to customers or request that customers pay you. Here are a few primary uses for ACH transactions:

Refunds (including taxes)
Interest payments
Government benefits
Payroll
Employee expense reimbursement
Mortgages
Financing
Direct deposits

ACH payments offer a range of advantages over other payment methods, including:

Low transaction costs: ACH payments charge a per-transaction fee, no matter the payment amount, which is significantly more affordable compared to some traditional payment methods like credit cards, wire transfers, checks or cash.
Secure payments: ACH processing provides secure payments by facilitating direct transactions between the payer and payee without any interference from a third party. This process can help reduce the chances of fraud or payment errors like misused credit card information, cash theft or bounced checks.
Repeatable and reversible transactions: Some electronic payment methods require customer bank account information at each transaction. ACH offers recurring payments and automated transactions for customers and businesses, helping to reduce missed payments, save time and keep private information secure. ACH payments are also reversible, which can reduce the risk of fraud.

How Does ACH Processing Work?

The ACH network connects thousands of banks and other financial institutions across the United States. When a business or individual pays or requests payment, the request gets batched with other transactions. Here’s an example of the process for ACH direct payment:

Receive authorization: Before your business can bill a customer, you must receive permission through an authorization form that allows you to pull money from the customer’s bank account.
Information collection: Your business must provide details about the transaction to your bank, including routing numbers, bank account information and transaction type. The depository institution in the ACH network is known as the originating depository financial institution (ODFI).
Collecting and batching: The ODFI collects all transaction files and forwards them to be processed. During processing, the Federal Reserve or a clearinghouse receives the batch of transactions.
Receiving and distribution: The institution sorts them to determine which bank the payment must come from, and which bank receives it, which is known as the receiving depository financial institution, or RDFI\. The recipient’s bank account gets the transaction and reconciles both accounts, which completes the transfer process.

EChecks vs. ACH: Breaking Down the Differences

eChecks are a specialized form of ACH transaction, so these two electronic payment types have many similarities. Both are processed electronically, use the same network for processing and require authorization before making or receiving a transfer. They also have the same transaction limit.

Though eChecks and ACH have many similarities, comparing electronic checks vs. ACH brings out a few differences, including:

Payment time: Both electronic transfer types take about four business days to process. However, those receiving eChecks may at times wait up to five days to receive the money.
Technology used: eChecks were not available when the ACH was first created. This payment type was added to the system after new technology was developed and requires using an eCheck service.
Payment uses: eChecks are more specialized than ACH transactions, usually for one-time expenses. This means the banking information is not stored once the transaction is complete. ACH covers recurring costs that occur on a schedule and stores the payment information for future deductions.

Cost per transaction: ACH and eCheck transactions typically charge fees based on a percentage of the total transaction, but the fees charged for eChecks are often much lower. ACH payments may present chargeback, reversal or return fees in some cases. Both payment types have lower costs to process than credit card transactions.

Choosing Between ACH and eChecks

ACH payments and eChecks offer affordability, speed and security, making them appealing money movement options for merchants and customers. You can refer to the difference between eCheck and ACH payment types to decide which is best for your business’ needs.

For example, a recurring expense like payroll is better handled through ACH than an eCheck. Payments from customers to your business might work better with an eCheck. Companies that see benefits in both types of transactions can often get them together since they use the same system.

Why Choose CSG Forte for eCheck and ACH Processing?

eChecks are a secure, fast and convenient way to receive payment from customers, but you need a processor that accepts this payment type. CSG Forte offers a payments platform that accepts eChecks, ACH transactions and credit and debit cards on a single platform. Our system integrates with existing ones and can be customized to meet changing business needs.

Contact one of our payment experts to learn more about how our complete payments solution can benefit you. You can also explore ways to get started with our solutions.

What is an ACH Credit and How Do They Work?

Posted on July 11, 2025

Do you compensate your employees through direct deposit? Have you paid your bills online? If so, you have sent ACH credit. The Automated Clearing House (ACH) is a critical network in the United States financial industry that manages millions of transactions like these every day.

ACH credit makes electronic money transfers possible, so many systems and apps use this infrastructure for digital payments. You can benefit from fast, simple and secure payments when your business uses ACH payment solutions.

Read on to understand the meaning of an ACH credit and how it can boost your business.

What Does ACH Electronic Credit Mean?

An ACH credit is an electronic payment that sends money from one account to another. The payer (the person sending the payment) makes the request to push funds from the originating bank account (the payer’s account) to the recipient (the person receiving the payment) by putting the funds in the deposit account (the recipient’s account).

This method requires only a few basic transaction details, including the payer’s and recipient’s:

Name
Bank account number
Bank routing number

In just a few hours or days, the transaction is completed, and the recipient has the funds in their account.

ACH credits occur through ACH, an electronic money network connecting every major financial institution in the country, including credit unions, banks and the Federal Reserve. With this network, people and businesses can facilitate payments between accounts regardless of the banking institution. The National Automated Clearing House Association (Nacha) manages the ACH network and ensures payment is safely and quickly transferred. While this network mainly transfers money within the U.S., it can be used for international transfers.

How Does ACH Credit Work?

ACH credits are essentially a digital form of paper checks. With a paper check, the payer would fill out a check for the recipient to take to their bank. With credit ACH, the details are recorded and the funds are transferred electronically.

Here is how ACH electronic credits work:

The payer initiates the payment: The payer provides the originating bank—or the Originating Depository Financial Institution (ODFI)—with the recipient’s account number and routing number, the amount of money to transfer, and a target settlement date (the date to transfer the money).
The ODFI sends the payment details to ACH: The ODFI or their approved processing partner starts the transfer by sending the request to the ACH network. These institutions may batch several transactions to send to ACH in bulk.
ACH sends the details to the recipient’s bank: The ACH network receives incoming transfer details in bulk and breaks them down into individual transactions. They bundle the transactions into batches and send the batch to the depositing bank—or the Receiving Depository Financial Institution (RDFI). ACH completes this process five times per business day.
The RDFI processes the transaction: The RDFI receives the ACH bundles in their system and executes the transaction based on the processing window. Any transactions with incorrect information will trigger an error code, and the RDFI sends error codes back to ACH.
The ODFI and RDFI settle the transaction: If the transaction has the correct details, the ODFI and RDFI settle the payment using their Federal Reserve balances.
The recipient receives the payment: The RDFI releases the ODFI funds to the deposit bank account.

This process typically takes two business days, but it can be completed in one day if the ODFI pays a fee for same-day processing.

What Are Examples of ACH Electronic Credit Payments?

Many individuals and businesses use ACH credit every day without realizing it. Any payment involving an account number and routing number to transfer money counts as an ACH transfer.

Why Would You Get an ACH Credit?

The most common examples of ACH credits include:

Online purchases: For merchants that do not accept credit card payments online, consumers can use an ACH transfer to pay the store for their order.
Refunded purchases: When merchants need to refund a consumer for a returned product, they can push money from their account to the consumer’s account. This transaction is an ACH credit.
Government benefits: The U.S. government uses ACH credit to send money from its accounts to qualified recipients for stimulus payments and similar transactions.
Direct deposit: When employers send payroll to employees through direct deposits, these transfers are a type of ACH credit. Funds in the employer’s account are pushed to their employees’ bank accounts.
Bill payments: Many companies allow customers to pay their bill online. Customers can provide their account and routing numbers to transfer funds from their account to the business to settle the bill.
Peer-to-peer payments: Payment apps like Venmo and PayPal allow people to send money to another person. This transaction is an ACH credit payment. While an ACH credit transaction is free, fees may be incurred depending on the bank used. If the ODFI or RDFI uses a processing partner, the partner may charge additional fees. The bank itself may charge a fee per transaction. The fee for an ACH credit transaction can range from tens of cents to a couple dollars.

Factors that impact ACH credit fees include:

The number of transactions processed per month
The monetary amount of transactions
The likelihood the transaction will be returned
If the transaction requires same-day processing
Which account validation method will be used

Since these fees operate on a scale, businesses will see reduced costs per transaction the more transactions they have.

What Benefits Do ACH Credit Payments Offer Your Business?

Compared to traditional payment methods, ACH processing is quicker, easier and more secure. ACH transactions offer many advantages, including:

Simple setup: ACH credit requires the payer’s and recipient’s bank account number and routing number. By requiring only a few details, your business can easily set up one-time or recurring payments. Because these numbers change infrequently, if ever, you can count on your payments to go through.
Minimal to no transaction fees: Compared to wire transfers and credit cards, ACH credit fees are much lower, if there is a fee at all. This cost-effective fee pricing leads to monetary savings for your company.
Fast payments: ACH credit is one of the most efficient payment methods available. You can pay your employees and bills right away without manual processing. Funds move quickly between banks and are available in the deposit account as soon as the transaction is finalized.
Enhanced security: Credit ACH transactions have many security measures to ensure the funds are safe between the originating and deposit accounts. For example, bank account verification requires the payer and recipient to prove their bank account numbers, and fraud detection verifies the parties’ identities.
Accessible payment records: You can review electronic records of your transactions in your ACH processing platform at any time.

Choose CSG Forte for Your ACH Solutions

Your company can process ACH payments from any device, bank or source with validate services from CSG Forte. We offer two solutions—Validate and Validate+—to process and report your payments while reducing manual errors and identifying bad checks before processing. Your business can also validate online transactions for fraud, keeping you compliant with Nacha.

Going Digital: Understanding Merchant Services Providers

Posted on May 8, 2025

Cash has long been king, but its reign is quickly winding down.

Customers today increasingly prefer a modernized, digital payment experience for several reasons: ease of transfer, remote purchase capabilities and security, to name a few.

If your business doesn’t already accept credit cards, debit cards and other electronic payments, you’ll want to rethink that strategy before falling further behind—digital transactions accounted for 30% of all point-of-sale (POS) transactions and 50% of all online sales in 2023, and those shares are only expected to increase.

To get your company online, able to accept digital payments, you’ll need to partner with a merchant services provider (MSP). And, especially if you’re new to the online payments world, with all its regulations, compliance requirements and data protection laws, you’ll need to make sure and choose the right payments partner.

What Is a Merchant Services Provider?

A merchant services provider is a go-between company that acts as a mediator between your business and credit card companies and/or banks. If your company wants to accept multiple forms of payment beyond cash, it needs to work with a partner that offers secure merchant services.

The goal of most MSPs is to facilitate and secure the payment process for companies and their customers. Along with acting as the intermediary between banks and your company, an MSP may also allow you to connect your online and physical stores’ payment systems, ensure you stay compliant with security regulations and offer customer support.

Depending on your needs, your MSP may provide services such as payment processing, payment gateways, POS devices and merchant accounts.

Merchant Account Provider vs. Payment Gateway

Payment gateways and merchant account providers fall under the merchant services provider umbrella. In some cases, an MSP may provide both payment gateway and merchant account services.

Merchant account provider: Your company will need a merchant account to accept credit and debit cards. The merchant account provider holds funds for you while bank authorization occurs. Once the authorization is complete, the money is transferred from the merchant account to your bank account.

A merchant account isn’t the same as a typical bank account. While the money in the account technically belongs to your business (provided the credit or debit card company approves the transaction), you can’t directly access the money and withdraw it as you would funds in your savings or checking account.

Instead, you must rely on the account provider to transfer the money from the merchant account to your business bank account. The merchant account provider subtracts any fees related to the transactions from the balance before transferring the funds to your bank.

You need to have a merchant account before you can accept credit and debit cards. Some merchant account providers also offer payment processing services and products such as card readers, point-of-sale systems and mobile payments.

Payment gateway: This merchant service allows your company to process credit and debit cards, as well as other types of electronic payments. Online shopping, in-store shopping and paying with a credit or debit card in-store wouldn’t be possible without payment gateways.

Payment gateways provide software that transfers data about a transaction between parties. When customers provide their credit card information online, that information travels along the payment gateway to the issuing and acquiring banks. The payment gateway encrypts the card information, protecting it from third-party interception.

How Does a Merchant Services Provider Work?

As the go-between for a business and a bank, the merchant services provider facilitates payment transactions. While a lot goes on behind the scenes when a customer makes an electronic payment, the process itself typically lasts just a few seconds. A merchant services provider goes to work once a customer provides payment information:

The MSP sends the payment information to the acquiring bank.
The acquiring bank passes on the payment details to the issuing bank to get authentication and approval.
The issuing bank either approves or denies the payment.
The approval or denial gets sent to the acquiring bank, which sends the information to the MSP.
If the payment is approved, the merchant account receives approval and confirmation of the transaction.
The money is transferred from the customer’s bank account or credit card to the merchant account.

Merchant Services Pricing

Several pricing models are available for merchant services. The exact pricing structure can vary based on your agreement with your MSP and based on the volume of your transactions, historical risk and claims in your sector and specifics of your operation.

How Quickly Can You Get Started With a Merchant Services Provider?

If you’re ready to work with an MSP, the first step is to gather the information the provider will need to review your company and confirm you’re eligible to receive its service. Providing as much information as possible on your application helps streamline the process, meaning you can start more quickly.

Some of the documents you’ll want to include with your MSP application are:

Your business tax ID
Your website
Your mailing address
Your business’s bank account information

What Types of Businesses Can CSG Forte Help?

If your business wants to accept more forms of payment, the team at CSG Forte can help. We offer merchant services for small- and medium-sized businesses. We’ll help your company accept electronic payments, including credit and debit cards, in-person payments, online payments and over-the-phone payments. You’ll get peace of mind that your transactions are secure, and your customers’ payment data is safe. If you have any issues with our merchant or payment processing services, our customer service representatives will assist. We help you with troubleshooting issues and provide tools to support you with customer disputes.

FAQs

Have questions about working with a merchant services provider? Check out our answers to some of the most frequently asked questions.

Do I Need a Merchant Services Provider?

If your business wants to accept credit and debit cards or other forms of electronic payments, you’ll need to work with a merchant services provider. While you’ll need an MSP, the type of MSP your business requires can vary depending on the services and the type of payments you want to accept.

What’s the Difference Between a Merchant Services Provider and Merchant Account Provider?

A merchant account provider is a type of merchant services provider. A merchant account provider can give your company access to a merchant account. Some merchant account providers also handle payment processing, but not all do.

What’s the Difference Between a Payment Service Provider and Merchant Account Provider?

A merchant account provider gives your company access to its own merchant account. Payment service providers can also provide access to a merchant account, but the account won’t exclusively belong to your business. Instead, a payment service provider groups businesses together and uses the same merchant account for them. Working with either a payment service provider or merchant account provider allows your company to accept electronic payments, although it typically takes longer to receive an account from a merchant account provider than to be approved by a payment service provider.

How Can I Know My Payment Platform Is Secure?

Security is critical. Customers want to feel confident their payment information is safe from hackers, and companies want to know that the MSPs they work with prioritize security. To ensure payment security, all payment details should be encrypted during transmission and when the system is at rest. Fraud management tools are also important, and the MSP should comply with all industry standards.

How Do I Choose a Merchant Services Provider?

Choosing an MSP can be a straightforward process. You need to assess your organization’s needs and determine which types of payments you wish to accept, then do your research and look for a provider that fits your needs. Also, consider how you want to accept payments, such as online, in person or over the phone. Pay attention to the security measures the provider has put in place, the fee schedule and the amount of customer support the MSP provides. It is useful to look for an MSP that can integrate with your existing systems or provide ample support to help you migrate over.

Choose CSG Forte for Merchant Services

Take the steps toward achieving a simpler payment process by choosing CSG Forte as your merchant services provider. Contact us today to start your application or learn more.

What Is ACH Prefunding?

Posted on May 5, 2025

Automated Clearing House (ACH) transactions are booming. In 2024 alone, the ACH network transferred 8.6 billion commercial and government direct deposit payments (totaling $15.8 trillion) for things like payroll, retirement distributions, Social Security and tax refunds. Imagine what would happen if the money wasn’t there to back those payments. Banks, who are ultimately on the hook, would be in hot water.

That’s where ACH prefunding comes in. Prefunding ACH transactions guarantees there’s enough money in the payer’s account before the payments are approved—reducing the credit risk and keeping the system running smoothly.

Keep reading to learn how ACH prefunding works and why it matters for banks, businesses and payees.

What Is ACH Prefunding?

ACH transactions refer to the electronic transfer of money between bank accounts. ACH transactions move funds electronically through the ACH network to cover a range of payments, such as direct deposit of paychecks, recurring bill payments and online purchases.

ACH pre-funding is a financial practice used primarily when processing ACH credit payments (when money is “pushed” from one bank account to another through the ACH network). To prefund ACH transactions, the financial institution debits the funds from the originator’s (the party sending the money) account in advance, guaranteeing sufficient funds are available to cover the outgoing payments.

How ACH Prefunding Works:

Initiation of ACH credit transaction: A company, agency or individual (the originator) initiates an ACH credit transaction to send funds to another party. This could be for payroll, vendor payments, Social Security payments or other large disbursements. The payer or the payer’s processing partner provides an originating depository financial institution (ODFI) with the payee’s account information, the amount to be sent, a categorization code and a target settlement date.
Funds verification: The ODFI verifies that the originator’s account has enough funds to cover the total amount of the ACH credit transaction.
Prefunding process: Instead of immediately sending the ACH transaction, the ODFI prefunds the transaction. This means:
1. The ODFI debits the originator’s account for the total amount of the ACH credit transaction—usually one or two days before the effective date of the ACH transaction (when the funds are intended to be available to the recipient).
2. The funds are then held in the ODFI’s settlement account until the credit file is released by the ODFI.
Settlement: On the effective date, the ACH network processes the transaction, transferring the funds to the receiving depository financial institution (RDFI), which then credits the recipient’s account.

What Are the Benefits of ACH Prefunding?

ACH pre-funding is a safety measure that adds a step in the ACH credit process to guarantee the availability of funds by debiting funds from the originator’s account prior to releasing ACH credits.  Prefunding ACH transactions decreases the bank’s credit risk associated with ACH origination by reducing the risk of the originator’s account having insufficient funds at the time of ACH prefunding settlement. If the originator doesn’t have sufficient funds in its bank account on the effective date, the ODFI is responsible for those transactions.

Prefunding ACH transactions offers several other advantages for financial institutions, businesses and recipients:

Guaranteed settlement: Funds are verified and secured before processing, eliminating the risk of rejected payments due to insufficient balances.
Lower return rates: Prefunding guarantees that the originator (sender) has the necessary liquidity, reducing ACH returns.
Faster settlement times: Prefunding ACH transactions supports smooth and timely settlement. Prefunded ACH credits often qualify for same-day or next-day availability of funds.
Better cash flow predictability: Businesses can accurately forecast outgoing payments without surprises.
Improved vendor and payee trust: Employees, suppliers and contractors get paid on time, strengthening business relationships.

What Are the ACH Originator’s Responsibilities?

In the ACH payment process, the originator is the individual, business or entity that initiates the ACH transaction. Originators have several responsibilities within the ACH process, including:

Authorizations: Obtain the proper authorizations from the transaction recipient to originate one or more entries to the recipient’s account. Provide authorization to the bank within a specified time, if requested to do so. Retain proper authorizations for at least two years following the termination of the authorization.
Security: Protect the recipient’s banking information. Protect sensitive financial data, including employees’ identities and credentials.
Account updates: Make necessary changes to the payee’s account information within a specified time frame or prior to the next origination, when notified.
Transactions: Send ACH entries on the correct date and cease entries when notified. Notify the recipient regarding changes in transaction amounts or dates. Prefunding ACH transactions minimizes changes in transaction dates.

What Happens if Prefunding Fails?

If the originator’s account doesn’t have sufficient funds for the ACH credit payment during prefunding, the bank sends a notification indicating the ACH transaction failed funding attempts. This notification will also indicate a specific date/time by which the originator must fund the account. If funding doesn’t occur before the cutoff, the ACH payment will fail and the originator must reinitiate the payment. If sufficient collected funds are still not available before processing begins on the evening before the file settlement date, the file may not be processed.

How to Reduce ACH Fraud Risk

ACH credits are becoming a prime target for business email compromise (BEC), a scam where fraudsters posing as executives or (more commonly) vendors send emails to trick employees into making unauthorized payments. According to the 2025 Association for Financial Professionals’ Payments Fraud and Control Survey Report, 63% of respondents cited BEC as the number one avenue for attempted and actual payments fraud, with ACH credits the second most vulnerable payment target (reported by 50% of respondents, behind wire transfers at 63%).

While ACH prefunding doesn’t prevent fraudulent transactions (it just makes sure the money is available for transfer), originators and financial institutions can take these steps to reduce ACH fraud risk:

Perform an internal risk assessment and controls evaluation: What types of controls are in place to combat ACH origination fraud?
Strengthen identify verification before sending payments: Know to whom the money is going before sending payments.
Implement security measures: It’s imperative that you protect employees’ computers and credentials.
- Regularly update firewalls and anti-virus, anti-malware and anti-spam protections.
- Protect and keep confidential all user IDs, passwords and authentication methods.
Send alerts: Do this when an employee’s password has been changed, or when an ACH credit transaction has been generated.
Monitor accounts online daily: Review the balances and account transactions so you are aware of all ACH transactions, even when they have not yet posted to your account. Early detection of fraud is critical to minimize the damage.
Use dual-approval procedures: One bank employee generates the ACH batch and a second employee logs in and approves the batch.

Send and Receive ACH Secure, Reliable Payments With CSG Forte

CSG Forte makes it simple to disburse funds and collect payments instantly and reliably via ACH transfer. You can make payments to a supplier, to your employees or as a refund to a consumer just as easily as you accept customer payments.

CSG Forte supports same-day payment options to make ACH transfers even more convenient. Our payment platform protects financial data and provides payment confirmation, offering account status validation and account ownership solution, as well. These features reassure users that payments reached the right recipient.

With CSG Forte, it’s easy to accept—and make—digital payments. Ready to get started?  Contact us today.

Debunking ACH Payment Myths: What You Should Know

Posted on April 16, 2025

What’s the most valuable non-cash payment channel in the United States? Most people would say credit cards—and most people would be wrong. It turns out  Automated Clearing House (ACH) payments are the most valuable non-cash payment channel. Even though more credit and debit card than ACH payments are transacted each year, ACH payments are worth much more on average.

While debit cards account for 81% of non-cash payments, ACH payments totaled $86.2 trillion in 2024. So, why don’t ACH payments get the (ahem) credit they deserve? Despite existing for half a century, there are still some persistent ACH myths. These include ACH payments taking too long or being too hard to set up.

Here, we’ll explore three popular misconceptions about ACH and explain both why they persist and the truth about ACH processing.

Let’s dig into each of these myths in more detail.

ACH Myth 1: ACH Payments Aren’t Viable for One-Time Payments

Consumers don’t know what ACH is, but they know how it affects their lives. It’s often how they receive their paychecks (via direct deposit) or how they make recurring utilities or government payments.

Businesses are much more familiar with ACH payments, which can be made over credit or debit. But what they may not be aware of is how to use ACH for one-time payments—and how it can save them money. Given that bank account information is saved and high fees can add up over repeated transactions, the appeal of ACH for recurring payments is clear.

Consider large transactions worth hundreds of thousands of dollars or more. No one wants to pay a 2.5% processing fee when that amount climbs to five figures. If businesses choose to use ACH processing on the backend, that means lower fees for the end customer.

Whether for real estate purchases, medical billing, bulk supply orders, or other large purchases, the fee difference between ACH and other types of payment processing can be sufficient reason even if it is only once.

Myth: Busted

ACH payments are viable for both recurring and one-time payments, especially when dealing with large transactions.

ACH Myth 2: Customers Don’t Want to Connect to Their Bank Accounts

You may have heard that most consumers are unwilling to enter bank account information and prefer to provide their credit card. This may be true for some, but given the growing adoption of digital wallets, making payments online can be much less work than writing a paper check. Instead of having to track and write out specific information each time, customers can choose a saved account to make a payment from.

While storing bank data can be a concern, more of your customers have their bank account information available than ever before. From a payee perspective, this simply looks like an automatic withdrawal from their account. When you choose to use ACH for your payment processing, you can benefit from the cost benefit of ACH processing without causing extra hassle for your customers. But convenience isn’t the only factor at play.

Even though consumers have become accustomed to processing and convenience fees, everyone likes saving money. When using ACH to power your payments, you can make transactions more profitable without passing the hidden fees associated with credit card payments onto them.

According to Jeff Kump, Head of Payments at CSG Forte, “We’ve heard from a number of clients that customers were happy to link their bank accounts, especially when it let them save money on fees for big purchases.”

Myth: Busted

Customers are happy to connect their bank accounts for ACH payments, even when the benefits are hidden in the backend.

ACH Myth 3: ACH Payments Always Take Between Three and Five Days to Process

ACH payments have a reputation for taking several days to process. Depending on the vendor, that can sometimes be the case, but it doesn’t have to be.

While many ACH processors do offer overnight and multi-day ACH processing, they can also process payments on the day they were made. According to Nacha, the organization that oversees all ACH payments, there were more than 1.2 billion same-day ACH transactions processed in 2024.

To account for the growing volumes and values, Nacha in 2022 increased the same-day ACH payment limit to $1 million. It seems likely that this trend will continue as the security and ease of same-day ACH payments are proven time and again.

Despite the convenience, only one vendor (CSG Forte) offers in-house same-day ACH capabilities. This isn’t to say that no other vendor offers same-day ACH capabilities, but only CSG Forte builds, maintains, and delivers this capability within the same organization.

Myth: Busted

While some ACH payments can still take several days, including those over $1 million or processed by certain vendors, it is possible to process ACH payments on the same day.

Confirmed: The Truth About ACH

ACH is a topic that can still be confusing, even for payments experts. We hope that this blog has cleared up a few of the most common myths about ACH payments. To recap:

ACH is great for one-time and recurring payments alike.

Customers have a low-effort way to connect their bank accounts for ACH payments.

With the right vendor, ACH payments of up to $1 million can be transacted on the same day.

At CSG Forte, we believe the payments experience can be simpler and more secure. Do you want to learn more about ACH and how it can help organizations like yours? Collect ACH payments cost-efficiently with CSG Forte.