Evaluating Ach And Eft Payments For Accounts Payable Automation
What Is The Difference Between Ach And Eft Payments
For accounts payable departments looking to automate workflows, determining the difference between ACH and EFT payments is an important consideration. By understanding the nuances each payment option offers, C-Suite executives can make the best decision to ensure optimization and cost-effectiveness. Here are the steps to consider when evaluating ACH and EFT payments:
1. Research. Researching the respective regulations, fees, and requirements of ACH and EFT payments is key when seeking an accounts payable automation solution. Familiarizing yourself with the two systems will allow for informed decision making when selecting the best fit for the organization.
2. Transaction Size. When comparing ACH and EFT payments, the size of the transaction is an important factor. ACH payments are best for businesseseeking to process small payments, as transaction fees for higher amounts can add up quickly. On the other hand, EFTs are best for making larger payments, as the fees are typically simpler and more straightforward.
3. Transaction Time. The amount of time it takes for transactions to process is also an important criterion to consider. ACH payments typically take 3-5 days to process whereas EFT payments process much more quickly, usually within 24 hours.
4. Security. In terms of security, ACH and EFT offer similar levels of safety, as both maintain federally regulated processes. Nonetheless, both payment systems should have verified encryption technology, as well as secured fraud policies and procedures in place.
5. Supporting Solutions. Selecting an accounts payable automation solution requires attention to any complementary systems it might have. Some solutions offer both ACH and EFT capabilities, while others work with third-party providers to ensure access to both payment options.
Ultimately, executives utilizing the accounts payable automation space should consider the scope and volume of their current and future payments, the security measures of each individual payment solution and the integrated software it works with when evaluating ACH and EFT payments. By researching the two payment options, executives gain clearer understanding of what works best for their organization.
