They're willing to provide that authorization because they see it as a secure service that lets them pay automatically, usually via transfers from their checking or savings account, without needing credit cards or risking late fees. Businesses use them to collect:Ĭustomers have to provide their information, including routing and bank account numbers, and agree to be billed via ACH debit. Companies often use terms like "autopay" or "ACH" rather than "ACH debit." What are the different types of ACH debit?īecause an ACH debit is initiated by the payee and pulls funds into their own account, consumer businesses often use it to collect money they're owed. They're actually closer to paper checks in that regard, offering another form of payment distinct from credit/debit transactions. Even though both credit and debit card transactions are electronic, ACH debits are used explicitly for bank account transfers. Is ACH debit related to debit cards?ĪCH debits aren't related to debit cards in any way. Senders can correct accidental payments with an ACH debit reversal. The process takes one to three business days, though the exact time can vary based on the receiving bank. The ACH network submits transactions at 6 a.m., 12 p.m., 4 p.m., 5:30 p.m., and 10 p.m.
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