Choosing the right automated payment solution can make all the difference
Consider the scenario of an IT service provider accepting ACH payments through their business bank…
Let’s say they have 50 recurring monthly agreements with their IT clients that must be charged out of 50 different checking accounts.
This means that every month, this ITSP must go into their online banking account and modify a schedule for the dollar amounts out of those accounts that they want money withdrawn.
These dollar amounts can fluctuate from month to month, depending on usage, and depending on how many employees that end user has being supported at that time.
One month, an IT client’s recurring agreement invoice might be $1,000. The next month, it might be $1,100. This means that each and every month, the ITSP must go in and manually update the ACH file with the appropriate dollar amounts for each one of those clients.
You can imagine how much time that takes.
But wasted time isn’t only issue with accepting ACH payments through your business bank. Manually processing ACH payments also increases the potential for human error.
Think about it. If your ACH payments are being manually modified, there’s a greater potential to make a mistake.
Maybe you update the wrong account with a new amount.
Or an account that should have been modified is overlooked.
That ITSP is going to bill its clients the wrong amount.
Your ACH provider (business bank) has no idea that a dollar amount has changed on an invoice unless you go into the account manually and tell it so.
Depending on how many contracts an IT service provider has, you can imagine that it’s a pretty labor-intensive process. And it’s a process you have to go through each and every month if you accept ACH payments through your business bank.
Now, that doesn’t mean you want to avoid ACH altogether, because it does offer some serious benefits – namely, it allows you to avoid the 3-5% or higher transaction fee you face with credit card payments.
So, what are your options?
Instead of going through your business bank, you can implement an automated payment processing solution like ConnectBooster, which utilizes a third-party ACH service provider.
The benefit to this is that everything you would have to do manually, in terms of accepting ACH payments, can now be fully automated.
When looking for an automated payment processing solution, just make sure that the one you choose will automatically recognize modifications to the dollar amount on your IT client’s recurrent contract. If it doesn’t, you’ll still have do update any invoice amounts as they change from month to month.
You’ll also want a solution that is able to integrate fully with any PSA or accounting software you use (such as ConnectWise and QuickBooks).
With this capability, you can avoid auditing that ACH file every single month to make sure everything is correct on the billing. A solution such as ConnectBooster will automate and take care of the entire ACH payment process for you.
3 Ways to Apply This Information Now
- If you’re wondering how ACH might work for your IT company call ConnectBooster at 877-733-6584 to explore how you can utilize ACH to automate your process of getting paid. You can also email [email protected].
- Download the Take Control Of Your Business Finances ebook for more tips that will help your ITSP get paid on time…every time.
- Click to share this article on LinkedIn. Sharing quality content increases your visibility and credibility with your existing contacts, creating conversations and potentially new business.
