Direct Payment offers companies a low-cost solution for retaining customers and collecting regular payments. After the initial costs of setting up a Direct Payment program, you immediately begin saving money in processing costs. Costs will vary but may include:

Setup

To use Direct Payment, your company will need to be able to create a specially formatted file for delivery to your financial institution. Most often, your financial institution will charge you a fee to cover setup and processing of Direct Payment transactions in a prescribed file format. Many of today's accounts receivable systems and electronic payment services offered by your financial institution are designed to aid in the preparation of this file, known as an ACH-formatted file.

File Transmission

This fee is typically determined by how often your company transmits a file to your financial institution.

Transaction Fee

This fee can be based on the number of transactions (payments) in your transmission file. Typically, banks and credit unions charge high volume companies less per transaction than companies with lower volume.

Returns

Direct Payment transactions may be returned from time-to-time for reasons like NSF, account closed, or if a consumer believes he or she did not authorize a payment. Your financial institution may assess a fee for handling these returns, much like it does for check deposit returns.

Cost Tips

Just like buying any service or product, it pays to comparison shop for your Direct Payment service. Your company may be able to minimize cost by including Direct Payment as an additional activity in your total account relationship. Another source for regional and national bank pricing trends is the Phoenix-Hecht Blue Book of Bank Pricing. This Web site in no way endorses any specific financial institutions or third party providers of ACH payments.