ACH & Check 21 Processing

The PayDiverse Walkthrough

ACH & E-Check Payment Processing Solutions

For high-risk merchants looking to offer their customers convenient payment options, ACH and Check 21 payment processing may be just the solutions they need. Accepting e-checks has shown to help merchants boost sales by up to 20%. This payment option opens up a merchant’s customer base by allowing people who don’t have credit cards – or who may just prefer using the money they already have – to shop conveniently online or over the phone. In the United States alone, there are over 30% of adults who do not have a credit card, while over 90% of adults have active checking accounts that they can use to make online purchases if the option is available. That is a huge market share that’s being missed by those merchants who only accept credit cards.


The Benefits of E-Check Processing for High-Risk Merchants

High-risk merchants with PayDiverse have the option of accepting e-checks through ACH or Check 21 either through their websites or over the phone. E-check is one of the fastest growing payment methods today among both merchants and customers.

Costs associated with processing ACH transactions are considerably lower than standard processing of credit and debit cards. A typical ACH fee is anywhere from 5 to 20% lower. ACH transactions are batched instead of being processed individually which contributes greatly to a reduction in fees. Because these transactions are batched, a merchant’s bank will see fewer transactions on the merchant’s statement, reducing exposure and increasing the stability of the merchant’s account. ACH transactions also tend to see a much lower dispute rate.

Customer loyalty increases a great deal for merchants who process e-checks. Many Americans either don’t have credit cards or prefer not to go into debt when making purchases, therefore paying through e-check, using the money they already have in their bank account, is the best option.

Recurring payments can be set up through ACH or Check 21 for merchants who offer subscription services, payment plans or memberships based programs. Recurring billing is simple to set up and can be withdrawn directly from the customer’s bank account on the same date each month. Set up can be done electronically and maintenance is minimal.


What is the ACH?

ACH stands for Automated Clearing House. The ACH is an electronic network that acts as an intermediary between banks throughout the United States. When a payment is processed through ACH, the merchant sends the transaction details including account details of both the merchant and customer, as well as the transaction amount, to the ACH who will gather and store this information throughout the day. At the end of each business day, the ACH will provide each bank with totals to be sent and received and which bank the transactions are with.

When funds are transferred via ACH they may take 24 to 48 hours to fully process. This is because ACH payments are not made directly between accounts, but rather from bank to bank. The ACH will take a day to process all payments, and each bank will need time to process once notified of funds to be sent or received.

ACH transfers are often limited per bank, and therefore merchants processing at particularly high volumes may prefer to use a combination of ACH and Check 21. Additionally, ACH will require a low chargeback and return ratio – if a merchant has a ratio higher than 0.05% then Check 21 will be a better option for their business.


What is Check 21?

Check 21 provides merchants with e-check options that go beyond ACH. A better option for high-risk merchants with chargeback and return ratios that are less than optimal, Check 21 provides flexible e-check processing to both low and high-risk merchants that allow for a variety of processing options.

Merchants may process payments through their own bank with Check 21, or they can opt to process through a payment processor, such as PayDiverse. Processing through a payment processor provides merchants with all the benefits Check 21 has to offer without any of the headaches that come along with e-check returns and insufficient funds. When chargebacks and returns are processed with Check 21 they are returned to the payment processor (when one is indicated) instead of the merchant’s bank, making Check 21 a safer option for merchants with a high rate of chargebacks as well.


How to Start Accepting ACH and Check 21 Payment

All high-risk merchants with PayDiverse are offered the opportunity to accept payments with ACH and Check 21. Getting started with PayDiverse is simple.

  1. Apply online using our secure application form.
  2. Digitally sign your applications.
  3. Electronically submit supporting documents.

That’s it! Our underwriters will review your application and verify your information, analyzing your prior account and credit history along with your industry, ownership and other details of your business. Within 24 hours, we will provide you with an answer in regards to your approval.

If approved, we can have your account set up and you will be ready to accept ACH and Check 21 payments via your website or over the phone within 48 hours. In addition to accepting e-checks, your high-risk merchant account features the following benefits:

  • Credit and debit card processing using our secure payment gateway
  • Award winning fraud protection that has been integrated into our payment gateway
  • Real-time chargeback alerts and chargeback protection
  • Chargeback dispute support
  • Offshore payment processing
  • Multibank payment processing


Increasing the Likelihood of Approval

If you are ready to apply for a high-risk merchant account with PayDiverse, there are a few things that merchants can do to increase the chances of account approval.

  • Ensure all bills are paid on time and no accounts are in arrears
  • Keep account balances high – negative balances may impact your application
  • Ensure all information provided on your application is truthful and accurate
  • Ensure that ownership of the business displays competency and professionalism


What Industries Can PayDiverse Provide Solutions For?

Whether you are a small start-up or a multi-national corporation, PayDiverse can provide you with long-term payment processing solutions that are designed to keep your business operating successfully. We work closely with over 40 banks both in the United States and offshore, meaning we can provide businesses in any high-risk industry with options specifically tailored to their needs. We are pleased to provide multiple banking solutions to merchants in a variety of high-risk industries, including the following:

  • Accounting and Bookkeeping
  • Automotive Roadside Assistance
  • Background Checks
  • Cannabis and CBD
  • Collection and Debt Agencies
  • Electronic Cigarettes
  • Furniture
  • Magazine Subscriptions
  • Matchmaking Services
  • Multi-level Marketing
  • Nutraceuticals
  • Payday Loans
  • Weapons
  • Web Design

Even if you don’t see your industry listed above, if you’ve been deemed a high-risk business, we can provide solutions for you. Contact us today and start processing ACH and Check 21 payments right away.

Diverse Payment Processing is Smart Processing

Fill out our free and quick merchant account application and let us match you with many banks that want your business.