What All Businesses Should Know About ACH Processing: Possible Risk Factors and Ways to Handle Them

Making use of ACH processing to accept online payments has several advantages for your company, in particular: more on time payments; quicker access to payment funds as compared to dealing with traditional debit/credit payments; less excess expense in the form of postage, paper, as well as telephone staff; and less late fees for clients. Still what are the risk factors with ACH payments? Do they exist? Unfortunately, the response is yes. But you can make certain they don't actually create problems for your company. Below, we list three typical risk factors for your payments, and what your business can do to prevent them.

1. Fear of Data Loss

Any ACH system entails the collection and storage of a large amount of customer and company data, a body of information which, if lost, could quite possibly take substantial time and expense to recoup. Companies lose their ACH data-and other kinds of information-in 4 primary ways: building fires, building flooding, power surges, and theft of data storage hardware. To prevent these kinds of tragedies, the solution is storing your data off site via a software as a service (SaaS) provider or merchant service which offers encoded information storage. Along with making your data retrievable following one of the events above, off site storage also saves more money compared to on site storage, which brings these costs: software and hardware costs, set up and maintenance costs, and software and hardware upgrade costs.

2. The Danger of Internal Theft

According to an August 2007 report on information theft by Data Monitor, 61% of data breaches occur via internal sources, not external ones. In addition, the U.S. Chamber of Commerce estimates that 75% of all employees steal at least one time, and that 37.5% of people that steal once will steal again. Such statistics leave companies with a tough decision: to treat their employees with trust, or assume that many of them are looking for opportunities to steal. Concerning info theft, the simplest way to prevent it internally is having a firewall skilled at detecting behaviors of malicious activity from within as well as from without. If this type of firewall doesn't currently safeguard your business' intranet, implement it immediately.

3. The Danger of Fine Print

In case your business uses automatic ACH payments following an initial sale without disclosing this in bold print, it could be asking for trouble by means of customer reviews. A search of consumer critiques at major retailers such as amazon.com and also independent consumer review websites show the dissatisfaction customers experience when billed for refill shipments they didn't anticipate receiving. Rather than plant your own personal reviews to fight damaging consumer reviews, it's best to be upfront about your own billing practices. After all, if the product or service is all that you claim it is, why shouldn't you be?

While conducting research for this article, I learned about ecommerce credit card processing and internet merchant accounts at www.avpsolutions.com.