Automated Clearing House (ACH) transactions are a convenient and secure method for transferring funds electronically between bank accounts. However, to ensure smooth and successful ACH payments, it is crucial to follow a few essential steps, especially when using payment processors like Stripe. Below, we outline the key actions necessary for seamless ACH transactions.
Step 1: Verify Bank Account Information
When clients add a bank account, the verification process involves receiving microdeposits. These are small amounts deposited into the client’s bank account by Stripe to confirm that the account is active and correctly linked. Clients must:
Check Their Bank Account for Microdeposits
Within 1-2 business days of adding the account, the client should see the microdeposits in their bank statement.
Enter Microdeposit Amounts in Stripe
Log into the platform and navigate to (Invoices tab→Add payment method) and input the exact amounts of the microdeposits. This step completes the verification process and enables ACH transactions.
Step 2: Authorize Stripe with the Bank
To facilitate ACH payments, it is essential that the client’s bank recognizes Stripe as an authorized entity. Clients should:
Check Bank Policies on Third-Party Payment Processors
Some banks require additional authorization or whitelisting of third-party payment platforms to allow ACH transactions.
Contact Their Bank’s Support Team
If necessary, clients should inform their bank that they will be using Stripe for ACH payments and provide any required details or documentation.
Confirm Bank Account Settings
Ensure there are no restrictions, such as daily limits or international transaction blocks, that could hinder ACH payments.
Step 3: Understand Processing Times
ACH transactions are not instantaneous and can take 3-5 business days to process. Your admin team should plan charging your clients accordingly to avoid delays or disruptions. Stripe’s interface typically provides updates on the transaction status to help clients track their payments.
Step 4: Maintain Accurate Bank Account Records
Keeping bank account details up-to-date is vital for avoiding failed payments or delays. Clients can update their bank information at any time on the platform. If a client has updated their bank information, your admin team should:
Go into Stripe and ensure it is set as the default payment method.
Step 5: Monitor ACH Transactions
Clients and admins should actively monitor ACH transactions. Common reasons for failures include:
Insufficient funds in the account.
Incorrect bank account or routing numbers.
Account not eligible for ACH transfers (e.g., savings or certain business accounts).
The bank has blocked the transaction because Stripe was not correctly whitelisted.
In case of any problem, Stripe provides support and guidance for troubleshooting. Admins should also add help@fromwolf.com as a developer account on their Stripe.
Conclusion
By completing the necessary verification steps, authorizing Stripe with their bank, and maintaining accurate account information, clients can ensure successful ACH transactions. Additionally, being proactive about monitoring and understanding processing times will help minimize potential disruptions.
To enable ACH, please reach out to the WOLF team via Intercom or help@fromwolf.com.