Does PayPal Accept ACH Payments? Everything You Need to Know

Many small businesses may prefer to receive automated clearing house (ACH) payments. This payment method is quick, convenient, and generally cheaper than other payment options. Luckily, companies that use PayPal can offer their customers the option to receive ACH payments through PayPal.

Does PayPal Accept ACH Payments?

An ACH payment allows an individual to transfer money electronically from one bank to another bank in the United States. This option can be a quicker and more cost-effective option relative to checks or credit card payments.

There are two types of ACH payments, which include an ACH credit and an ACH debit. A company can use an ACH credit to send money to another account, such as an employee’s account or a vendor’s account. Companies can also complete an ACH debit, which allows them to pull money from a customer’s account.

Paypal Business Solutions can help small businesses that need to receive ACH payments. Moreover, it also provides other convenient options like credit card and debit card payments.

How to Accept ACH Payments with PayPal

It is relatively easy to send and accept ACH payments with PayPal. Companies can use PayPal to receive ACH payments from their customers when they buy products or subscriptions. Moreover, they can use Paypal Merchant to view reports about submitted payments.

When you use PayPal to make an ACH payment, PayPal will first move the money from your customer’s account, and then move this money to your account.

Before you complete an ACH debit or credit, you will need to supply information such as:

• personal information, banking information, and the routing number.

Paypal allows you to receive one-off or recurring payments from your customers through Paypal’s ACH payment service. Before doing this, customers need to authorize you to debit their account. After this, the customer completes all of the information and schedules a payment. This payment is submitted to the originating depository financial institution (ODFI).

PayPal customers who use Braintree can use PayPal to send and receive ACH payments. This is a convenient service, which is also highly secure and allows users to receive ACH payments. PayPal customers can go to their control panel to make sure ACH direct debit is enabled, and then add a verification method.

What to be Aware of When Accepting PayPal ACH Payments

One important thing to remember is that it is important to be on the lookout for ACH fraud. According to Stripe, around 30%¹ of organizations faced ACH fraud in 2022.

It is easy for someone to commit ACH fraud if they gain access to your banking information. All this person needs is your account number and routing number. Moreover, someone can also commit this type of fraud if they gain access to your login credentials. These individuals can set up many types of fraudulent payments, including recurring payments.

There are many ways to help prevent ACH fraud. It is crucial to make sure that no one gains access to your account number and routing number. Moreover, it is also very important to make sure your login method is secure. It may be a good idea to set up two-factor authentication to reduce the risk of fraud.

Another issue that sellers may face is merchant fraud. Tools like PayPal Seller Protection can help protect your business from merchant fraud.

Businesses can contact Paypal’s customer service if they begin to notice any suspicious charges. Paypal also offers other services to help sellers, such as dispute resolution. In some cases, PayPal can help mediate during complicated situations.

Discover Wise Business: The Easy and Low-Cost Way to Receive Business Payments

Wise Business can be a great option if you need a convenient way to make or receive payments. If your business processes a lot of international payments, then Wise can help you send and receive payments at the mid-market exchange rate.

What's more, same-currency Wise to Wise payments are free. So if your customer also has a Wise account, there are no fees for receiving payments. People can send same-currency payments directly to your Wise Account in a flash.

Wise is not a bank, but a Money Services Business (MSB) provider and a smart alternative to banks. The Wise Business account is designed with international business in mind, and makes it easy to send, hold, and manage business funds in 40+ currencies. You can get major currency account details for a one-off fee to receive overseas payments like a local. You can also send money to 160+ countries.

Register with Wise Business 🚀

Some of the main benefits of using Wise include the following:

• No monthly fees,
• Mid-market rate for international payments,
• Easy batch payments,
• Ability to manage multiple currencies and hold up to 40 currencies,
• Can connect to QuickBooks and other accounting software for easy account reconciliation.

Click here to learn more about Wise Business, which is already trusted by more than 600,000 companies worldwide.

Sources

1. ACH fraud 101: How these scams work and how to prevent them