ACH, Credit, Checks: Which One to Choose?

Ach credit checks

In today’s digital age, financial transactions have evolved significantly, offering various options for making payments. This article aims to provide an objective comparison of three common methods of payment: ACH (Automated Clearing House) payments, credit card payments, and checks. We’ll delve into their processes, fees, and advantages, considering different perspectives to provide a well-rounded analysis.

ACH Payments

ACH payments have become an integral part of modern financial transactions, allowing for seamless transfers of funds between bank accounts. ACH transactions are processed through a network that connects all banks within the United States, enabling electronic money transfers without the need for paper checks, wire transfers, or credit card processing. This method offers several benefits:

Cost-Effectiveness: ACH payments typically involve lower fees compared to credit card transactions, making them an attractive option for businesses looking to reduce processing costs.

Recurring Payments: ACH is well-suited for recurring payments and subscriptions, offering convenience for both businesses and customers.

Security: ACH payments have a lower rate of fraud compared to credit cards, providing enhanced security for transactions.

However, some limitations exist:

Speed: ACH payments may not be ideal for urgent transactions due to the processing time involved. ACH payments may take 3-5 business days to complete along with this same-day and next-day processing options are available but for an additional cost.

International Transactions: ACH is primarily limited to domestic transactions and may not be suitable for businesses with international customers.

Table 1: ACH Payment Fees

Expense/Fee Type                Range                                     Description                       
Flat Fees$0.20 – $1.50          Flat charges per transaction   
Percentage Fees 0.5% – 1.5%Percentage-based charges on transaction value   
High-Risk Businesses  Higher Amount  Additional fees for businesses classified as high-risk
Account FeeVaries        Maintenance of payment processing account  
Processing Fees  VariesSending payments to ACH network and recipient’s 
Debit Fee  $0.20 – $1.50For ACH debit payments from customers to businesses
Credit Fee $0.20 – $1.50       For ACH credit payments from businesses to employees, vendors, or third parties.
Discount Fee  VariableAdditional fee on high-risk payment transactions          
Setup Fee  VariesOne-time setup fee for some processors        
Monthly Fee $5.00 – $30.00     Separate or inclusive fee for using ACH processing
Batch Fee Under $1.00 per batch     Charged for batching ACH transfers      
ACH Return Fee$2.00 – $5.00           Fee for returned ACH transfers
ACH Chargeback Fee$5.00 – $25.00          Fee for customer-disputed payment 
High-Ticket Surcharge VariesExtra fee for purchases over $5,000             
Expedited Processing Fee VariesAdditional fee for expedited processing     

Source: PaymentCloud Inc.

Credit Card Payments

Credit card payments have revolutionized the way we make purchases, offering speed and convenience. With credit card processing fees varying based on factors like card network and transaction type, businesses need to consider both advantages and drawbacks:

Instant Transactions: Credit card payments offer real-time processing, making them suitable for time-sensitive transactions.

Global Reach: Credit cards are accepted internationally, catering to businesses with a diverse customer base.

Rewards and Perks: Credit card users often benefit from rewards programs and perks offered by card issuers.

Fees: Credit card processing fees can vary based on the type of card, card network, and transaction type. These fees can include interchange fees, assessment fees, and payment processing fees.

However, credit card payments have their downsides:

Higher Fees: Credit card processing fees can be higher compared to ACH payments, impacting a business’s bottom line.

Chargebacks: Businesses may face chargeback disputes, leading to potential losses and additional administrative work.

Security Concerns: While credit card payments are secure, data breaches and unauthorized transactions can pose risks.

Table 2: Credit Card Payment Costs

Expense TypeDescription
Average Processing Fee1.3% to 3.5% per transaction, depending on payment company and card type
Debit Card TransactionsTypically cost less than credit card transactions   
Assessment Fees  Varies by payment provider

-American Express: 0.15%
-Discover: 0.13%
-Mastercard: 0.1375% for transactions under $1,000; 0.01% for transactions of $1,000 or more
-Visa: 0.14%

Interchange Fees   Average range of 1.15% to 3.3% per transaction
Additional Fees   Includes Acquirer Processing Fee (APF), Fixed Acquirer Network Fee (FANF), Kilobyte Access (KB) Fee, Network Access and Brand Usage (NABU) Fee, and others as applicable

Source: Business News Daily 


Despite the digital revolution, checks remain a familiar payment method. Writing a check involves issuing a draft that directs a bank to pay a specific amount to the payee. Checks offer certain advantages:

Physical Record: Checks provide a tangible record of transactions, offering an alternative to digital methods.

Control: Check writing allows payors to have greater control over the timing of payments.

Personalization: Memo lines on checks enable additional information to be included with the payment.

However, checks also have drawbacks:

Processing Time: Checks can take time to clear, delaying access to funds.

Bounced Checks: Insufficient funds in the payor’s account can result in bounced checks and penalties.

Manual Processing: Checks require manual handling and processing, which can be time-consuming and costly.

Despite these drawbacks, checks remain relevant in the modern era, thanks to innovations like check printing software.

To streamline the process of writing and managing checks, check printing software has emerged as a valuable tool. This software enables businesses to print checks with accurate information, reducing errors and saving time. Features may include customizable check templates, integration with accounting software, and security measures to prevent fraud.

Table 3: Check Payment Costs

Expense typeDescription
Material Costs-Includes paper, ink, and printing expenses for checks.
-$0.21 per blank check, $2.13 per pre-printed check.
Processing and HandlingVaries from manual processing and handling costs
Check Printing SoftwareUse of software for streamlined check management, reducing errors, saving time, enhancing security. Cost varies based on software used.
MICR Printing and TonerToner and printing expenses

Savings and Benefits of Printing Your Own Checks:

Improved Efficiency:  Reduces labor costs.

Automated Solution Savings:  Up to 82% reduction in costs.

Estimated Savings (3-year):  Approx. $307,540.

Estimated Savings (5-year):  Approx. $511,900.

Source: Technologies Blog

In Conclusion:

Each payment method—ACH payments, credit card payments, and checks—has its own strengths and weaknesses, catering to different business needs and preferences. ACH payments are great for saving money and staying secure, credit card payments are super fast and work everywhere, while checks offer a classic way to pay. And now, with the help of check printing software, checks have gotten even better—they’re affordable, save time, and are extra safe against fraud. So, when businesses decide how to handle payments, they can pick the best way that fits their style and what they need.

As you evaluate which payment method aligns with your business requirements, it’s crucial to consider factors such as fees, processing time, security, and customer preferences. Ultimately, the optimal payment strategy will depend on your business model, customer base, and financial goals.