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How to Set Up and Use ACH Payments

Updated

Overview

ACH (Automated Clearing House) payments allow merchants to accept funds directly from a customer's bank account. This guide outlines how to set up ACH processing, either through our in-house application or by using another supported processor, and how to process transactions using various tools in your merchant portal.

Setting Up ACH Using the Digital ACH Application

If your Merchant Portal includes the Electronic Check (ACH) Application feature, you can apply for ACH processing through a streamlined, in-portal process. This in-house solution offers merchants an easy way to apply for a Paya Electronic Check (eCheck) processing account.

Note: If you do not see the ACH Application option in your Merchant Portal, please contact your Merchant Service Provider to request access to this feature.

How It Works:

  1. Log in to your Merchant Portal.
  2. On the homepage, under Virtual Terminal, click ACH Application or navigate via the left panel → Electronic Check → Go to Application.
  3. Complete the digital application form, which auto-fills much of your existing information.
  4. Upload the required documents.
  5. Review and submit your application.

Our ACH processor will review your application. Once approved, you’ll receive an email confirmation and your ACH processing account will be activated.

Required Documentation:

  • Three months of recent bank statements – The bank account number on the statements must match the account listed on the voided check or bank letter.
  • Business license – Acceptable documents include Articles of Incorporation, sales tax license, business utility bill, or a previous processor statement. The document must reflect the DBA or legal name and business address listed on the application.
  • Voided check or official bank letter – The voided check must have the DBA or legal name preprinted. If providing a bank letter, it must be on official letterhead, signed by a bank representative, dated within the last 60 days, and show the full routing and account number along with the DBA or legal name of the merchant.

Note: Only users with administrative or Virtual Terminal access will be able to see and submit the ACH application.

Using Other ACH Processors

If you're using a different ACH processor, you’ll need to apply directly with them and then work with your Merchant Service Provider to onboard the processor manually.

Important: Merchants do not have access to add processors directly. Please contact your Merchant Service Provider with your ACH credentials to complete setup.

Supported ACH Transaction Types

Once approved, you can process the following ACH transaction types:

  • Sale – Withdraws funds from the customer’s bank account.
  • Void – Cancels a transaction before it’s settled.
  • Refund – Returns funds to the customer after settlement.

ACH transactions are submitted in daily batches and typically settle in 3–5 business days.

Where You Can Use ACH Payments

You can accept ACH payments through several tools in your merchant portal:

  • Virtual Terminal – Manually enter a customer’s bank account info for a one-time or recurring charge.
  • Recurring Billing – Automate repeat payments using stored bank account data.
  • Customer Vault – Securely store and reuse customer bank account details.
  • Invoicing – Send invoices that customers can pay via ACH.
  • Collect Checkout & QuickClick – Enable ACH as a payment method at checkout.
  • Batch Upload – Submit multiple ACH transactions at once via CSV upload.
  • API – Integrate ACH processing into your custom applications.
  • Customer Fee Configuration – Apply convenience or miscellaneous fees to ACH payments via Virtual Terminal.

Best Practices for Successful ACH Processing

Following these best practices will help you get the most out of ACH payments:

1. Verify Customer Information - Double-check routing and account numbers before submitting transactions.

2. Use the Correct SEC Code - Make sure the SEC code matches how the payment was authorized (written, phone, or online). See our SEC Codes article for a full breakdown.

3. Maintain Authorization Records - Store signed agreements or recorded authorizations for at least two years in case of a dispute.

4. Monitor Return Rates - High return rates can result in penalties or account suspension. Track trends and identify root causes early.

5. Plan for Processing Delays - Build a buffer into your cash flow forecasts to account for weekends, holidays, or returned payments.

Common Questions

What do I need to complete the digital ACH application?
You’ll need to provide some business details and upload documents like bank statements, a business license, and a voided check.

How long does it take to get approved?
Most applications are reviewed quickly, with approvals typically issued within a few business days.

Can I use another ACH processor instead?
Yes. If you already have an ACH processor, share your credentials with your Merchant Service Provider so they can enable it on your account.

Need Help?

If you need help completing your digital ACH application or onboarding an external ACH processor, please contact your Merchant Service Provider.