Determining the type of payment system your business uses in B2B transactions is not always easy. There are so many different ways to transfer funds and process payments, and it can be overwhelming trying to figure out which one is right for your business.

Whether you are a business that handles a high volume of vendor or supplier payments or whether your business is a primarily online service, managing your finances is of the utmost importance.

The first step in deciding what type of payment method your business should use is knowing what options are available. In this article, we have outlined six major types of online payment methods available to you and explained the advantages of each type. Our goal is to provide you with key information about each type of payment process, including definitions of key terms, and walk you through the reliability and security of each method.

ACH Payments

If you are looking for a more secure way to transfer money, then ACH payments may be the smartest choice for your business. Before learning about the ACH payment process, it’s important first to know what “ACH” means and what it does.

What is an ACH Payment?

The Automated Clearing House network (ACH) is one of the largest payment systems in the United States, processing large amounts of both credit and debit transactions. ACH payment processing refers to any money transfer between banks that goes through the Automated Cleaning House network. Money is sent directly from the payee’s bank account, which often results in lower fees and faster transfer.

ACH Payment Transaction Types

The two main types of transactions the ACH Network processes are Direct Deposits, generally used for payroll purposes, and Direct Payment, used to transfer money to make a payment. Within these transactions, there are different methods of payment: ACH Credit and ACH Debit.

Both ACH Credit and Debit require the payee to authorize transactions to move or send money between accounts. ACH Debit transactions take money from a bank account to pay a debt, such as with automatic bill payment or reoccurring payments. ACH Credit transactions send money from one account to another, allowing you to process money transfers between multiple bank accounts. ACH payment processing allows you to automate your payments and quickly transfer money from one account to another.

Are ACH Payments Secure?

When it comes to transferring money, it’s important to know that your methods for payment are safe and secure. This is where ACH payments have a distinct advantage: according to NACHA, the Electronic Payments Association and trustee of the ACH Network, it is one of the safest and most reliable payment systems in existence. All ACH Network payments are protected under federal law in case of fraud or error.

How Much Do ACH Transactions Cost?

Many transfer methods can be costly, but ACH transfers are often less expensive than other methods of payment. Though processing payments are subject to your merchant or bank account provider, the ACH avoids service fees from card networks by using bank account and routing information directly. Some providers may add a fee or added cost to your transfer, ranging from $1 to $3 per transaction. It is a good idea to verify this with your bank to avoid any unexpected fees or delays in processing. To determine specific fees associated with your bank account provider, Nerd Wallet’s Transfer Fees by Financial Institution is an excellent quick resource.

How Long Does the ACH Transfer Process Take?

ACH transfer delivery can take several days, though a recent announcement by the National Automated Clearing House Association stated that same-day transaction processing would be available by early 2018. There may be an additional fee associated with same-day processing, but it would allow for an even faster transfer of funds between businesses and for employer payroll processing.

In the meantime, you can expect a delay of up to two business days for ACH payments to process for most financial institutions.

There are definite advantages to using ACH transfers as your primary payment process. For secure, inexpensive, and fast payment processing, using ACH transfers is a verified method backed by a reliable institution and used by many online vendors.

Send Money by Wire Transfer


Speed can often be an important factor in considering payment options. If you are looking to transfer money immediately, then a wire transfer is the safest and most reliable way to do so. A wire transfer is a method of transferring money from one group to another, either through bank accounts or transferring cash through a third party vendor or service. Wire transfers are particularly useful when transferring money to a person or business internationally because money can be made available right away and does not require a bank account.

Bank wire transfers require specific information about the bank account that will receive the funds. For transferring money without going through a bank, a nonbank wire transfer allows the receiver to pick up their transferred money at a cash office.

How Long Does a Wire Transfer Take?

The biggest benefit to wire transfers is that the funds are available almost immediately to the receiver. Funds process within one to two business days, though there are same-day transfer options available.

Nonbank wire transfers, especially for international transfers, can take a few extra days depending on the service provider and location. The added benefit here is it allows you to avoid additional bank fees on either side of the transaction.

How Expensive is a Wire Transfer?

Wire transfers may be a reliable and fast way to send money, but it is often costly and incurs fees on both sides. Depending on whether funds are being transferred within the U.S. or internationally, you may be charged fees for sending, receiving, or both. The Nerd Wallet compiled a list of average fees for wire transfers, taking into account both domestic and international fees, which averaged out to between $9 and $25 for domestic and between $10 and $44 for international.

Is Sending or Receiving Money by Wire Transfer Safe?

Wire transfers are usually considered to be safe and reliable. Bankwire transfers require both participants to have a bank account, which can cut down on potential scammers. Money transfers immediately, so the recipient does not have to worry about bounced checks or delayed payments. Banks catch wire transfer errors, such as insufficient funds or incorrect account numbers, before sending a payment, so there is little risk in accepting a wire transfer into your account.

One downside of sending a wire transfer is you cannot retrieve the money once sent; you cannot stop a wire transfer after you send it. It is important to know how to set up a wire transfer and take the proper steps in ensuring you have the correct information for the recipient. The Balance, a group providing expert advice about finances, has an in-depth guide to bank wire transfers that thoroughly explains the process.

In terms of speed and reliability, processing payments by wire transfer works well for business-to-business payments. However, it can cost quite a bit of money and can contain a certain amount of risk. That is why it is crucial to pay attention to the bank account information you have when sending a payment since it is not possible to rescind payment.

EFT: Electronic Funds Transfer

An Electronic Funds Transfer, or EFT, is the electronic transferring of money from one bank account to another, often called electronic banking, direct deposit, bank wire transfer…The list goes on. It can get confusing to know what difference, if any, exists between any of these payment types.

EFT is an incredibly broad term used to describe any electronic transfer of money that is not initiated directly by a bank, like direct deposit transactions, automatic bill pay, and ATM withdrawals. Think of payroll processing or a reoccurring membership fee as examples of EFT, which are often initiated by the payee but then automatically transferred without the direct intervention of the bank.

Many companies rely on EFT to directly deposit paychecks into employee’s accounts, and many people use EFT to pay utility or other bills. There are a variety of services provided by EFT, which basically includes any online transaction or money transfer that exists.

Why Use EFT?

EFT payments are more secure than credit card payments or paper checks since recurring payment into a bank account requires account verification. EFT is more reliable than paper checks, which can get lost or stolen in transit, and is considered more environmentally friendly.

Electronic funds transferring has allowed banks to adopt a digital banking system rather than a paper one, which is more efficient, reliable, and secure. Transferring money online is easy with EFT, leading to a better market for businesses selling merchandise, services, and other products online.

On the other side of business-to-business payments, vendors or clients can send payments using an e-billing method, which sends payment information to your business electronically. Processing electronic payments through e billing is often easier on your accounts payable department, because it allows them to quickly track digital data, update audit records, and verify payment information.

Electronic Funds Transfer is a term that is often used interchangeably with ACH transfers, as described by Forte’s payment basics article. Both of these transactions occur by transferring money from one bank account to another. Credit card payments, automatic payments, and direct deposit transfers are all considered EFT payments. Understanding this will help in the future when you see the term EFT used in conjunction with any other form of online payment.

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Pay Checks Online Using Electronic Check Payment

You may have heard of eChecks or even been asked to send an electronic check payment. Most online vendors accept electronic check payments, and many prefer them. So what exactly is an eCheck and how is it any different than other methods of online payment processing?

Defining the Electronic Check

Simply put, an electronic check is a digital version of a paper check that transfers money directly from one checking account into another. It is considered to be an Electronic Funds Transfer (EFT) that relies on established guidelines set by the traditional checking system. Using eChecks is safe and secure, and is the only electronic payment method that is backed by the United States Treasury.

How Does Electronic Check Payment Work?

These eChecks take bank account information from the payee and uses it to move money into another checking account. The process itself mimics paper check processing, but is far more efficient: money is taken from one bank account, transferred using the verified and secure ACH Network, and then placed into the receiving bank account.

You can opt to transfer funds digitally using an eCheck process by taking information from a physical check manually or by photo capture and sending it to your account digitally. Forte’s ACH and eCheck Guide further describes this at length, and by this method, you pay your vendors faster, and your check clears immediately.

Offering electronic check payments is considered to be a “merchant service” provided by banks, allowing customers to quickly process, pay, and receive money from their checking accounts. Other merchant services include online credit or debit card processing, wire transfers, ePayables, and other types of ACH payments.

Why Use or Accept eChecks?

You might wonder why your business should accept check payments online or pay using eChecks. The benefit of online check payments is that you can collect and store the same type of information you would get from paper check payments. Your business transactions will include information about the payee, the payee’s account and routing information, and historical data for your financial records.

With electronic check payment, you receive the same security as traditional banking methods with the added convenience of transferring funds online. You can choose to stop payment processing or settle disputes directly through your bank, which eliminates headaches of working with a separate online vendor to resolve issues.

If we are talking about benefits of specific business-to-business payments, it is important to look at speed as well as security. As with most digital transactions, eChecks process much faster than traditional checks, since account information can be verified online without the need for a manual review of paper check. For this reason many vendors opt to send invoices through e-billing because it eliminates the need for paper checks and paper audit trails.

Electronic check payment allows you to securely and quickly process transactions to and from your business. It can help keep your financial records updated, your clients paid in a timely fashion, and your business running smoothly.

Automate Payroll and Payments with Direct Deposit

Direct Deposit simplifies payments for any business regularly paying employees or vendors for services. With direct deposit, electronic payments can be made directly to a bank account, eliminating the need for paper checks or initiating payments manually. The funds are made available to you right away, and inversely funds are taken from the payee immediately. Banks with online banking systems – so most major banks – then offer their customers information about their available funds right away.

In fact, it is such a fast and reliable method for sending money that the government often uses it for income tax refunds and other types of returns.

Why Use Direct Deposit?

As a business, utilizing direct deposit saves an enormous amount of time and money. No need to make regular trips to the bank to deposit checks, no need to issue paper checks to employees, no worries about checks getting lost in the mail or transit. If you are paying vendors, employees or other businesses that are located out of state, using direct deposit means you will never be faced with a check being put on hold and inadvertently issuing a late payment.

Since direct deposit relies on bank account and routing information, you can choose to send funds to any type of account. Employees can opt to send direct deposit payments to their savings account, which is a common money-saving strategy as recommended by financial advisors.

If your business does not currently offer direct deposit to employees or regular vendors, it may be a good idea to start. Direct deposit is easier for both sides, allowing payments to transfer seamlessly between accounts and funds to be available much faster.

Recommended: ePayments via Virtual Card
Secure, Controlled Payments

Virtual cards are becoming increasingly popular as a better business-to-business payment solution. The name describes its biggest feature: it is a card that exists only in the online world. Virtual cards are tied to actual card numbers and bank accounts, but allow companies to maintain better control over their use, set limits, and maintain additional payment data than using other types of electronic payments. Let’s begin by first explaining what virtual cards are and how they work.

What are Virtual Cards and How Do They Work?

A virtual card is not a card at all. Virtual cards contain card numbers that are different from the user’s debit or credit card numbers. These cards are generated for business payment purposes and often expire within a set amount of time. These cards contain company-chosen pay limits, preventing vendors, suppliers, or employees from exceeding a specified amount. You use virtual cards much like other payment forms, though their common use is for online business transactions.

The three most commonly used virtual cards are single-use cards issued for one-time payments much like gift cards; authorization-only virtual cards that are linked to a corporate card account; and a lodge card, which is given to a vendor with a set limit to pay invoices for services or products.

Virtual cards are similar to ePayables programs in that both opt to replace paper checks with money processing directly through credit card information, though virtual cards do offer tighter restrictions and control than ePayables.

Why Use a Virtual Card?

It may sound like virtual cards are unnecessary for business-to-business transactions if you trust your vendor. However, setting credit limits is often necessary for financial tracking purposes and for maintaining control over outgoing money, even to reliable companies. For these reasons, it is becoming more common for businesses to use virtual cards for most or all of their transactions. Major car company Visa is noticing this trend and has recently announced a partnership with a virtual card company to bring them to more businesses.

Using a virtual card eliminates the risks that come with using physical credit or debit cards, particularly for online payment processing. Companies do not need to provide account information for vendor invoices or any other sensitive financial information with virtual cards.

What is a Purchasing Card?

A purchasing card, often referred to as a P-card, is a type of company credit card given to employees to make business purchases. Businesses can put tight restrictions on the card, such as spending limits and business location limits. You can even set up a P-card that can only be used for one specific vendor or type of service, and inversely set a card to block certain types of purchases.

Purchasing card statements, unlike other credit card statements, include a great amount of detail, such as a description of the purchase, amount paid, tax paid, and location of payment. These details help AP departments quickly process financial information and electronically reconcile payments without needing additional paperwork. This helps streamline your AP process and maintain pristine financial records.

Why Use a P-Card?

The biggest advantage to using P-cards as a business is the amount of control you have over company spending. It is easy to control your finances if you know exactly how much money is coming in and going out. Another benefit of a P-card is it eliminates the need for employees to create and process purchase orders, which means services and goods are delivered faster.

Reducing paperwork is always a good thing, as it saves your company time and money, not to mention avoids costly mistakes when paperwork is misplaced or missing information.

For vendors, paying with a P-card guarantees payment since it is a form of credit and processes right away. This means vendors are paid quickly and can also avoid needing to create invoices and process paperwork. It’s a win-win for both sides and makes the entire process of making business purchases much easier.

Advantages to Single-Use Virtual Cards

There are many reasons to consider using virtual card payments. FIS Global, an international provider of financial services, published an extensive report on the many advantages of virtual card payments. As outlined by them and many other financial services leaders, the advantage single-use cards have over other payment methods is that they give strict control over individual payments.

Single-use cards can only be used one time and become invalid after use, meaning vendors cannot process unauthorized payments. Payments are associated with specific virtual card numbers, so tracking payments and accompanying invoices is much easier. Comparing the advantages and disadvantages, as done by B2B Pay’s virtual cards analysis, is a good way to determine whether or not you feel it is worth the effort for your company to adopt virtual cards.

The future of business-to-business payments will include a rise in virtual card use for payments. There is a distinct advantage for businesses that want tighter control over their finances and are looking for a way to capture more accurate and detailed information about their expenses.

With major companies getting on board with virtual card payments and partnering with companies supporting them, now is the time to consider this secure payment method.


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