How Payroc’s ACH Solution Handles Cash and Check Payments

Blog 2022

When developing omnichannel payment solutions, it’s easy for ISVs to focus on credit card, debit card, digital, and alternative payments. But don’t forget that many merchants and businesses also need the ability to process cash and check payments. To do that, ISVs need an ACH (Automated Clearing House) partner that offers the most flexibility and adaptability for growth.

In this blog, we will delve into how ACH payments work and explore how Payroc’s ACH solution simplifies cash and check transactions in both B2C and B2B scenarios.

Understanding ACH Payments

ACH payments are similar to credit card payments in that there are key players involved in completing the transaction. For credit card payments, players include the credit card issuer (Visa, Mastercard, AMEX, etc.), the acquirer, and the payment processor.

Processing ACH payments involves similar, but slightly different players:

  • Originator: the entity that originates the payment the ACH file
  • Receiver: the entity that receives the ACH file along with instructions on how to debit or credit the account
  • Payment processor: the entity that facilitates connections between originators and receivers

In the credit card processing world, there are a limited number of issuers. However, the ACH world has over 9,000 banks. That means, at any given time, hundreds of millions of transactions are processed. This involves people paying invoices, employers sending and employees receiving paychecks, and merchants and government agencies sending and pulling money out of bank accounts via ACH.

How the ACH Process Works


As we stated earlier, ACH payments are initiated by an originator, which can be a merchant, a financial institution, and even a consumer. For merchants, this often involves sending payments to employees, suppliers, or service providers, or may involve receiving payments from customers.


There must be authorization from the originator to the receiver before an ACH payment can be initiated. Usually, this involves collecting banking information, including the receiver’s account number and routing number.

Transaction Creation

Upon authorization, the originator’s bank creates an ACH transaction, which includes the payment amount, the originator’s banking information, and additional details. The difference between cash and check processing via ACH networks is the additional step of remote capture and transmission of the physical check. All information is then sent through an ACH network.

ACH Network Processing

The ACH network routes the transaction to the receiver for verification and processing. Again, networks like Pay ACH/AFT process millions of transactions every day, making sure that payments are secure and completed efficiently.


Upon receiving the transaction, the receiver verifies its authenticity. If everything checks out, the funds are transferred and the originator is then notified of the successful payment.

ACH payments have applications in both B2B and B2C scenarios.

How Businesses Utilize ACH Solutions

ACH payments are critical for businesses rely on cash and check payments. Here are some examples of applications:

Online Payments

By integrating ACH functionality into the checkout process, online businesses can give their customers the options to pay by cash electronically. This is a convenient option for customers who don’t want to increase credit card debit, and it can reduce processing fees for businesses.

Subscription Services

Customers can set up recurring ACH payments for subscription-based services, which reduces the chance of missed payments and increases customer retention. However, merchants do need to be wary of the type of friendly fraud where customers forget about their recurring payments.

Bill Payments

Utility companies, healthcare providers, and other service-oriented businesses leverage ACH payments. Not only does it streamline the billing process and reduce physical invoices, ACH can accelerate payment collection.

B2B Payments

Businesses can use ACHeck21 to pay their suppliers more efficiently. This not only accelerates the payment process but also strengthens relationships with suppliers by ensuring timely payments.

Receivables Management: ACHeck21 simplifies the process of receiving payments from other businesses. Companies can send electronic invoices, making it easier for clients to pay promptly.

Enhanced Cash Flow: The fast and secure nature of ACH payments means businesses can better manage their cash flow. Predictable payment timelines and reduced processing times contribute to improved financial planning.

How Pay By ACH Gives ISVs an Advantage

Payroc’s ACH solution, Pay By ACH (Pay by AFT in Canada) is a comprehensive platform that leverages cutting-edge technology to streamline ACH payments, making them faster, more secure, and more accessible for businesses.

Pay By ACH processes over 22 million cash and check capture transactions each year, working with more than 30 banks and financial institutions. And as we pointed out earlier, Pay By ACH serves as both a payment processor and a receiver. In fact, Payroc is one of the few ACH processors with a routing number, which allows for far more functionality and ACH processing.

Pay By ACH offers the following advantages to ISVs and their merchant clients:

Complete flexibility: Pay By ACH can utilize existing banking relationships or serve as a funding source to originate, clear and settle funds. Not only does this speed up transactions, but it also simplifies integration. In addition, the solution can be white labeled as part of an ISV solution.

Adaptable to economies of scale: As ISVs grow, they may decide to take on more of the financial liability and become a processor as well as a solutions developer. Pay By ACH can transition the responsibility for risks, enrollment and banking while increasing funds and reducing costs.

Simplified integration: Pay By ACH offers RESTful and SOAP API to make integration easy and seamless. Instead of requiring ISVs to jump through a series of procedural hoops, Pay By ACH’s integration is customized to the ISV’s business model. ISVs also have free access to a sandbox login for exploration before signing an agreement.

Truly omnichannel capabilities: Pay By ACH can interface with all payment touchpoints, such as websites, kiosks, pay-by-phone, recurring payments and more. It can also manage payments from stored value cards.

Working with Payroc and including Pay By ACH (Pay By AFT) allows ISVs to keep pace with innovation, merchant client needs, and customer expectations.

To learn more about selling merchant services with Payroc, contact us.