We recently finished our integration for a new Automated Clearing House (ACH) Feature for batch payments in the Club Prophet software. While ACH has been around for quite a while, the problem is that every bank has a unique format for accepting ACH transactions. There is no standard. The new interface we have allows us to use a standard format, and the gateway will reformat the transaction as needed for your particular bank. This is a great way to collect customer dues and monthly bills. It requires bank routing and account numbers from your membership and replaces the need to have Credit Card on File for this process. You likely use this for utility bills and your Club Prophet service.
There are two huge benefits to doing this:
- If using Credit Card on File with an average effective rate of 2%: $300 x .02 = $6.00/transaction credit card fee.
- With the ACH service, you pay:
- a monthly fee of $39.95
- plus $0.30 per transaction
- plus 20 basis points (.0020) on the total volume
Same as in the example above, assume you have 400 accounts. For comparison purposes, you would spread the monthly payment over the number of accounts and add on the $0.30 fee: $39.95/400 = $0.10 + $.30 = $0.40 per transaction ACH fee. You also need to do a similar calculation for the 20 basis point volume fee: add in the $300 x 400 = $120,000 x .002 = $240 for the 20 basis point volume fee. Spread that over the number of customers to get the average of $240/400 = $0.60 per customer.
- Over the hypothetical 400 accounts at an average bill of $300 ($120,000 gross revenue) for one month: Credit Card fees would be $2,400 vs. ACH fees, which would be $160.60. A savings of over 90%!
- In addition, charge-back fees on credit cards are typically around $25.00/each, and with ACH, there is no charge-back fee.
Plug in the actual numbers for your club, and you will see it’s a "no-brainer" from a cost perspective...but there is some work to do. You need to reach out to your customers/membership and collect Bank Name, Routing, and Account info (a voided check works) in place of (or in addition to) their Credit Card on File data. Get their permission to debit their bank account (we can get you a sample form if needed) for the monthly billing cycle. Flag the customer record to use ACH. Remove (if desired) their Credit Card on File data. You may want to keep Credit Card on File for other purposes, but if you only use it for the customer's monthly billing, then we would suggest you delete it if you move them to ACH processing to reduce PCI-related risk. Also, with ACH, it may take longer to receive the cash deposited in your bank account. We have found that it can take 1-2 business days for a credit card deposit vs. 2-4 business days for an ACH deposit into your bank account.
Once the initial data is entered for each account, a simple “Batch Pay on Account” feature is available from the Club Prophet Sales screen. Here you have a few options:
- Retrieve and auto-ACH each account for its outstanding balance for your billing period*.
- Run a custom batch where you select each account and the amount to be paid via ACH (for example, a one-time assessment or charge for an upcoming event).
- You can also set a flat payment amount for an individual customer account (for example, a customer pays a flat $200 per month, regardless of their account balance).
After a batch is run, the software will also make adjustments for any rejected ACH transactions. You can also use this Batch feature to charge the credit card on file (though obviously, it will cost you more than the card processor). Please note that the Club Prophet Private Club Billing module is required to auto-populate the outstanding balance.
Sign Me Up!
To get started, you need to get an ACH account. We have a simple and secure online registration form on our website to get you started. Just CLICK HERE. You will need your Tax ID (or SSN if sole proprietorship) and your Bank Routing and Account info (the funds are deposited to your bank account via ACH). Filling out this form gets the process started, and Club Prophet will provide FREE TRAINING and FREE SETUP for you.
If there is anything we can help you with, Call us today at 800-793-1872 or email at Sales@clubprophetsystems.com.