It`s true; it can be a problem, both for you, the company, and for your customers. For companies that regularly pay or charge the same customers, recurring payments are a great way to get around the need to authorize and collect bank account details. You need a pre-authorized debit agreement (PAD), an agreement between you and your customer that will allow you to debit accounts without obtaining authorization each time. These agreements are excellent because they remove several steps from the process and help you make sure your payments always arrive on the same day. Have you heard about EEA payments, but you`re still not sure what exactly they are or why they are important? You may be looking for more efficient ways to manage your customers` payments, and you`ve found EFT payments. We`ve gathered all the information you need to understand exactly what EFT payments are and give you the confidence to use them. Below is a complete guide to EFT payments, including: To initiate an EFT payment, you must obtain authorization and information from the debtor`s bank account or debtor from which you wish to send or withdraw the payment. If you are using your bank, you must have asked your customers or lenders to fill out a form detailing the contact and account information they need to send you back. This information allows you to set up EFT payment through your online banking system. With an online payment provider such as Plooto, all you need to do is send an email containing payment details (amount paid and date of receipt) and you can enter your account information directly from the email. Once you and your supplier or customer have provided the necessary information, the payment will be debited from the payer`s account on the agreed date and deposited into the recipient`s account. Depending on the provider, it may take 1 to 5 business days for transactions to be posted to the recipient`s bank account. Every good accountant knows that payment management is essential for the business.
Your customers` money provides the means to pay salaries and keep the light, and payments to your suppliers allow you to acquire the goods you need to produce your products. This concept sounds simple enough, but payment terms, seasonality or medical collection problems can add serious headaches to a seemingly simple process. You need to make sure that your customers send and receive payments at intervals that allow them to have money at their fingertips, otherwise they will not be able to continue their business. That`s why you have to take care of the payments. You should pay attention to payment methods, as some options give you more control over your cash flow, and EFT is one of those types. Some payment methods also offer more control and security, which is another critical consideration for any accountant or business manager. Editor`s Note: This article was originally published on February 5, 2018 and has been completely revised and updated to achieve accuracy and completeness. Eft payments are a generic term that includes ACH payments, transfers and all other types of digital payments. EFT payments are generally faster and offer more security than cheques, wires or credit cards. EFT payments are also more convenient for you and your suppliers or customers.