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5 min

ACH vs Check: How To Pay Vendors On Time During The Holidays

Pay your vendors on time this holiday season, even when the mail slows down.

Gilad Idisis
Published at | Updated:

Key takeaways

  • Choose ACH over paper checks to send vendor payments faster and more securely.
  • Use same-day ACH when a payment is time-sensitive and needs to arrive quickly.
  • Offer an early-payment discount to encourage vendors to accept electronic payments.
  • Pick fast check delivery when a vendor still requires a paper check.

ACH vs check: key differences for paying vendors

ACH is an electronic bank-to-bank transfer, and a check is a paper document you mail.

How fast is ACH vs a check?

An ACH payment usually arrives in one to three business days. Need it faster? Same-day ACH can move money the same day. A mailed check is slower, and it can take even longer during the holiday mail rush.

Which costs less to send?

ACH usually costs less than a paper check. You skip the price of printing, postage, and mailing each check.

Which is more secure?

ACH is safer because the payment moves electronically. According to the IRS, paper checks are over 16 times more likely to be lost, stolen, altered, or delayed than electronic payments.

Ask your vendors to accept ACH (bank transfers) instead of checks

ACH payments are an easy, fast, and secure way to pay your vendors. Standard ACH transfers take one to three business days, and same-day ACH can move funds within hours when you need to pay on time. The funds are transferred electronically from one bank account to another through the Automated Clearing House network, which includes the Federal Reserve and is managed by the National Automated Clearing House Association (NACHA).

While some vendors still insist on accepting checks, this is a golden opportunity to ask your vendors to transition to this quicker, simpler payment method, at least for the holiday season. It’s in their interest to get paid on time, as much as it is yours, if not more.

Melio offers an ACH service for small businesses that need to pay their B2B bills swiftly and securely. ACH bank transfers are also free on Melio, for you and your vendor.

For every vendor you transition to ACH payments, you’re not only eliminating the risk of late payments, but also saving transactional costs and resources for both of you.

Use expedited check delivery services (like FedEx)

If your vendor is still adamant about getting paid with a paper check, you can (and should) still ensure they get it on time. After all, maintaining a healthy relationship with your vendors is key to running your business, especially during the upcoming hectic time period. Mail carriers (like FedEx) offer expedited delivery options.

If you are already using a bill pay service, it’s also worth your while to check if they have an expedited delivery service for sending checks.

Melio, for example, provides small business owners like you with the option to send their vendors a check by FedEx, with a fast delivery time of three business days. All you have to do is pick the fast delivery option when scheduling your payment.

How to schedule a payment with Melio

Scheduling an expedited check payment with Melio

Ask vendors to pay early for a discount

Another option you should consider is coming to an agreement with your vendors on paying early, in return for an early payment discount. It’s a win-win for you both: your vendor gets paid faster, secures the payment, and improves their cash flow and you get to pay less for the goods or services and avoid the holiday rush.

If you want to take advantage of early payment discounts and hang on to your cash longer, consider using bill pay services that allow you to pay with your credit card (and defer your payment to the next billing cycle) while still delivering the funds to your vendor with ACH or check.

Keep your vendor payments moving this season

The holidays are busy, and slow mail can hold up the payments your vendors count on. ACH helps your money arrive on time, so you can keep those relationships strong.

Ready to pay vendors faster and skip the mail? Sign up for Melio and start sending payments today.

ACH vs check FAQs

Is an ACH payment the same as a check?

No. An ACH payment moves money electronically between bank accounts, while a check is a paper document you mail or hand over.

Is ACH or check better for paying vendors?

ACH is usually the better choice. It tends to arrive faster, cost less, and stay more secure than a paper check.

Is there a downside to ACH payments?

ACH is not instant, so a standard transfer can take a few business days. When you need speed, same-day ACH can help.

Is an eCheck the same as ACH?

Not exactly. An eCheck is a digital version of a check that often uses the ACH network to move the funds.

*This blog post is intended for informational purposes only and is not intended as financial advice.
**Melio does not provide legal, tax or accounting advice, and you should consult with a professional advisor before making any financial decisions.

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