Square partners with Plaid to make ACH payments easier for US merchants
By Pavithra R
Plaid, a FinTech company democratizing financial services through technology, has announced partnering with Square, building simple tools to help people participate and thrive in the economy, to help businesses take advantage of the ACH opportunity by enabling merchants in the US to easily process ACH debits without needing to hold sensitive bank information.
For many e-commerce businesses, ACH payments debited directly from bank accounts provide a lower-cost, more accessible alternative to credit cards. And while cards expire and go missing, account and routing numbers used for ACH payments are more permanent, leaving less room for interruption and error. Despite the benefits for merchants, customer preference and convenience have helped cards solidify their position as the recent default in e-commerce payments.
Now, with this announcement, merchants can accept ACH payments through Square Invoices and developers can enable ACH payments through Square Web Payments SDK, without handling bank authentication or any managed payment complexities.
Under the collaboartion, Square uses a tokenized check system that uses Plaid to allow customers to securely connect their bank accounts for bank payments. This verification option allows customers to quickly enter their bank login credentials to connect an account to enable payments.
“Payment flexibility, security, and transparency are core to Square’s Payment Platform. By offering ACH payments, we can help businesses process large transactions online at a low cost without worrying about bank authentication, compliance, or any managed payment complexities. We’re excited to offer ACH as one of many ways that businesses get paid fast and securely with Square,” said Dennis Jarosch, Head of Payment Platform at Square.
For businesses that collect payments on high-value orders, the power of Square and Plaid means more certain collections. Additionally, Square is also offering fee-free refunds on ACH payments they process to make ACH acceptance even easier.
Founded in 2009, San Francisco based Square is a technology and financial services company that offers software, hardware, and financial tools to empower businesses and individuals to participate in the economy.
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