Before you can start collecting ACH payments, you will first need to verify your client's bank account using their bank's routing number, their account name, and account number.
This is to ensure that their bank details are valid hence, avoiding errors during the collection process.
Note: ACH Verification only applies to users based in the United States.
How does the ACH Verification Process work?
Verification can happen in two ways:
Manual verification via a micro deposit transaction process.
The verification process will depend on how the details are entered in Ignition:
If your client signs into their bank online using the select account with internet banking: their account will be instantly verified, and any scheduled payments will be available to be processed immediately.
If your client enters their account name, number, and routing number manually during proposal acceptance: they will enter into the micro-deposit verification process, which they will complete (see below). Scheduled payments cannot be processed until verification is complete.
If you enter your client's account name number and routing number manually, directly inside Ignition (either before or after proposal acceptance): you will enter the micro-deposit verification process and will complete it on behalf of your client. Scheduled payments cannot be processed until verification is complete.
Let's break these down further below:
1. Client signs into their bank online using the select account with internet banking
On the Payment Details section of the acceptance page, select US bank account and enter your online banking details. Ignition has partnered with Stripe Financial Connections, which provides a secure front-end to your online banking system. Once logged in, clients can select the bank account they wish to use for any immediate or future transactions.
Clients will be taken to a widget where they can choose their bank and login. Once they've successfully logged in and chosen their bank account, they'll be redirected to the acceptance page displaying and selecting their bank account as their payment method.
Once they've successfully logged in and chosen their bank account, they'll be redirected back to the acceptance page displaying and selecting their bank account as their payment method.
At this point, their account is now verified.
NOTE: If you have your client's login credentials, you can complete this process on their behalf directly in Ignition (from their proposal>invoices & Payments>manage payment details)
2. Your client enters their account name, number, and routing number manually during proposal acceptance
Alternatively, a bank account can be verified manually via micro-deposits.
Step 1 - Select Enter bank details manually instead (take 1-2 business days)
Step 2 - enter Routing number, Account number and Confirm account number.
Incorrect details being entered is a very common occurrence and reason why micro-deposits may not show up.
Ensure that your client has entered the Routing and Account Number correctly!
When the client's bank account details are entered into the system, our payment provider (Stripe) checks if all the information provided is valid. Stripe automatically does one of the following to verify the customer’s bank account:
Amount: Sends two micro-deposit amounts to the customer’s bank account, with a statement descriptor that reads “ACCTVERIFY”.
Descriptor Code: Sends a single micro-deposit to the customer’s bank account with a unique, 6-digit descriptor code at the beginning of the company name field
An email will be sent directly to your client along with the 2 micro deposits. This email will contain instructions on how to complete the verification process with the link to the form where your client can enter and confirm the 2 micro deposit amounts. The email should arrive along with the deposits 48 hours after the bank account details have been entered into the system..
Once the 2 micro deposit amounts have been confirmed, the bank account is verified and ACH payments can now be collected.
The bank account only needs to be verified once. A re-verification only happens when the bank details are changed.
Note: The reason why it takes about 48 hours to receive the email is because we send it on the same day the micro deposits are reflected on the client's bank statement. This is to give the deposits time to clear on the client's bank account.
3. If you enter your client's account name number and routing number manually, directly inside Ignition (either before or after proposal acceptance):
In this scenario, the process is exactly the same as the manual verification process above, however, if the details are entered by an Ignition user from within the app, the ACH Verification Request is sent to you, specifically, the Company Email Address (See Settings → Company tab) with the Principal User's email as a fallback.
It's important to take note that when checking for the micro deposits, relying on bank feeds is not recommended (or advisable). Bank verification is to be done using their bank statement / online banking data instead. You can always forward the verification email to your client to complete the process, if you don't have access to this data to confirm the deposits yourself.
Click here to know more about Managing Your Client's Payment Details.