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What Are Paycards and How Do They Work for Your Business?

paycards

Payroll cards make it a snap to pay employees electronically. Even employees who don’t have bank accounts can receive wages with NatPay paycards.

A sizable number of Americans don’t have adequate access to financial services.

The United States Federal Deposit Insurance Corporation (FDIC) recently found that approximately 94.6 percent of American households, or 124 million households, have banking services. That leaves 5.4 percent, or 7.1 million American households, without banking.

NatPay strives to fill that financial service void by offering a useful method to receive and spend money. Paycards help bring them into the mainstream economy, with benefits for employees, employers, and society at large.

Paycards offer a convenient and safe way to pay employees for their work. Instead of traditional methods like paychecks or direct deposit—which obviously don’t work for employees lacking bank accounts. Paycards are functional for anyone. They are also less costly and faster for many businesses, making them advantageous on both sides of the transaction.

A paycard looks and functions the same as an ordinary debit card. Employees can use them to pay for goods and services or to withdraw cash. Most main card networks, including Visa and MasterCard, support employee paycards.

paycards

Using Paycards Benefits Employees

Payroll paycards allow businesses to send employees their wages instantly. These cards also offer the ease and security of modern technology instead of a check. Paycard security features decrease the risks of loss of funds drastically, and if any issue does arise, the card issuer can cover the losses.

The security issues and inconvenience of checks affect employers as well as employees. Each check costs an employer approximately $3 when one adds together the total expenses. Payroll cards save time and money while making it easier to reach employees, especially those without banks. A business only has to add funds to employees’ cards, rather than mailing or handing out checks. Not to mention saving paper contributes to preserving the environment!

For employees, using a paycard grants them access to their full funds, without fees, yet with the freedom of an account. Employees can withdraw only the cash they need, rather than cashing an entire check, which also makes paycards safer. The paycards function as a debit rather than credit, protecting employee credit ratings, and the cards also include online tools for managing funds.

In the event that an employee loses a paycard, the issuer can replace it with the entire remaining balance there. Also, employees can use their cards whenever and wherever they want.

While many of the advantages of paycards accrue to those ineligible to use or for other reasons not having banks, even high-income people like using these cards. Employees can manage multiple accounts, or share cards with family members if they want. Rather than depend on a regular check, the paycard functions as another bank account.

Many individuals have felt the pressures of not having a secure method to receive their wages. Employee debit cards make payments rapid and safe so that funds are directly available to purchase what one needs. At the same time, businesses have a more positive experience issuing electronic payments. For both employees and employers, paycards can be an attractive choice.

Securely Pay Employees Using Paycards

Using the dominant payment technology in the industry, NatPay offers employee paycards to handle wage transactions automatically. You simply supply your payroll file, and the system handles payments. Employees receive FDIC-insured cards on which they automatically get their wages as soon as they are paid.

NatPay paycards loop those employees without bank accounts into the advantages of direct deposit. For employers, this streamlines payroll and can cut costs. You’ll have accounting data online already to aid in reconciliation. The paycards work smoothly with other direct deposit systems, and you can also use these cards to reimburse expenses.

Employees can use their paycards free at tens of thousands of ATMs, as well as retailers and online. They can also add cash or deposit checks to their cards themselves. Additionally, employees can receive electronic payments from other sources, such as government benefits. Essentially, NatPay paycards give businesses and employees an easy work bank account, including services like bill payment, customer support, and account notices. Employees can even add further accounts for their relatives!

Setting up and using NatPay paycards is extremely simple. You can have the cards sent to your business or directly to employees, and can even keep spare cards available to hand out right away to new employees. Each card includes its own bank routing and account numbers, making these as fully featured as a regular card—you even make direct deposits to the paycards, same as to a bank account.

Furthermore, you can schedule when to make payments. Employees receive automatic notifications and can see the information when they prefer. Additional online statements are also available, like expense reports or invoices.

NatPay: The Payroll Solution For Your Business

Paycards have become a compelling alternative to checks, and it’s easy to understand why. Paycards offer numerous benefits for businesses and their workers. All employees become eligible for automatic payments, even individuals lacking a bank account. Employees don’t have to worry about cashing checks and have the freedom of a financial institution on their side.

Meanwhile, on the back end, your business becomes more efficient, spending less on paperwork and administration. Employers face fewer problems with lost or stolen checks, fraudulent checks, and fees. Thus, transitioning to paycards is a win-win. Power up your payroll and your employees will thank you!

Contact NatPay to get started setting up your new paycard system today! NatPay is ready to assist you in distributing the cards, along with material to tell employees about all the program’s advantages. It’s time to enhance your payment processes!

Who Benefits From a Payroll Processing Partner?

payroll processing

Adopting a payroll processing partner makes payroll quick and painless. And it keeps HR, accountants, employees, and the government happy.

If people are the lifeblood of a company, then payroll is the heart.

From managing salary budgets to paying your employees, payroll departments have the critical responsibility of paying your workforce on time, making sure records are accurate, and ensuring processes are compliant with a raft of federal laws.

Whether your business is small or comprises hundreds of employees, payroll mistakes can be costly. From errors with payroll records to not paying an employee what they are due, any mistake in the link will cost you more than just time spent correcting it. The repercussions of non-compliance with legislation governing your payroll processes can be significant. Submitting incorrect employee details or paying taxes late, for example, could mean penalties.

The effects of a missed or miscalculated paycheck extend beyond the employer; it can often lead to a crisis for the affected employee. And with about 54% of Americans living paycheck to paycheck, a returned check or missed mortgage payment can kickstart a cycle of potentially crippling consequences for some people.

In addition, a missed payment (stemming from a missed or wrongly calculated paycheck) that shows up on someone’s credit report, for example, can directly affect their ability to buy a car, buy a house, or even rent an apartment.

When you consider the significance payday has for many people, it starts to sink in that the payroll experience is one of the most critical touchpoints between an employer and an employee. Outsourcing the work to a cloud-based payroll processing partner like NatPay can help you to avoid costly errors, calculate and submit tax payments on time, and, crucially, maintain employee trust.

payroll processing

Overall Benefits of a Payroll Processing Partner

Payroll and tax regulations can be complex, but with the right partner, you can gain access to expertise in legislation, regulations, privacy, and security in order to mitigate risks. You also have access to IT support, best-in-class hosting infrastructure, and software that you couldn’t afford otherwise.

You can detail exactly the services you want the third-party vendor to provide and be assured that it gets done, without having the time-consuming task of doing it yourself. With companies striving to stay ahead of the pack in an increasingly competitive climate, there’s a greater need for efficiencies, and many companies are beginning to realize the benefits of partnering with an experienced payroll services provider.

Cost Savings

Ironically, outsourcing your payroll processes means fewer workers on your payroll, translating into overhead savings that come with staff keep (hardware and software costs, office supplies, course and training fees). Additionally, outsourcing the work to professionals mitigates the risk of missed payments (and penalties) or not complying with amendments to the latest tax regulations.

Prioritizing Core Business

Allowing a payroll processing partner to take the reins frees up time for you and your employees to focus on other income-generating areas of your business, whether it be customer service, sales, or marketing.

Saving Time

Professionals eat, sleep, and breathe payroll processing. With their in-depth knowledge and experience, they can get the job done right, and in half the time you can.

Expert Access

Complex payroll tax issues in multiple jurisdictions? The experts have the knowledge and expertise to ensure compliance with all the local rules and regulations of your state.

Calculating Payroll Each Time Period

From tracking daily hours and calculating overtime to tax and retirement contribution deductions to the eventual approval and handoff that initiates the payroll process, your payment partner ensures nothing falls through the cracks.

Electronic Paystubs

Employees that require direct deposit need their net pay verified and processed electronically, and also need pay stubs that are securely stored online.

NatPay’s password-protected online paystubs (we introduced the first electronic pay stub in 2000) provide employees secure access to current and past pay information with 24/7 online access.

Easy Compliance for Human Resources

In addition to managing recruitment and selection, performance management, and learning and development functions, it can be extremely difficult for HR teams to stay on top of ever-changing labor, tax, immigration, anti-discrimination, and insurance laws.

Who has opted in for online W-2s? Who has opted out? Are all of the employees' details up to date? Did we get the latest forms and IRS information for the year?

NatPay’s online tax forms solution makes life easier for already stretched HR teams by taking over and eliminating the chance for human error by automating and streamlining the entire tax form process. NatPay's online W-2 solution further lightens the load of HR teams as employees can do a lot more themselves: update personal information, obtain free reprints, and set their own notification options.

Accurate Records for Accounting

When it comes to keeping financial and tax records, it is crucial that the accounting team accurately records these for future use. For bigger companies, this may involve generating reports for hiring and staffing projections. A payroll processing partner can help you take the load off your accounting team by keeping financial records organized and easily accessible in their payroll system.

Tax form calculations can be tedious at best and consume endless hours from your accounts team. A payroll processing partner has the skills and tools to quickly perform multiple calculations accurately to prepare and submit remittances to federal agencies.

A single payroll mistake can erode the trust employees have in their employer. In fact, just two payroll errors can have many people looking for a new job. And when negative pay issues show up on Glassdoor, the impact on your brand can be devastating. Partnering with a credible payroll processing entity eliminates this risk.

payroll processing

Ultimate Convenience for the Employees

Ultimately, you want to keep your employees happy and keep staff turnover rates low so it’s essential to leave no room for error.

Using the employee self-service features that come with NatPay’s intelligent software, you can get them to help you input data needed for payroll calculations and keep them satisfied with the knowledge that they have a say in their pay, so to speak. The self-service feature also allows them to receive their paystubs in a confidential and more secure manner—our unique and proprietary 3-tier server systems guarantee that all data is safe.

Employees love NatPay’s Direct Deposit Plus because it incorporates a simple, web-based interface with powerful features that no other direct deposit provider can match. So employees get paid on time every pay cycle.

NatPay also offers free marketing support to help you increase employee participation in the program.

Seamless Payroll Processing with NatPay

Migrating from traditional time tracking and payroll methods you’re used to may seem like a massive leap for your employees, but when all it takes is one or two mistakes to inflict serious reputational damage to your business, it’s clearly worth the effort to be in the secure hands of the experts who will make managing your payroll a breeze.

NatPay is the leading company to offer third-party processing of Direct Deposit for employee payroll, processing more than $115+ billion annually for 228,000+ ACH clients nationwide. Upload payroll files from any computer with internet access, and you'll be on your way with a better way to pay.

NatPay offers a comprehensive portfolio of payroll, HR, and financial solutions with services that help you focus on what matters—running your business.

Get in touch with our experts today to learn more about how all types of payments are processed accurately through NatPay’s secure, online systems and enjoy multiple timing options and full NACHA compliance.

Employee Payment Methods For Your Business

Employee Payment Methods

Businesses can choose among numerous employee payment methods. But for security, speed, convenience, and costuse NatPay’s direct deposit and paycards.

When it’s payment time for your employees, payroll services can assist your organization with payroll processing, as well as a number of related activities. For example, payroll services can calculate and even send in taxes and generate reports.

Using a payroll service can save you valuable time. It makes sense to focus on what you do well, leaving these administrative tasks to a payroll processing firm. This also saves you substantial money, given that a payroll service can cost substantially less than hiring an individual.

Payroll services also increase the accuracy of your payments and tax compliance. In some cases, a payroll provider will even cover any tax penalties that result from errors, taking you off the hook.

In comparison to dealing with payroll in-house or hiring an accountant or bookkeeper, using a payroll processing service makes the entire process a snap. For this reason, online offerings have become increasingly popular. In addition to handling the financial details, they supply you with convenient web and phone apps to manage your data.

For a modest sliding scale fee that adjusts to the number of employees you have, service providers give you feature-rich, easy-to-use payroll solutions that work with your existing processes. Using a service simplifies your payroll.

There are many types of payment methods out there, but they differ considerably when it comes to effectiveness. Choosing the right payment method can mean the difference between employee satisfaction and financial disaster.

Employee Payment Methods

Employee Payment Methods: Which One is Right for Your Business?

As an employer, you can select among not just one or two, but over five types of payment methods for your employees. These range from traditional cash payments and checks, to e-payments like PayPal or bank transfers, to paycards and direct deposits. While all are viable methods, the latter two choices are the most technologically efficient, offering increased security and convenience.

Cash and Check Payments

While obviously the oldest method, direct cash payments have in many cases given way to paper checks and electronic methods that can handle larger sums.

Checks offer some degree of security over cash. But they are slow to deliver and subject to loss and crime. Also, employees who don’t have bank accounts may have to pay fees to cash their checks.

Direct Deposit Payments

Direct deposits speed up the process, putting funds in employees’ accounts far faster than a check can.

After initially establishing a direct deposit with a bank, wages get transferred as soon as they are sent, often without any fee to receive. Also, transactions produce accurate records automatically. Direct deposit has become by far the most common payment method in the United States. Online payroll services can incorporate direct deposit into their offerings for you, simplifying this process even further.

Paycards

Paycards work somewhat like direct deposits behind the scenes.

However, paycards do not even require employees to have a bank account! This method has recently become much more widespread, as it offers the security and convenience of a bank card for anyone. Employees receive an FDIC-insured prepaid debit card, onto which they can instantly deposit funds. The workers can spend the money wherever they like, or withdraw cash from a bank or ATM. It essentially functions as a work-payment bank account for employees.

Mobile Wallets

Mobile wallets, which work somewhat like direct deposits on phones, have also become a more widespread payment method. One sends money to employees’ mobile wallets, from which they can make purchases. However, employees may not be able to spend the funds at as many locations as with a bank account or paycard.

The available employee payment methods vary in terms of convenience, costs, and security—for you and for workers. Generally, each new development represents an enhancement over previous methods. Cash led to checks, then direct deposits and paycards.

These more recent innovations reduce the errors, costs, and time to transfer money. As society and the economy become increasingly digital, employees have come to expect electronic solutions in practically all areas of their lives. This includes wages, where workers want simplicity and efficiency.

Securely Pay Your Employees Through NatPay's Direct Deposit and Paycards

When looking to move to ahead-of-the-curve methods of employee payment, turn to NatPay. NatPay offers a range of digital solutions for payroll efficiency.

Direct Deposit

Direct deposit features let you process wages when you want over an adaptable web interface, and alert employees accordingly. NatPay works well with accounting software and doesn’t require you to install any additional hardware or software.

Paycards

By using the industry’s go-to solution for payroll processing, you have access to a cryptographically secure system that thousands of businesses trust. And for employees without bank accounts—or just for added convenience—you can also issue paycards. These give your employees the power of a bank card, onto which you can deposit their paychecks as easily as to any bank account.

Workers can use their paycards at millions of websites, retail stores, ATMs, banks, and other locations. They receive the money as soon as you send it, and they can spend it whenever they want. Employees can also accept other transfers on their cards, such as from their tax returns.

Consider NatPay for all your payroll processing needs. NatPay cards allow holders to deposit checks and pay bills, among other features. Employees can also share add-on accounts with friends and relatives. Meanwhile, from a business standpoint, you get to save hundreds or thousands of dollars, as well as a decrease in paperwork.

NatPay partners with software firms and accountants to make incorporating automatic payroll processing into your organization a straightforward process. With a focus on the customer, they offer the latest technologies with exceptional service. By using NatPay, your employees will appreciate fast, safe, and easy paycards and direct deposit services, while you cut costs.

If you’re ready to streamline your payroll process, reach out today!

How to Manage the Nexus of HR and Finance for End-to-End Payroll Execution

payroll execution

Incorporate a payment processing and payroll execution partner to help streamline business functions with HR and finance teams.

Executing payroll properly is a crucial part of any business. As the primary mechanism by which employees receive their wages and salaries, a rigorously executed payroll process can help keep your business free from labor disputes or statutory compliance issues.

The payroll process, which combines the responsibilities of both Human Resources (HR) and finance, consists of the steps needed to pay employees each period and involves tracking hours worked, deducting money for employee benefits, and remitting payroll taxes.

A successful payroll process depends on understanding the process and finding the most efficient and secure way to run it.

Some of the major benefits of using an automated software solution for the payroll process include reduced risk of costly compliance issues, greater employee satisfaction, automatic updates for any tax code or deduction changes, as well as time and money savings.

In this article, you will learn how investing in an automated payroll system can streamline the payroll process for HR and finance teams, making sure there aren’t any missing steps in the process.

payroll execution

Human Resources: Pre-Payroll Processes

Payroll execution is part of operating your business legally, according to state and federal laws. From tracking employee time to recordkeeping, the Fair Labor Standards Act (FLSA) has several directives that fit into your payroll execution and these regulations should be kept in mind when setting up your payroll procedure.

Choosing a payroll processing system

Start by deciding on a payroll processing system that suits your unique business needs. Options include processing payroll manually (best for a small business with few employees), choosing payroll software, or outsourcing the work to a payroll processing partner. The more complex your payroll calculations are, the more likely you will need payroll software or outsource it completely.

Payroll policy creation

Determine how your payroll policy will work. This includes basics such as methods of payments and payment dates, as well as attendance and leaves policy. Payroll deductions, withholdings, and the benefits you offer will impact the employee’s paycheck. Include tax payment dates in this policy.

Collect necessary employee information

Gather input from various departments to ensure accurate calculation of payroll. W-9 or I-9s forms will give you each employee’s personal information, social security number, and tax filing status. If additional deductions are added to your payrolls, such as health insurance or retirement savings, you will need documentation to show the employee has approved them. If you plan to offer direct deposit, get employee consent and banking information.

Direct deposit payments

Set up direct deposit payments for payroll via your bank or payroll service provider. Direct deposit payments do more than simplify the payroll process. They reduce costs, minimize risks of fraud, and ensure employees are paid on time. Bookkeeping becomes much easier as lost or stolen checks are a thing of the past and there’s no waiting time for checks to clear. Employees appreciate knowing they can depend on their salaries appearing in their accounts on time.

Time track employees

Establish a system for tracking employee hours. Such a system allows for better record keeping and accurate payrolls. The FLSA mandates accurate record-keeping for all employers, including overtime, hours worked, and youth employment standards. By law, these records must be kept for at least three years. Time cards and other records on which payroll calculations are based need to be kept for two years.

Employee timesheet collection

Paper timesheets require substantial effort on the part of HR personnel as the information needs to be inputted manually and then re-checked to make sure there are no errors. Then it’s a matter of entering those numbers into the payroll records. Digital timesheets eliminate all that. It’s simply a matter of importing them to payroll software, securing approval, and then running payroll.

Human Resources: Payroll Processes

Establishing local tax IDs and employer identification numbers (EIN) is the first step in processing payroll. The government uses these identifications to track your business's payroll taxes and ensure you are meeting requirements.

Before processing payroll, HR will get your employees to fill out various tax forms, W-4 and I-9 (if it is a new employee) so they can account for allowances and other tax details.

HR should also have these documents on hand:

  • Job application: Having this document on file ensures that all key payroll information is in one place.
  • Deductions: The employee may participate in company benefits, such as health insurance, a health savings account, or a retirement savings plan. Proper payroll processing ensures that the correct amounts for these benefits are withheld each pay cycle.
  • Wage garnishments: You may be required by law to garnish your employees' wages if they owe money, such as IRS payments or child support. Wage garnishments are court-ordered; ensure you have the proper documentation in your records.

Choose a schedule that works best for your business, either monthly, biweekly, or weekly. You'll also want to establish the preferred delivery method for each employee. Once you've set up a payroll schedule, you can begin processing your first payroll. To do this, you must calculate each employee's gross pay–the total number of hours an employee works in a given pay period multiplied by their hourly rate.

  • Worker A has worked 50 hours for your weekly pay period.
  • They earn $10 per hour.
  • 40 hours x $10/hour = $400
  • Gross pay = $400

The payroll process includes various statutory deductions, and payroll administrators must ensure that all statutory compliances are strictly followed during payroll execution. Gather information from your workers' tax, insurance, and benefit requirements to determine each employee's deduction. Tax rates vary by state and city, so administrators must be well-versed in state and local requirements. Subtract each employee's deduction from their gross pay. The amount left over is the employee's net pay or take-home pay.

Once HR has verified the data, it's time to feed it into the payroll system. Re-checking the information again in this step will eliminate errors. The payment process can only proceed when HR is satisfied that all the calculations are correct.

Finance: Post Payroll Processes

Every organization needs to maintain an accurate book of accounts. Feeding all salary data into the accounting or ERP system is, therefore, an important step in the post-payroll process.

Post-payroll, HR will also be required to prepare reports containing information such as department or location-wise employee costs. These reports are then sent to the finance department or the management team for further analysis.

Keep records of your payroll transactions for tax and compliance purposes. When someone disputes a paycheck or the IRS needs some sort of documentation, you must have your records ready.

Efficient Payroll Processing With NatPay

Processing payroll in a company involves a lot more than just calculating salaries. The process can be complex and daunting, which is why it makes good business sense to partner with an entity that completely understands the payroll process; and that offers end-to-end payroll solutions that can ease the burden of your company’s payroll processing function.

NatPay’s Direct Deposit Plus (DDP) service incorporates the latest advances in online technology so you can upload payroll files from any computer, anywhere. Simply upload your payroll files to your payroll account and you're ready to go. The feature is a simple, web-based interface with powerful features unmatched by other direct deposit providers.

With DDP, there’s no need for new software, you get multiple timing options, it’s flexible to facilitate, and has emergency processing. Employees also receive free payment alerts when their money is en route. They get 24/7 access to their online pay stubs to securely view their pay information from any device at any time.

Contact us for a demonstration and learn how NatPay can help your organization save time and money by streamlining your payroll execution process.

5 Benefits of Using Two-Factor Authentication (2FA)

two-factor authentication

Protect your business and your customers from online fraud with two-factor authentication. Learn the benefits of using 2FA for fraud prevention here.

With 2FA, you can offer your clients and employees secure and convenient payment and data processing, thanks to multi-layered data encryption and file protection.

With cyber fraud on the rise, app developers and service providers have launched two-factor authentication to bolster online security, as 2FA can prevent nearly all unauthorized account login attempts. Also referred to as two-step authentication or multi-factor authentication, this security measure can prevent the large majority of unauthorized login attempts.

According to the FBI's Internet Crime Complaint Center, internet crime resulted in a staggering $6.9 billion in losses in 2021 alone. The most common internet crimes are phishing or pharming schemes which racked up over a third of that damage, totaling nearly $2.4 billion.

In this article, you will discover how 2FA offers a range of benefits for businesses and their clients.

What is Two-Factor Authentication?

Passwords are no longer very effective in securing digital information. At first glance, passwords seem relatively secure. But in practice, they do very little. Considering how 100 million accounts use ‘123456’ or ‘password’ as their login, hacking account information is a breeze for cybercriminals.

In contrast, two-factor authentication adds an additional security layer to prevent cybercriminals from accessing sensitive information, even if they do obtain a password. In addition to a username and password, 2FA also requires the user to enter a private one-time access code. This code serves as a second security identification measure before granting access. This security feature is essential for modern businesses to monitor and safeguard their data.

Understanding How Two-Factor Authentication Works & How To Use It Effectively

Many businesses and individuals understand the value of two-factor authentication when it comes to high-value information like financial accounts. But the truth is that you should be using 2FA whenever it’s an option. Criminals are looking to access personal and business data as much as finances. And as a business, you are responsible for keeping all of your client's information safe. You need to offer customers a safe way to use your services without putting their (or your) sensitive data at risk.

Using the same form of authentication (such as a password and your first pet's name) for both verification steps does not constitute two-factor authentication. Both of these methods are known as knowledge factors, classifying this as single-factor authentication. For multi-factor authentication to be effective, access credentials need to include factors from two different categories. You might use a possession, biometric, location, or time factor, for example.

The possession factor is the most popular second-step method in use for most 2FA applications. This involves something only the user has access to—an ID card, mobile device, smartphone app, or security token. Meanwhile, a biometric or inherence factor involves physical characteristics such as a fingerprint, facial or voice recognition, or speech patterns.

The majority of 2FA systems rely on knowledge, possession, and biometric factors; however, you could also use a location factor, which limits authentication to specific devices in certain locations, or a time factor, which only permits access for a restricted period of time.

Enabling two-factor authentication will vary according to vendor applications; however, the overall authentication process is similar across the board. After the user enters their login with a username and password, the server matches the user to their profile. The user is then prompted to verify their identity with the second log-in step. The system will, for example, generate a code and send it to the user’s mobile device. After entering this one-time code successfully, the user can access the account.

How Can Two-Factor Authentication Help Your Business?

Many people still believe 2FA is just an extra hassle, rather than just using the same password across accounts. This couldn’t be further from the truth. Two-factor authentication bolsters security, but also can make sign-on simpler. In an age of increasing cybercrime, using it should not be negotiable.

1. Prevent Fraud and Identity Theft

Identity theft can take place in a variety of ways. A hacker might tap into a user's personal account, for example, or gain access to a whole business database. Medical, eCommerce, government, and financial institutions are all popular targets since there are repositories of all types of personal information.

For example, since health care portals send electronic records and contain a host of provider and patient information, health providers have become a major target for hackers. Passwords alone are no longer sufficient barriers to keep cybercriminals from gaining access to this critical data.

The growth of eCommerce also presents many new fraudulent opportunities for hackers. Account takeover has become the biggest fraud threat for online vendors; eCommerce websites are frequent targets for large-scale attacks since hackers do not need to be physically present to execute online fraud. Sales fraud and fake charges are costly for companies since they need to issue scam refunds to customers.

By implementing two-factor authentication, businesses can establish a reputation as trustworthy and secure partners—while also improving their bottom line.

2. Streamline the Login Process

To keep account access convenient while remaining secure, businesses can generate one-time passwords (OTPs) to serve as a secondary authentication measure.

An OTP is a random sequence of letters and/or numbers received via SMS, email, voice message, or push notification. Since an algorithm creates each time-sensitive code randomly, they are extremely difficult for hackers to guess. In addition, the code is only valid for a short period of time, further limiting the hacker's window of opportunity.

OTPs also reduce password fatigue. Not having to continually create and remember new passwords reduces frustration and wasted time trying to remember and reset passwords. Additionally, this reduces the time IT help desk staff have to spend resetting lost or stolen passwords. Two-factor authentication and OTPs make user verification simple, fast, and easy, without compromising security.

3. Two-Factor Authentication Increases Customer Trust

With internet fraud so abundant, data security is at the forefront of consumers' minds—especially when they share personal and payment information online. Whether it’s medical and educational platforms or making purchases, customers want to know that they can trust a business with their information.

Even though additional verification steps can seem like a hassle, two-factor authentication improves customer experiences and solidifies your business’s reputation as a trustworthy partner. Safeguarding employee information—especially in healthcare, education, finance, and government—is essential; customers who do not feel that their information is safe will not hesitate to seek solutions elsewhere. The increased security also gives businesses confidence in the services offered to clients.

4. 2FA is a Step Toward a Passwordless Process

Passwordless verification replaces passwords with more secure authentication measures. As already discussed, biometrics and possession factors are largely used as verification measures; however, magic links offer another method. With a magic link, the user enters their email address in the login platform. The system then sends the user an email containing a time-sensitive verification link, which then gives the user access.

Most users default to using the same passwords or choosing an easy-to-remember (and therefore easy-to-steal) password to simplify matters. But this is detrimental to data security, letting hackers into multiple accounts by cracking a single password.

Two-factor authentication is, therefore, an essential best-practice measure for emails, financial, social media, and eCommerce accounts. Going passwordless eliminates the need to remember or generate passwords, and ensures that cybercriminals cannot hack accounts based on simple password theft.

5. Reduce Operational Costs with 2FA

Online fraud can cost your business a lot of money. Whether it’s a breach of customer data, account takeovers, false charges, or account theft, businesses are often the ones who have to compensate customers for their losses.

In addition, tracking and notifying customers of suspicious activity is costly in terms of time and money. Implementing payment security features reduces fraud—and thus all the costs associated with such crises. This also reduces the time help desk staff spend tracking and reporting fraudulent cases, so they can focus on more complex customer concerns.

While setting up two-factor authentication does require an initial investment, it can save you and your customers in the long run—not only financially, but also in terms of your reputation.

two-factor authentication
Image: Shutterstock

Partner With NatPay to Increase Business Security for Your Customers

Considering how rampant online fraud and identity theft are these days, it’s almost unthinkable that anyone would willingly make themselves or their clients vulnerable by not implementing top-notch data security measures. And yet too many companies and individuals continue to operate with paltry password systems that leave information ripe for stealing. It’s time to upgrade your sign-on security!

NatPay has operated as a leader in secure payment processing for over 30 years. From tax payments and expense reimbursements to invoicing and secure document delivery, NatPay’s secure online systems incorporate the latest technology to simplify and safeguard all your financial transactions. Direct Deposit Plus lets you upload payroll files from any computer, with emergency processing features, text alerts, and multiple timing options. You can offer your clients and employees secure and convenient payment and data processing, thanks to multi-layered data encryption and file protection.

Contact NatPay to start protecting your business from online fraud today.

The True Costs of Payment Fraud & How to Minimize Your Risk with the Right Partner

payment fraud

Fraud impacts your business' reputation and impedes operational integrity. Minimize payment fraud risk with the right payment processing partner.

The rapid rise of eCommerce platforms and the accompanying $861 billion spending splurge in tandem with the government’s huge COVID-triggered relief packages have spurred a significant surge in payment fraud. And while losses are a major consequence, they're only part of the overall impact that fraudulent activities have on businesses.

Even before the pandemic struck early in 2020, losses from general purpose and private label credit, debit, and prepaid card fraud were already on the rise.

Gross fraud losses amounted to $28.65 billion in 2019, up 2.9% from $27.85 billion in 2018. This doesn’t even include the billions of dollars in fraud losses related to QR code-based and push payments.

All stakeholders—customers, vendors, financial institutions, and everyone in between—are impacted in a range of ways, and the impacts associated with payment fraud extend beyond just monetary value and include reputational, operational, and regulatory costs.

With ever-lurking fraudsters becoming increasingly sophisticated and research indicating that online sellers lost $130 billion to online payment fraud between 2018 and 2023, it’s crucial for all who form part of the payment ecosystem to adopt more rigorous fraud prevention measures and remain vigilant.

payment fraud

Businesses Suffer From the Costs of Payment Fraud

Fraud, naturally, drains money from businesses and merchants are among the hardest hit. On average, merchants spend between 3-5% of their revenues fighting fraud. Still, as much as 1% of orders are missed, often resulting in chargebacks that range from $15-115. The total amount of money lost by merchants due to chargebacks is anticipated to exceed $40 billion before 2025.

Chargebacks are important protections that increase public confidence in credit and debit card payments, but they present a double whammy for online retailers: After making a fraudulent purchase and then fraudulently filing a chargeback complaint, it adds insult to injury when that company must also cough up extra fees and fines as a result.

Additionally, if companies happen to exceed a defined chargeback threshold, they could be entered into an Excessive Chargeback Program which costs them additional fees until they get their chargeback rate under control. Worse, they can be flagged as being "high-risk." Chargebacks, however, are only the proverbial tip of the iceberg as merchants also pay big time in other ways, including reputational damage and higher operational costs.

Payment Fraud Increased During the Pandemic

Studies have found increased fraudulent activity across nearly every business category during the pandemic. The Association of Certified Fraud Examiners (ACFE) found that 77% of respondents have reported an uptick in fraud since the outbreak and expect it to continue.

While COVID-19 hasn't introduced the problem—fraud and economic crime were already at record highs pre-pandemic—it created an environment in which criminality flourished. Three conditions unique to the pandemic contributed to a distinct rise in business fraud.

Ecommerce Boom

Pandemic-driven regulations such as social distancing and quarantines have prompted consumers to spend heavily online as both customers and businesses looked to avoid physical contact.

As a result, eCommerce spending in 2020 reached $840 billion in annual sales. And in the gush of online transactions, scammers upped their nefarious game considerably, with 68% percent of anti-fraud professionals noticing an increase in payment fraud last year.

Cybercriminals used stolen or fraudulent information and unauthorized credit cards, gift cards, and digital wallets to go on their bogus shopping sprees, leaving businesses to pick up the tab.

Federal Financial Assistance

The government passed multiple billion-dollar relief measures to help offset the economic difficulties triggered by the pandemic. A significant portion of businesses (62%) and more than 5 million individuals benefitted through this program. The sheer scale of the stimulus package combined with relatively minimal oversight of applicants created fertile ground for a fraud frenzy.

Increased Security Risks From Remote Work

While technology makes it easier for remote employees to do their jobs and stay connected, it has increased security challenges. In the dash to enable employees to work from home, many businesses relaxed security protocols and rushed the adoption of systems that would’ve otherwise been rigorously evaluated. This left business networks wide open to fraudsters. As customers, businesses, and employees scrambled to adjust to new technologies, hackers were presented with a virtual gift, and cyber fraud escalated.

Reputation and Operational Impact on Businesses

Companies spend years painstakingly building a brand, only to lose it overnight because of a security breach. Fraud-induced reputational damage will ultimately result in losses that are far greater than just the direct financial cost of a particular fraudulent activity, and it can be difficult to measure.

Of course, the most obvious way in which fraud affects a business is financial loss, but it usually goes well beyond that. A company embroiled in fraud is usually a red flag for investors, partners, customers, and employees. Who wants to deal with entities that cannot be fully trusted?

There’s also the possibility that you can be flagged as a high-risk vendor by card networks. This will result in higher card processing fees, and in some cases, may lead to your business being blacklisted by a card network.

Fighting fraud is a time-consuming and expensive process. Employees invest long hours in investigations, settling representations, and fraud audits. All of these incur high labor costs. In addition, money spent on shipping fraudulent transactions is gone, forever, with large orders (usually heavier and more expensive to ship) more likely to be fraudulent than lighter ones. Fraud also usually triggers a rethink of the business strategy with added costs in terms of money and time.

NatPay: Your End-To-End Payment Solution

As the online payment ecosystem continues to grow, so too will the opportunities for fraudsters who continue to adjust their social engineering techniques to breach business payment systems.

The true cost of payment fraud is not just determined in lost dollars. Payment fraud can affect your company's reputation, its ability to operate smoothly, and even regulatory compliance. Businesses that don't manage their risks effectively may experience eroded customer confidence or complicated relations with partners.

All these side effects will have negative impacts on the growth and overall success of your business. NatPay offers secure payment solutions designed specifically for your business ensuring that the fraud protection call from National Payment’s team of trusted analysts and payment professionals is the call you want to get.

Have questions? We're here to help you eliminate risk while still providing flexibility in how you execute a payment. Contact NatPay today.

How to Ensure Fraud Protection for ACH Payments

ach payments

While there are many benefits to automated and safe ACH payments, there remains the very real possibility that companies can fall victim to ACH fraud.

The Automated Clearing House (ACH) network has made transferring funds between banks, financial institutions, and their customers quick and easy. While there are many benefits to these largely automated and safe ACH payments, there remains the very real possibility that companies can fall victim to ACH fraud.

While fraudsters have a variety of tools in their arsenal, a criminal can commit ACH fraud by claiming access to just two pieces of information: your business checking account number and your bank routing number. Armed with that information, con artists can use those digits to fraudulently pay for goods or services, either by phone or online. The most common ACH fraud attempts are misrepresenting a business and the unauthorized use of business bank accounts.

This new development indicates that fraudsters are now targeting ACH transactions for their scams as they move away from cheque and wire fraud, a report by AFP states, adding that as ACH transactions are typically considered safer and more difficult to breach, the uptick in ACH fraud suggests that thieves are becoming more sophisticated.

Fraud is no doubt a major threat to any business, and by the time you realize the crime, the criminals have long disappeared–leaving you to sweep up the financial mess.

In this article, you will learn what financial professionals can do to guard against the risks of ACH payments fraud and what to look out for.

The Risks of ACH Payments Fraud

According to a report by AFP, there was a noticeable increase in fraud activity via both ACH credits and ACH debits.

Over 80% of organizations surveyed were targets of payment fraud in 2018, including ACH, check, and debit or credit card transactions. This number represented the second-highest percentage since 2009. Large organizations were particularly prone to payment fraud, registering a jump from 2018 of 7 percentage points year-on-year to 87%.

Financial professionals (33%) reported their organizations’ payments via ACH debits were compromised in 2018; increasing to 33% from 28% in 2017. Fraudulent activity via ACH credits also climbed 7% from 13% in 2017 to 20% in 2018.

It is possible, the report adds, that in order to conduct scams via ACH transactions, fraudsters may either compromise internal systems through phishing attacks or recruit assistance from inside their target organizations to help initiate fraudulent ACH transactions.

How Does Fraud Happen With ACH Payments?

An important first step in stamping out ACH fraud is to know how it happens.

As AFP President and CEO Jim Kaitz notes: “Treasury and finance professionals need to learn the latest scams and educate themselves—and perhaps more importantly—their work colleagues on how to prevent them.”

Common Scams Affecting Businesses

Payroll Exploits

One of the oldest ACH scams around is to fool HR administrators into transmitting payroll funds to the bank accounts of fraudsters.

In this scenario, the thief steals the login credentials of a company executive. Claiming to be the employee, they then send an email to HR asking to change the direct deposit bank account details. If HR falls for the ploy, the paycheck gets deposited into the account of the scammer rather than that of the legitimate employee.

Phishing Emails

In this type of scam, a phishing email is sent to an individual, typically in the accounting office, who is authorized to perform ACH transactions. The individual is redirected to a website infected with malware by opening the email. The malicious site then installs a trojan, a type of virus designed to steal sensitive data such as banking credentials.

Once the trojan obtains this data, ACH transfers are initiated, frequently to multiple human mules. Recruited via work-at-home ads, the mules receive the ACH payments and then transmit them to fraudsters, keeping a portion of the funds for themselves.

In one well-known sinister scheme of this kind, the phishing emails were purported to have been sent by the IRS and carried the subject line: "Notice of Underreported Income."

ACH Payments Check Kiting

Another type of exploit is inspired by the check-kiting scams which used to take place when paper checks were a major way of moving money.

ACH check-kiting attacks exploit the traditional lag time for ACH processing. The fraudster juggles funds to and from accounts at different banks. In this scheme, the ACH ‘checks and verifies’ the said funds but it disappears by the time the transfer completes.

In September 2016, ACH introduced one-day processing.

NACHA, the ACH’s governing body, also recently added two hours to one-day processing times with the introduction of the so-called third window. However, less lag time also means that companies have less time to investigate suspected ACH fraud before transactions are cleared.

ach payments fraud protection

Tips for ACH Payments Fraud Prevention

The good news is that you can enjoy the benefits of ACH transactions while guarding your company against fraud. Putting a system of checks and balances in place makes sense for any financial function.

Another effective countermeasure to prevent fraud is to limit the number of individuals who are in a position to commit fraud. Using iron-clad passwords, changing them often, and limiting the use of your ACH system to those individuals who need to use the system will also help to strengthen your system.

Important Security Measures for Institutions

ACH Blocks

The simplest and probably the best way to prevent ACH fraud is to place a block on all your accounts. This measure will not automatically reject transactions; but, in each case, you will be required to review and approve the transaction before it can be processed.

Encrypt Your Network

Whether your network is on-premise, cloud-enabled, or a hybrid configuration, make sure that all personal information is encrypted using HTTPS. Additionally, you should ensure that the computers that store or access financial information are free from viruses and malware.

Role-Based Access to ACH Payments

In an SMBC-level execs might be the ones to manage ACH transactions. In a larger enterprise setting, we’re probably talking about accounting and finance. There’s really no reason why people in your sales, marketing, or manufacturing divisions should also have access to your ACH processes, except as payroll recipients.

Multi-Factor Authentication (MFA) for Client Logins

Make doubly sure that employees, customers, and vendors are who they say they are. Along with a password, institute mandatory authentication requirements through fingerprint ID.

State-of-the-Art Intrusion Prevention Technology 

Implementing these tech tools will help protect against ransomware, phishing attacks, and other malware exploits.

ACH Filters 

These filters will block a fraudulent transaction, automatically returning all ACH transactions to a designated account, with the exception of those that are pre-authorized.

ACH Alerts for Each Customer

These will enable the customer to monitor and stop any unauthorized ACH debit.

Comply with Regulatory Requirements

These include Know Your Customer (KYC) regulations for the banking industry and HIPAA for health care information privacy, for example. Abiding by the NACHA operating rules will also help to reinforce your defense against attacks.

NatPay = Solutions. Service. Stability. Security.

Fraudsters are getting creative in impersonating clients and creating fictitious financial documents to siphon funds from your company. If you looking for the security measures you need for ACH fraud prevention, you have three choices: You can hire an institution to run your ACH processing service. Alternatively, you can take a DIY approach, purchasing software and services such as ACH block and intrusion prevention software.

Your third choice, teaming up with NatPay, will prove to be the most rigorous, affordable, and effective.

With over 30 years of experience, NatPay offers you services that include processing all types of ACH payments ranging from direct deposits to tax payments to expense reimbursements, processing more than $115 billion annually for 228,000+ ACH clients nationwide. NatPay’s services support an unlimited number of users, providing them with role-based system access for protecting confidential data. NatPay’s network adheres to industry-standard solutions for security such as 24/7 system monitoring and 128-bit encryption.

Contact NatPay today to schedule a FREE online demonstration that is customized for your organization. If you like what you see, NatPay will prepare a FREE pricing proposal tailored to your specific needs.

The Ultimate Guide to Business Payment Processing & Mitigating Financial Risk

payment processing

Businesses conduct more document and payment processing than ever before. Learn how to ensure your assets and employees are secure and protected.

In an increasingly online and instantaneous world, businesses must digitize their processes to stay ahead of the curve. Considering the critical importance of paying employees, perhaps no process is as ripe for digitization as payroll.

Establishing electronic payment processing for your employees simplifies both your life and theirs, as it allows for faster and more secure payments than physical checks. As such, direct deposit and paycards are quickly replacing traditional methods of payment and can contribute to your company’s financial success.

With a payment processor, you gain the freedom to manage payroll whenever you want. Instead of having to send information to third parties at specific times or hire expensive full-time payroll employees, you can input the information on your own schedule. Just input the wage data at your convenience, and then the system takes care of the rest.

Payment processing systems also give you more accurate results than manual payroll and increase your regulatory compliance. Rather than struggling to keep abreast of all the latest legislation, processing systems incorporate the latest tax code changes automatically.

Conducting your payment processing with a reliable payment processing partner gives your company added protection against increasing cyber threats in society. Small business payment processing can remove substantial headaches for busy small business owners, while medium and large businesses can save considerable funds.

In this article, you’ll learn how partnering with a digital payment processing company is a smart move for businesses of all sizes.

payment processing for payroll

Payment Processing Partner Benefits

The best payment processors include a range of utilities. For example, a top-notch payroll system should include detailed reporting and an easy web admin interface.

Some payroll systems also include features to manage paid leave and workers’ compensation and offer multiple payment choices. The ability to pay some employees by direct deposits and other employees by paycards, for example, can make a payment processing provider far more appealing than more limited alternatives.

Allowing employees to see and download their own data also makes a payroll system more useful. For instance, employees should generally have access to their pay stubs and tax records, preferably with records extending back several years. This decreases the time spent personally assisting employees while giving them more control.

Some payment processing companies can assist you in integrating their tools with your other products. This may involve the use of an application programming interface (API), or perhaps they may already have available connections. This integration makes life much easier, as one can then directly use data from one program in another, instead of laboriously synchronizing them.

NatPay focuses on both services and integration, offering enhanced direct deposit services through a secure system, to ensure risk mitigation. The straightforward web interface lets you send out payments directly to employees’ bank accounts. And in addition the direct deposit function itself, NatPay also includes online pay stubs, employee notifications by email and SMS, and marketing assistance for your organization.

Easier Employee Payments With Direct Deposit

Payroll systems that let you pay wages through direct deposit substantially simplify check delivery come payday. As the term implies, payment is instantaneously transferred, thus mitigating processing times and reducing the need for physical checks. It is also more secure—payroll fraud is far easier with paper than with direct deposit.

With cyberattacks on the rise, we need ever-stricter security measures. NatPay Direct Deposit fully encrypts all communications for security purposes and is safeguarded by three different insurers along with independent auditing. This ensures that you can safely pay your employees without worrying about losses. NatPay also requires two-factor authentication for payments. This technique utilizes an additional precaution, such as e-mail or phone verification, to bolster users’ passwords. Even if attacks do strike, the second factor acts as backup protection.

Direct deposit has become the most common payroll method in the United States, as it is advantageous for both employees and employers. Payments can be sent and received anywhere, and the process itself is far simpler than writing out checks. As such, it’s easier to learn and takes up less of your valuable time.

Employees don’t have to stress over losing paper checks or going to the bank. They can divide their pay into multiple different accounts and cash withdrawals, instead of having to deposit or cash an entire check at once. As another plus, many payment processing tools include features for workers to manage their money better.

If something goes wrong with a check, you may have to reissue it and face bank charges. Employees would also suffer, having to report a lost or stolen check and await the replacement. Direct deposit prevents these problems and allows you to send payments confidently.

As an example of the benefits of direct deposit, look at the case of Avail Professional Services. A small payroll business in Illinois, Avail aimed to offer their clients direct deposit. For the security and reliability that they needed, this firm partnered with NatPay. The national footprint of NatPay also made sure that people living coast-to-coast in different time zones didn’t throw a wrench in the payment process. Thanks to the universality of the direct deposit system and the speediness of payment transfers, NatPay was able to provide Avail with a payroll service that many banks and ACH providers simply cannot match.

mitigate risk with payment processing for businesses

Securely Use Paycards for Payroll

Payroll debit cards, also called paycards, also make for an increasingly attractive choice. These work essentially as reloadable prepaid debit cards. Instead of paying employees with a paycheck or direct deposit, paycards provide an instantly usable alternative.

Paycards share many of direct deposit’s advantages. These both represent fast, secure methods to pay employees. However, unlike direct deposit, a paycard does not even require an employee to hold an account at a bank. For the millions of people who do not have bank accounts, paycards can make for a compelling option.

Paycards serve employees’ financial needs as they arise, whether it’s withdrawing cash from ATMs or shopping at retail stores or online. These cards work practically anywhere bank cards do. Moreover, payroll cards have lower fees than banks and include their own online portal for managing funds.

As with direct deposit, paycards protect workers from fraud, theft, and loss. Cards are easy to replace, along with whatever money the individuals had saved on them. These payroll cards function like debit rather than credit cards, so employees won’t rack up debts that destroy their credit scores.

As much as employees like paycards, these cards also assist employers. You spend less time and money depositing to paycards than writing out checks. The fraud protection and other security measures also work for your benefit.

Use a Payment Processing Partner to Avoid Errors and Streamline

Smart payment tools make payroll more efficient and mitigate financial risk by avoiding potentially costly mistakes. The simple act of going paperless itself eliminates many of the common sources of error, like transcribing figures to checks. With NatPay’s e-statement and e-invoicing solutions, you can transmit secure financial information without fear of leakage. This not only works faster than paper, but it also brings information directly to your employees, making miscommunication extremely unlikely.

The automated workflow also reduces the risk of errors. Fewer people conducting manual data entry means fewer occasions for mess-ups. The practice of typing sensitive information by hand has become archaic. Whenever a rote business process takes time and resources, an opportunity for automation arises. For instance, you can auto-manage bonuses or other payroll tasks from start to finish.

In terms of payment processing, NatPay’s Document Processing Solutions automatically handle bill payments, fillable forms, tax and pay statements, and other critical needs. This approach displaces older manual methods prone to error. Furthermore, NatPay systems have security programmed in from the ground up.

Well-known retailer Family Dollar selected NatPay Online Paperless Solutions to decrease costs. They wanted to replace their previous manual process was laborious, slow, and error-prone. Instead of this paper system, NatPay provided Family Dollar with an affordable digital alternative, allowing them to send pay statements and tax statements entirely online. This new payroll process works efficiently and easily, and can securely handle the volume necessary for this large retail presence. Additionally, the paperless solution integrates with Family Dollar’s existing intranet! The firm’s payroll system is entirely paperless now, and the process has become much less expensive.

Using an online payment processor like NatPay gives you the latest tech automatically. Organizations are increasingly relying on cloud platforms for HR, finance, and practically everything else. Consolidate your systems online for greater accuracy.

Take Advantage of Integrated Finance Solutions

When different parts of an organization’s infrastructure don’t interact with each other, this leaves room for failure. For instance, copying information from one program into another can result in wrong data, unsent payments, and non-compliance. An integrated payroll and HR solution thus increase trust in the system.

Precise HR and finance solutions decrease payment errors that frustrate employees. As such, integrating these systems contributes to employee satisfaction and trust. Having fewer errors also makes regulatory compliance more feasible. Integrated services let you manage employee data in a simple system that reaches your entire business network, all through a secure server.

Combining your payroll and HR solutions also reduces manual effort, so data can flow from one system to another uninterrupted. And as a result of your integrated data flows, you then receive more useful analytics reports and insights. Consolidating systems, therefore, makes these tools more potent aids for real-time business decisions.

For larger national or global organizations, these integrated finance solutions become even more key. Businesses of any size, however, can take advantage of these powerful solutions to make their payroll more sound.

As an example, the Butler County school system in Kentucky recently converted to a NatPay-powered document processing system. Their paperless payroll now securely distributes information pertaining to salaries as well as taxes. Employees can log into the system whenever they feel like it and track their financial information. The school administrators had only to proffer the basic data from their payroll program, which NatPay then integrated with secure document processing facilities. The result? A highly efficient, environmentally friendly solution that the schools plan to expand into other areas of administrative business.

Use NatPay Secure Solutions to Mitigate Financial Risks

In the complex modern world, businesses face many unprecedented challenges. Fortunately, we also have numerous innovative techniques to adapt. Having a nationally respected partner on your side can give you the upper hand in managing risk.

To mitigate financial risk for your organization, it makes sense to combine as many of your critical payroll processes as possible. NatPay has developed multi-faceted approaches specifically to manage financial risk, covering your payment and document processing needs.

NatPay is ready to work with you to find a solution to all your digital finance needs. ACH payments, direct deposits, payroll paycards, electronic statements and invoices, process integration—we have a solution for everything. To find out how you can digitize and streamline your payroll, reach out today!

Digital Transformation in the Payment Industry

payment industry

Technology has transformed the payment industry. Discover how payment digitization can revolutionize your business, and begin your transition today!

Long gone are the days of fumbling around at the register with crumpled paper and too many coins. Thanks to years of tech advancements in the industry, businesses and consumers now have a multitude of payment options!

Since the advent of smartphones, peer-to-peer (P2P) applications, where customers simply log in to make a payment (think Venmo, Zelle, and PayPal), have become a staple in online shopping and money transfers.

The digital payment revolution has even made its way into physical transactions as well. Virtually all cards now have EMV chips, and in many cases, shoppers can simply tap their cards to pay. And in more recent developments, businesses have introduced payment methods via QR codes and biometric technology to simplify transactions further.

E-commerce has exploded thanks to these cashless payment tech advances. Consequently, transactions are less and less limited by geography, brick-and-mortar institutions, and slow turnaround times with mailing. It’s time for businesses to jump on board the digital revolution!

How Can Businesses Take Advantage of Payment Digitization

Digitization has completely changed the payment industry, and businesses stand ready to take advantage of these innovations—or fall behind if they don’t. Anyone who has an electronic payment app can send or receive payment from anywhere in real time. Why wouldn’t businesses want to avail themselves of this same technology? You can even use electronic payment systems for payroll. For instance, NatPay Payroll Direct Deposit Plus can digitize your entire process, so you can upload payroll files from anywhere.

NatPay also provides electronic pay stubs and pay cards, so your staff has options for how to receive payments instantaneously.

In addition to speeding up the payment process, electronic payment also ensures that both parties have a reliable transaction record. NatPay’s Doculivery online document management system of e-statements makes record-keeping easy, so you can avoid disputes and keep track of cash flow. These digital documents also make onboarding a fast and painless process. Instead of sifting through endless paperwork, the most you’re asked for is an e-signature.

The removal of physical currency from the equation also lessens the risk of theft. Cash can be stolen, but electronic payments are secured in a multitude of ways: tokenization, encryption, Secure Sockets Layer (SSL), and more.

Digitization helps both customers and operators alike. Customers no longer have to enter their card details every time, as they can save card details or complete transactions with a One-Time-Password (OTP). Meanwhile, on the business end, operators also save on processing costs. Instead of charging per transaction, some electronic payment systems simply charge a subscription fee.

payment industry digital transformation
Photographer: Carlos Muza | Source: Unsplash

New Means of Sending Invoices: From Old School to Digital

Before e-payment, clients and businesses had to rely on paper checks and the slow, costly turnaround of using the postal service to deliver invoices. Now, businesses can use e-statements, which virtually eliminate printing and mailing costs.

Along with cost reduction, e-statements also increase efficiency by cutting delivery time, as they are readily accessible from any web browser or email. E-statements are also a far more secure industry alternative to physical statements—for instance, NatPay’s processing center automatically encrypts client payment data using SSL.

And yet, despite how revolutionary digitization has been for consumers, the B2B space has yet to fully embrace its advantages. Many accounting and finance departments still rely on paper-based methods and in-person processes, which eat up valuable time and labor. Thus, digitization can save businesses on both materials and the clock. As the pandemic continues to radically change the business landscape, employers must urgently find contact-free ways to process invoices.

How Businesses Benefit from Digitizing Payroll

Digitizing payroll brings many of the same benefits as digitizing invoices. Moving to e-documents saves time, increases data security, and automatically creates an audit trail. Furthermore, digitized payrolls can help boost employee morale. Online payroll software allows employees to access their pay stubs and other documents quickly, from anywhere, with the assurance that their data is secure. These benefits are especially helpful for smaller companies that may have less human resource capacity.

Consider the case of Butler County School District in Kentucky. The district was tasked with overseeing over 300 full-time employees, an unwieldy task even in the best of circumstances. Like many school systems, Butler County needed to find a way to streamline and improve processes to fully maximize its budget.

After much research, Travis Johnson, the payroll manager for Butler County Schools, chose NatPay as their paperless statement solution. The school system now not only uses NatPay’s Doculivery online pay stub service but also utilizes NatPay’s W-2 online services.

The deciding factor was Doculivery’s user-friendliness and simplicity, making it easy for employees to adopt. “Doculivery is very user-friendly. Setup only takes a few minutes, and there is almost no learning curve,” said Johnson.

Any company, whether it has 300 employees or 3,000, can benefit from cutting material costs and saving time by digitizing. Paperless documents are quickly becoming essential if a business wants to remain competitive.

NatPay Helps Businesses With Digital Transformation

Digitization has helped businesses expand by helping them conserve resources.

Online payment methods cut down costs by eliminating paper and processing fees while freeing up employees’ time and boosting morale. In turn, the money and time saved by going digital can be used for other tasks. Businesses looking to keep up with payment industry trends need an ACH service provider that can offer everything one needs to go paperless.

A comprehensive ACH provider like NatPay provides services for the entire payment process. With services like Direct Deposit, online paystubs, pay cards, W-2 online forms, e-statements, and online forms, NatPay covers the payment process from beginning to end.

If you want to expand your business, digitizing payments is the simplest way to maximize efficiency and bring your business to the forefront of best practices.

Contact NatPay to start streamlining your payroll operations today!

How to Choose a Reliable Payment Processing Partner

payment processing partner

From payroll, benefits, and taxes, to bill pay— there's no end to the functions of your business that rely on reliable payment processing.

Finding the right payment processing solution can be challenging. There’s an abundance of payment providers to choose from, and it's difficult to know which one will offer the best service for your company as payment preferences differ across businesses and business types.

With an ever-changing payment landscape and teams being increasingly exposed to faster and more efficient payment methods, businesses need to keep pace with the latest payment solutions, and this often means partnering with a reputable payment provider that best aligns with your current and future business models.

In this article, you will discover some key elements to consider when choosing a payment processing partner that best fits your business needs.

payment processing partner

Payment Method Options

In an era in which instant gratification is the name of the game, consumers want their goods now, and this means offering payment methods that match that mood.

Today’s business leaders also want more options for payment methods than ever— whether in corporate receipt or execution. An important first step when choosing your business’s payment processor is determining what types of payment your business wants to use for executing payments to vendors, employees, contractors, and more. Offering modern, efficient payment systems and methods streamlines your internal operations.

No matter which payment types you offer, there will be advantages and disadvantages to each. Let’s unpack these.

Cash

One of the most common and easiest forms of payment is cash. It’s universally accepted, it’s fast and convenient, and doesn’t require additional fees. Vendors, however, may not want to use cash for large purchases, and carrying large amounts of cash is risky. It can also be time-consuming when you have to count and balance up each day.

Checks

Check payment is as reliable as the gold standard, and for good reason; as one can make more frequent or larger purchases safely and you need not keep unwieldy and risky cash on hand. Additionally, you won’t have to pay fees to execute checks.

The downsides, however, are myriad—check payments come with fraud risks, expensive audit components, and additional manual (and paper) processes added to your business. All of this can easily turn a ‘no-fee’ method of payment execution into an expensive component of your accounts payable and HR operations.

Debit Card & Credit Cards

Credit card and debit payments can be quicker and more convenient for your business than cash or checks. Debit and credit cards also facilitate frequent or larger purchases, and you won’t have to keep as much cash on site. Card payments also eliminate concerns about bad checks or fake cash, and international purchases—say, for a revolutionary software product from a team in the EU, or your widget vendor in Canada—can be executed cleanly and instantaneously. All of this is to say nothing of the clear wins in ensuring your team and department heads have spending authorization at their fingertips without executing manual check runs for essential business purchases.

On the flip side, card payments come with their own fraud concerns, they can’t be used for your bi-monthly payroll run, and some vendors and merchants are still slow on the uptake: you’ll likely find contractors that prefer slower but less expensive check acceptance over faster, interchange-laden credit card payment receipt. In an ideal world, your business would earn points and cashback with every vendor payment— in reality, you’ve got a special-use-case convenience option that doesn’t translate across your vendor portfolio.

Electronic Bank Transfers

Electronic bank payment methods go by several common and not-so-common names: online payment, EFT, Automated Clearing House (ACH), direct transfer, account-to-account transfer, and more.

It’s quick, easy, convenient, and allows you to execute large payments with minimal processing fees—a good option if you’re in the B2B space. It’s also more convenient than accepting cash or checks and eliminates the attendant risks that come with these traditional types of payments. Working with a strong payment processing partner further adds a layer of security; audits and payment security are their business, after all.

However, some vendors may be hesitant to provide bank account and routing numbers and anxious about transferring money directly you are their bank accounts to their business accounts. Even if their concerns are calmed, EFT processing always takes time. 2-3 business days is standard for ACH transfers—while faster than your AP team constantly answering calls with the check’s in the mail! These concerns are rarely subdued on the part of some vendors who might prefer more archaic methods of payment due to their so-called reliability.

Payment Security Features

There's a lot going on during the payment process. Apart from you and your vendor, there are card companies, acquirers, and issuing banks along the payment chain. It's thus crucial to have a firm handle on the whole process and reduce the risk at every possible point.

A 2021 survey found that 74% of businesses have fallen victim to payment fraud. This reinforces the importance of being proactive about cybersecurity rather than waiting for a crisis to happen and then reacting.

Here are some critical elements to focus on to ensure that your payment processing platform is secure, or, what to consider when choosing a payment partner for your business.

  • Encrypted Data: Transactions should be secured using Secure Socket Layer (SSL) or Transport Layer Security (TLS) protocols.
  • Tokenization: The best payment processing solutions will also employ tokenization. This substitutes sensitive data with random characters so that even if security is breached, the data is unusable.
  • ACH Payment Security: Every transaction should be monitored using advanced fraud protection tools to enhance ACH payment security and stamp out payment fraud.
  • N-Tier Technology: This adds an additional security layer by using three sets of servers and storage for processing and handling ACH payment requests. Each layer acts independently and reduces potential threat vectors.
  • 3-D Secure: Provides a similar security approach for credit and debit card transactions. Also known as payer authentication, 3-D security requires customers to complete an additional step with the card issuer to verify their accounts, such as punching in a password or security code sent to their phone or email.

Ensure PCI Compliance

Any business that accepts or remits credit card payments must adhere to Payment Card Industry Data Security Standards (PCI-DSS) guidelines that ensure customer data is protected. PCI-DSS covers everything from how data is collected, stored, processed, or transmitted and the security protocols that must be in place to protect customers’ data. A payment processing partner should ensure compliance with the required security protocols.

Integration with Technology

Some vendors like receiving cash. Others can't live without their credit card. When it comes to payment, vendors have their preferences.

Smart businesses are seeing this as an opportunity, rather than a drag, and are optimizing their accounting operations to provide access to real-time data that can help them run operations more efficiently and manage cash flow more effectively through payment integration—a critical piece of the payment processing puzzle.

The major benefits of payment processing integration include the following:

  • Saves time
  • Reduces human error
  • Increases cash flow
  • Drives down labor costs

As vendor payment preferences pivot from cash and check to electronic payments, it just makes sense to have the data from these new payment options seamlessly flow into your business accounting system without the need for manual entry. Accordingly, discussing the specific integrations you need before choosing a payment processing provider is crucial.

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NatPay Is Your Secure Payment Processing Partner

Choosing a payment processing partner can be complicated.

There are several factors to consider in determining which best aligns with your current needs as well as future growth plans. From security and compliance to volume and integration, you need a solution that handles transactions securely and seamlessly and mitigates payment fraud.

Businesses also need to keep pace with the latest in payments technology and source a partner that can work with you to create a payment system that will support your business strategy by offering customized and secure SaaS solutions.

With NatPay—the market leader in third-party enterprise payment processing solutions—choosing a payment processing partner does not have to be complicated. From direct deposit of salaries and wages, tax payments, and reimbursements to B2B payments, vendor payments, and benefit payments, NatPay can help you manage it all through rigorous and robust online systems.

Contact NatPay today for a free customized demo and if you like what you see, our team will prepare a free pricing proposal tailored to your specific needs.

The Importance of Customer Support From Your Payment Processing Provider

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ACH payment processing providers must offer a top-notch customer support experience. Learn why customer support is essential for B2B businesses.

Business owners have limited time on their hands. With many things to take care of, certain tasks may be more challenging to accomplish. Establishing and maintaining digital payment channels are two particularly tricky aspects of a business to deal with.

That is why having a trusted payment processing partner with a strong customer support system can be critically helpful in optimizing business operations. Business owners must establish a way to facilitate and approve digital payments quickly and efficiently.

In this article, you will learn why partnering with a payment processing provider that is focused on great customer service can benefit your business operations.

What Does a Payment Processing Provider Do?

A payment processing provider takes care of a business's customers’ digital transactions for your business. They act as a middleman between your customer and financial institutions to facilitate smooth and successful transactions. The payment processing providers ensure customer transactions have optimum security, as they generally have stringent safety measures to prevent breaches like fraud, and consistently adhere to industry compliance protocols.

A robust payment processing provider will generally handle a wide variety of digital payment types as well, including electronic wallets, such as Apple Pay, PayPal, and Alipay, electronic debit and credit cards, and wire and bank transfers.

However, despite the convenience payment processing partners provide, payments made through any digital space are subject to complications. For example, if a customer experiences a declined payment or has another snag during payment processing, the business could lose out on a sale, potential new customers, or lost faith from existing customers.

Processor technology alone can't fix these road bumps. Along with a smooth payment processing system, businesses need a strong customer support team to assist clients to secure overall business success. With efficient support in place from a trusted payment processing partner, businesses can foster trust and form meaningful relationships with customers.

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Understanding the Cause of Declined Payments

One of the most important roles of customer support when it comes to payment processing troubleshooting is determining the reason for a declined payment.

Generally, payment declines are grouped into two categories: hard and soft declines.

With a hard decline, the customer’s bank does not approve the transaction. This is often because it reads the transaction as potentially fraudulent, the account is already above its limit, or there is a data entry mistake.

Soft declines, on the other hand, occur when the bank that issued the customer’s accounts accepts the transaction, but there is a lapse somewhere else in the digital payment processing. This could be because the payment system is down, or something has gone wrong with the merchant’s software.

In the event of a declined payment, the sales agent handling the transaction must, as discreetly and quickly as possible, inform the customer of the situation. Customers should connect with their account servicer to establish their recommended course of action. Sales agents must also double-check the customer’s personal information, rule out the possibility of fraud, and ensure the payment account is still viable for use.

Prevent Fraudulent Transactions

It is essential that your payment processing provider has a customer service system to block fraudulent transactions.

Fraudulent transactions often occur when account information is stolen. Thus, businesses must be able to rely on a support team well-educated on how to spot potential fraud.

In instances of fraud, time is of the essence. For the best security and customer peace of mind, using systems like NatPay’s DDPlus (Direct Deposit Plus) ACH distribution solution is highly recommended. Customers can have their funds securely and immediately transferred to different financial accounts to curb fraud losses.

The ACH distribution system makes it much easier to reconcile data, allowing for more efficient tracking. Additionally, the ACH distribution system is incredibly simple to use. Even the least tech-savvy individuals can learn how to navigate it, making more efficient payment processing a breeze.

Customer Support Can Address Inquiries or Issues Involving Large Transactions

There may be instances when customers perform large transactions. Generally, the larger the amount of money transferred, the higher the chance of a prolonged transaction. This is often for bureaucratic reasons: the financial institutions involved want to ensure that the money is valid.

Another common reason for the delay is vetting for suspicious activity like money laundering. In the event of a delay in this sort of scenario, having a payment processing partner with a strong support team proves advantageous because customers can air their concerns and raise their issues with a dedicated representative.

If you are making a large transaction, it is best to plan ahead. Using a payment processing system like NatPay’s Direct Deposit prevents issues typically associated with doing large transactions. You can automatically upload your payroll files from anywhere and access emergency payment processing for quicker and more streamlined payment facilitation.

Partner With NatPay For All Your Digital Payment Processing Needs

Founded in 1991, NatPay is the premier third-party payment processor for employee payroll. From launching the first electronic payment stub, branded EZStub, in 2000, all the way to the present, NatPay has kept its place as an industry innovator.

NatPay now manages roughly $118 billion a year for ACH clients across the country.

NatPay’s Doculivery SaaS (software as a service) tool is one of its premier offerings, providing robust enterprise resource solutions. Through Doculivery, you can manage payroll, CSR, AR/AP, and a host of other online solutions. You can even conduct HR processes on the platform itself, eliminating the need for pen and paper.

NatPay is ready to move your payroll processes into the digital era! See how NatPay can help you optimize your business processes: reach out today!

An Integrated Approach to Document Processing and Finance Solutions

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Paper documentation is quickly becoming obsolete. Consider switching to an integrated solution like NatPay for your document processing and financial needs.

When it comes to document processing, it helps to integrate all your solutions into one easy platform. Rather than struggling to keep track of scattered paper documents loaded with highly sensitive information, it makes sense to choose a solution that allows you to manage, send, and receive documents in a central location. An integrated service provider gives you the power to accomplish your goals far more effectively than with traditional approaches.

Integrated digital document delivery and finance solutions also can generally work with your available assets. In addition to protecting customer data and your own data, this document processing approach allows for total customization of your current operations.

For example, an online document management solution like NatPay’s Doculivery is just the ticket. Their protected web interface allows one to send, receive, and process documents with greater speed and tighter security than, say, via the post or email with rudimentary encryption.

Further, the integrated nature of the platform allows you to handle various finance operations via one easy solution. The easy accessibility of ready e-statements and e-invoices allows for effortless documentation concurrent with your financial transactions. The system makes financial activity as simple as email—and safer than email, as well.

Whether sending pay statements, bank statements, tax statements, or any other financial documents, e-statements are the way to go. They offer convenience and customer satisfaction while decreasing paper waste and clutter, and reducing the chance of errors or lost documents.

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Some Advantages of Taking An Integrated Approach to Document Processing

Taking an integrated approach to document processing offers multiple compelling advantages to make business more efficient. For starters, this method requires less storage space than paper processing. Rent costs money, and clutter is a nuisance. You can also cut out the costs of cabinets and other storage equipment.

Integrated document processing offers tighter security than paper, with precise access controls. Digital systems also track who has seen documents and when, and any modifications they may have made. Smart alerts notify organizations of access attempts immediately.

The increased security of an electronic approach allows organizations easier compliance with privacy regulations like the Health Insurance Portability and Accountability Act (HIPAA). More accurate and automatic document management decreases risks regardless of industry, including fines or more severe penalties.

As another bonus, document processing systems drastically cut the time and money spent by organizations on handling information, thus increasing productivity. Search faster, connect with other services effortlessly, and use documents securely from anywhere. You can also collaborate more effectively with an integrated approach, even with external partners.

In case of an unexpected disaster, a document processing system includes automatic backups, something a paper filing system cannot offer. This makes your document storage far more robust, whether in the face of fire, flood, theft, or any other crisis. Staff will feel more confident with an integrated document processing system.

For example, the Butler County school system in Kentucky went paperless, switching their financial documentation processes to an entirely online model. They needed security with an affordable price tag. The school system found a user-friendly and regulation-compliant solution in NatPay’s Doculivery tool. NatPay’s services also helped them maintain security regulations easier than their old system: Doculivery functions to be compliant with SSAE 18 type 2 audit examinations, which requires an ongoing commitment to information security and data communications.

The Kentucky schools supplied the basic payroll information, and NatPay made the new system work. The setup now allows staff to administer payroll easily, at around half the total cost of using paper. With document processing, employees receive their statements securely and on time.

Integrate Your Finance Solutions!

Just as digital document management offers industry advantages, so are the benefits of an integrated approach to finance solutions.

Having a solid, stable system for making payments that work with your infrastructure can increase your efficiency. You can send payments faster, with greater reliability, and with immediately available electronic records.

E-statements and e-invoices make processing transactions a snap. Whereas delays run rampant in more analog options, integrated document and finance solutions allow instant communication, a must in this day and age. And unlike with paper statements and invoices, one can be certain their electronic counterparts only ever go where they are supposed to go, via secure encrypted connections. E-documents can cover information pertaining to medical claims, expense reports, school grades, or practically any other data that you want to keep confidential.

mobile document processing

Document Processing and Finance Solutions with NatPay

For handling documents without paperwork, as well as conducting payroll and other financial activities, a service provider like NatPay can be a huge help with document processing. A trusted enterprise solution can take care of the administrative work for less than it would cost to manage it yourself while powering up your execution and relieving security and compliance concerns.

Arguably the greatest advantage of using an integrated solution for document processing is increased security. E-statements and e-invoices keep documents protected in a data center with the latest technology and oversight. As account information goes through secured channels exclusively, there is no chance of leaked or stolen documents.

When it comes to financial solutions, NatPay’s Doculivery service complies with most state and federal tax and payroll regulations. Process financial information confident in the knowledge that it abides by all relevant legislation, and remains archived for later reference.

With tax and payroll data readily available, your organization can conveniently respond to any audits or other legal issues. And as new regulations emerge (because they always do) the system automatically adjusts to incorporate these changes.

When it comes to document processing and finance solutions, NatPay offers a complete package that works with your organization.

Contact NatPay today to take advantage of services such as direct deposit for paychecks, ACH payments for expense reimbursements and other applications, and secure e-statements and e-invoices.

3 Ways Recent USPS Changes Have Impacted Business Operations & What You Can Do About It

usps changes

Solutions to combat the effect of USPS changes and how to set your business onto a path of increased efficiency, reliability, and lower expenses.

The US Postal Service (USPS) plays a significant role in most business operations. Companies of all sizes depend on the postal service to ship products and mail documents around the country—including important financial documents. However, the continuous postal price increase and other USPS changes recently implemented have placed a strain on business operations and instilled doubt in the reliability of postal services.

Price increases alone can inconvenience a business massively. But additional delays and policy changes have also placed doubt on the reliability of the USPS, especially as it pertains to important or urgent financial and business documents.

However, there are alternative solutions for businesses available to help combat the USPS changes in efficiency, reliability, and cost.

In this post, we discuss digital enterprise solutions available that can free your business from expensive and inefficient paper documents.

Recent USPS Changes to Services

Increasing fees, slower shipping timeframes, and systemic delays all factor into business decisions to look elsewhere for more feasible alternatives.

1. Changing—And Often Unpredictable—Service Times

In October 2021, USPS announced new standard shipping times for first-class mail. Beginning May 1st, the standard for packages to be considered on time will extend from three days to five days. For those who manually handle payments and financial documents, this may pose a significant problem in administrative and payment timelines.

With over 6.8 billion mail items (more than 4.5% of the yearly outbound volume) considered undeliverable in 2020, this only exacerbates questions of dependability. Despite the common USPS refrain, “Nor snow nor rain nor heat nor gloom of night stays these couriers,” weather delays, changes of address, and other unanticipated events all do frequently cause service interruption.

An uptick in assaults and threats to postal workers has led to further disruptions. For example, for several days in April, the USPS simply stopped servicing several blocks in Santa Monica, California, due to a series of ongoing threats to workers. While service later resumed, the disruption to personal and business mail had already happened. These sorts of unpredictable occurrences leave businesses powerless to ensure that documents arrive on time.

2. Cost Increases

It’s not only delays that have affected USPS either. As service slows, the cost of it is on the rise. Besides the annual shipping rate increases in January, another price hike of upwards of 8.5% is on the horizon for July 2022—with more changes to follow.

USPS is adopting even more surcharges for certain delivery areas as well. Considering how businesses often provide free shipping, the brunt of these increases falls entirely on individual companies.

3. A Loss In Credibility

These increased fees and wait times would be a dent on their own, but they're part of a wider loss of credibility for the organization as of late. Policies proposed by new officials at the USPS have put the historic organization’s credibility on the line. In particular, the newly instated Postmaster General Louis DeJoy has come under heat regarding the efficacy of several cost-cutting measures put into place or suggested.

Internal projections of revenue saved from measures like slower service and increased mail and postage fees (as well as more disruptive suggestions like canceling Saturday service) just don’t add up.

The Postal Regulatory Commission—the organization’s own regulatory board—announced recently that “at present, the Postal Service has not demonstrated that it can achieve reliability, efficiency, and economy in its service standard changes.”

Changes such as reduced and longer service and higher fees do not seem to have much if any bearing on the service’s finances while placing a higher burden on service users. This very vocal analysis from the USPS itself pushing back against changes has led many to question the organization’s reliability at this point.

Changes that seem to be made for the sake of a change do nothing for an organization’s credibility—especially one relied upon by as many people as the USPS. Coupled with federal investigations into the Postmaster-General regarding campaign finance and ethics violations, it raises the question of the organization’s overall trustworthiness.

usps changes

Digital Solutions to Improve Business Operations

It’s increasingly clear that businesses must find alternative solutions to get important financial documentation from point A to point B safely, quickly, and consistently.

Here are some solutions for what businesses can do to minimize the effects of these USPS changes on business expenses—while also making your operations more efficient.

Conduct Transactions and Invoices via ACH Instead

Automated Clearing House (ACH) or direct payments transfer funds directly between bank accounts, eliminating the complications of ordering, writing, checks and mailing checks. More secure than waiting on mail services, ACH payments reduce non-delivery and shipping delay risks.

Since ACH payments do not require manual entry, receiving funds doesn’t hang on the time it takes for checks to make their way through the mail. Unlike mail checks, payments cannot be lost, as they occur near-instantaneously. ACH also provides automatic recurring payment options, with lower fees than credit card payments. Considering how all ACH payments must adhere to a strict security standard laid out by the independent National Clearing House Association (NACHA), you can also be sure of every payment’s safety.

In short, ACH payments offer a clean and comprehensive answer to shipping disruptions and trustworthiness in your financial matters. In the face of a slower, more expensive, and less credible USPS system, ACH can offer the changes you need.

NatPay offers comprehensive ACH distribution solutions for all types of payments. From tax payments and expense reimbursements to commissions, receivable collections, dividends, annuity, and vendor payments, NatPay has you covered. With multiple timing options, you have complete control over fund distribution. And NatPay also guarantees full NACHA compliance, meaning no yearly audits on your part!

Adopt a Modern Workforce Solution with Online Document Management

Effective paper document management depends on time and money. But continuous USPS changes make it hard to forecast and maintain a clear budget. Delivery is time-sensitive and subject to both controllable and uncontrollable delays.

On the other hand, online document delivery solutions like NatPay’s Doculivery eliminate the concerns that go along with physical mail distribution, saving you time and money.

Take, for example, the example of the Butler County School system in Kentucky. With over 300 full-time staff, the school district needed to minimize expenses, improve processes, and streamline its administrative processes.

They adopted NatPay’s Doculivery online document management service to eliminate paper pay stubs and W-2 forms, giving employees access to these documents through a secure online portal. The latest, industry-standard encryption methods and security protocols ensure the safety and security of payment information, while the system is also extremely easy for employees to access. Doculivery took only a few minutes to set up, with minimal training required.

After just a few months of implementing the Doculivery system, BCS anticipated a whopping 50% savings, thanks to the scale-back on time, paper, ink, printing, and postage. Employees also stated that they found the system convenient to use. BCS plans to adopt Doculivery in other areas to further drive savings and streamline business processes. Rather than hobbling on with a paper mail-based operation, they’ve upgraded for the digital age.

Time to Go Fully Paperless

Payroll documents and financial statements are time-sensitive and confidential. Paper management slows down productivity, contributes to clutter, and provides little security, especially when shipping documents long distances. Getting rid of your paper management process entirely is the best way to avoid these disruptions.

Natpay’s e-Statements and e-Invoice solutions use push technology to securely transmit financial documents to employees and customers. The secure links allow intended recipients exclusive access, so they can get a private overview of account balances and transactions with just one click.

The electronic storage system eliminates the need to dig for files and papers, and minimizes the physical storage space required. Documents can’t get lost or misplaced—in fact, you have them accessible on-demand! This helps you to monitor accounts and detect fraudulent activity more efficiently.

NatPay has been providing electronic pay statements to thousands of employees nationwide for over 20 years, and continuously upgrades security to keep at the forefront of information protection.

Transitioning to e-Statements and e-Invoices not only safeguards your statements more effectively; the switch also offers major cost savings. Aside from the administrative time saved, digital documentation cuts out all of your annoying printing, envelope, and paper expenses.

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Source: Shutterstock

Get Your Business on Top of Any Change with NatPay

While payroll software is not a new phenomenon, digitizing your systems is increasingly necessary to maintain speed and security standards. NatPay provides the tools to save you time, reduce expenses, and improve the security of every payment you make. A leader in ACH payment for over 30 years, we offer the attention to detail your business’ transactions deserve. From ACH payments themselves, to secure document delivery, to e-Statements and e-Invoices, NatPay has a digital solution for every aspect of your finances.

While once a mainstay of business operations, the changes the USPS is undertaking will only make your financial transactions costlier and slower—at a time when businesses are prioritizing cheaper and faster solutions. Consider making the jump to digital today. NatPay is here to guide you into the electronic era of payment!

Contact NatPay today to see how digital finance systems can help your business.

Electronic Payment Methods: A Primer for Business Operations

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Electronic payments go far beyond payroll direct deposits. Electronic payment options are critical to the success of any modern business.

These days you can pay for just about anything with a tap of your credit card or mobile wallet, such as ApplePay. People want to pay online quickly and consumers appreciate it when companies make the electronic payment process as smooth as possible. In this digital age, increasingly demanding customers want super-fast services across the supply chain, and electronic payment portals are no exception.

Electronic payment systems, such as credit, debit, e-wallets, and mobile payments are growing in popularity and making payment processes more secure, transparent, and hassle-free for both customers and businesses.

In the eCommerce space, Automated Clearing House (ACH) payments are on the rise too. From 2019 to 2020, the number of payments processed through the ACH Network climbed 8.2% to 26.8 billion payments valued at $61.9 trillion, according to the National Automated Clearing House Association (NACHA), the body that oversees the ACH network.

Whether you are selling partial inventory on eBay, taking online payments through PayPal, or setting up an informational digital product store on Shopify— it’s essential to get set up with a method of accepting electronic payments.

In this blog post, you will learn the how and whys for ensuring your business is set up to be successful with your electronic payment options.

Electronic Payment Solution Options

Choosing an electronic payment solution is an essential decision for any business and there is no one-size-fits-all solution. You must evaluate the needs of your business and source an electronic payment provider that offers solutions to fit your unique situation.

Figuring out the best ways to accept electronic payments and a payment processing platform can be daunting when there are so many options and providers to choose from.

Beyond fees, fraud, and conversion—your company’s ability to expand internationally can also impact your electronic payment processing choice. There’s much to consider, from the transaction fees to fine-print contracts.

1. Credit and Debit Cards

It’s also important to give some careful thought to the ratio of credit card transactions the business will process in person, online, and over the phone. As well as which type of credit or debit cards you will accept

Visa, Mastercard, Discover, and American Express are the most popular. Before choosing an electronic payment solution, take time to compare because processing fees vary between transaction types and card types. You also need to consider the volume of transactions you anticipate you’ll be processing each month because some companies offer better rates for larger volumes.

If you running an online-only business, make sure your payment processing provider integrates easily with your website. Bear in mind that some, but not all payment gateways offer consumer financing options, which can help boost conversions.

For brick-and-mortar-type businesses, you need to take into consideration new integrations—like payment terminals—and ensure they are compatible with your current system. Processing fees range from around 1.3% to 3.5%, in addition to the card processor's cut. Other fees, which go to the card's issuing bank and the credit card network, are non-negotiable.

Debit cards use a different pricing model, and generally cost less for merchants. Also called check cards or bank cards, a debit card is a payment option that deducts money directly from a consumer’s checking account when it is used. The money that can be spent with a debit card is tied to the account balance—you can only spend money you literally have.

2. ACH Electronic Payment Transactions

The Automated Clearing House (ACH) is the umbrella term for a network that moves money between bank accounts across the USA. It’s run by the National Automated Clearing House Association (NACHA). Payments via ACH are made through the ACH network, rather than credit or debit card networks such as Visa or Mastercard.

ACH transfers tend to be less costly than card transactions because they don’t need to be routed through expensive card networks. The median internal cost for processing ACH payments is $0.29 per transaction. In addition, ACH payments are not required to follow the same PCI-compliance guidelines as credit card transactions. However, NACHA requires all parties involved in ACH transactions to implement processes, procedures, and controls to protect sensitive information and to encrypt banking information such as a customer’s bank account and routing numbers.

Moving money between bank accounts usually takes 3-5 days with ACH, with some ACH transactions now processed in a day.

Direct Deposits

These cover all deposit payments from businesses or the government to consumers. It includes payroll payments, reimbursements for employee expenses, and payments from government agencies for social security, other benefit programs, and tax refunds, as well as annuities and interest payments.

Direct Deposit Plus is an ACH distribution solution offered by NatPay, the market leader in third-party processing of Direct Deposits is unmatched here.

Why? Well, while other ACH distribution solutions usually require accounts to be held with banks or providers or that you purchase additional software, with DDPlus ACH distribution, no matter what type of software your organization currently uses, NatPay ensures compatibility and accuracy. Funds are electronically deposited into specific bank accounts: checking, savings, or any other type of account at any financial institution.

Direct Payments

ACH payments are a type of electronic bank-to-bank payment method in the US and are different from card payments. Since ACH payments are not routed through the more expensive card networks, it tends to be a cheaper option for electronically transferring funds.

Using the US bank-to-bank infrastructure to process an electronic payment brings additional benefits for entities in that anyone with a US bank account (businesses or consumers) is able to pay via the ACH system. It can also help with client retention.

Credit and debit cards expire, which can lead to potential customer churn. With an ACH transaction, however, a bank account is the source of funds and the risk of involuntary churn is significantly reduced.

There are two main types of ACH transfers—ACH credits and ACH debits. They largely differ in how the funds are transferred between accounts. With ACH credits the funds are pushed into an account, while with ACH debits the funds are pulled out of an account.

For businesses taking recurring payments, NatPay offers an ACH Direct Payments option.

How do ACH payments work exactly?

Let’s take your automated monthly phone bill payments as an example. When you sign up for autopay with your telecoms company, you provide your checking account information (routing and account number) and sign a recurring payment authorization.

Then, when you hit your billing cycle, your phone company’s bank (Originating Depository Financial Institution, ODRI) sends a request to your bank (Receiving Depository Financial Institution, RDFI) to transfer the money owed. The two banks then communicate to process the transaction. If you have sufficient funds, the transaction is processed and the money is routed to your phone company’s bank account.

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3. Mobile Payments

The transformative potential of the payments industry has been the focus of attention for years. In 2019, the electronic payment sector witnessed an unprecedented influx of investment, attracting $15 billion, 20% more than the preceding year. Impressively, the numbers show, that this funding injection made up a quarter of the investments into the whole fintech industry, and that was before COVID-19 struck.

Last year, 2021 set the stage for a further breakout, but this time in the mobile payments space. When the pandemic hit, people quickly shifted to new behavior regarding how they paid and received funds electronically. Mobile payments ticked many boxes amid this seismic shift in everyday life and it’s become increasingly easier for companies to integrate new electronic payment services thanks to third-party services, such as NatPay.

A hallmark of innovation is the ability to reinvent norms so customers have flexible, convenient options. Traditional customer experiences typically require citizens to wait agonizingly in line at a store or office to pay for monthly utility bills. But thanks to technology, businesses can now offer an easier solution: mobile payments. With mobile payments expected to hit $161.41 billion this year, this payment method is rapidly emerging as a big player in the digital payment ecosystem and is predicted to grow to $930.44 billion by 2026.

Mobile payments are clearly booming and simplifying the transaction process for both the merchant and the customer.

Types of Mobile Payment Options

  • Near Field Communication (NFC) These are contactless payments between a mobile and an NFC-enabled card reader. A common example of an NFC payment is when a customer stores their bank details in their mobile wallet (a virtual wallet that stores card information on a mobile device), opens that wallet (ApplePay or SamsungPay, for example) on their phone, and ‘taps’ the card reader as they would with a physical credit card.
  • Quick Response (QR) codes – QR codes are two-dimensional square codes that are decoded once scanned with a customer’s phone camera, or with a QR code scanner. Generally, once the code has been scanned, a link in the phone’s browser may open asking for payment confirmation.
  • Magnetic Secure Transmission (MST) MST payments use magnetic signals to generate a connection between a mobile device and a POS terminal. When customers hold their phones against a POS terminal, the phone emits a signal that mimics the magnetic strip on a credit card.

4. Wire Transfers

Typically, you can get the money transferred much faster with wire transfers, but they're pretty expensive—costing the payer an average of $25 per transaction, and even more for international wire transfers.

On top of that, some financial institutions may also charge the recipient a fee to receive the funds. Wire transfers are processed in real-time, as opposed to ACH payments, which are processed in batches three times a day.

Because of their high cost and speed, wire transfers are suited for large or time-sensitive transfers, either within the US or abroad. But if time sensitivity isn’t an issue, the lower cost of an ACH payment offers a significant advantage over a wire transfer. It’s important to note however that ACH transfers are only available in the USA.

5. Electronic Payment Online Gateways

Payment gateways relay transactional information to issuing banks, which in turn authorize or decline such transactions. Simply put, payment gateways facilitate communication between banks and sellers.

The software performs a number of tasks from the moment a customer places an order online. It first encrypts bank account information that would be sent to the vendor. This transaction data is then sent to the payment processor that the acquiring bank uses. Upon receipt of the encrypted data, the payment processor sends it to a card association for authorization. Ultimately, the bank is responsible for authorizing or declining such a request. Once approved, the processor sends the authorization to the payment gateway, which transmits it to the interface for processing, after which the merchant fills the order.

Types of Electronic Payment Gateways

Redirects

PayPal has evolved from a simple way to send money to friends and family into a company that offers both online and in-person credit card processing and is a great example of a redirect. When the gateway takes the customer to PayPal to process and make the payment, a redirect occurs.

Redirects provide a convenient and secure payment platform and a flexible platform for merchants, too. Paypal’s Payflow gateway offers a couple of options: a $0/month checkout payment gateway hosted by PayPal, or a $25/month option which offers greater customization capabilities. Both options come with PayPal's fraud protection security at no extra charge.

PayPal currently charges processing fees of 2.9%, plus an additional 30 cents per transaction.

Checkout On-site, Payment Off-Site

Stripe is an example of a payment gateway that uses this approach. The front-end checkout happens on the merchant’s site, but the back-end processing is handled by Stripe. As with redirects, this method offers simplicity for merchants. It’s convenient for customers too, because they don’t need to leave your site and hop onto another to complete their transactions.

Popular with SMBs as well as larger companies like Lyft, Stripe handles mobile e-commerce as well as SaaS and platform-based payments. Processing fees for Stripe are currently 2.9% and 30 cents per transaction.

On-Site Payments

As the name implies, on-site implies that the entire payment process takes place on the merchant’s secured website, reinforced by using SSL encryption and the latest software. Customers enter their payment details on your site at the checkout screen, creating a seamless transaction.

This approach is typically favored by large online merchants with the expertise and resources to manage it effectively. From a customer’s perspective, onsite payment processing is a smooth process and will most likely result in more completed transactions, and having fewer abandoned carts could significantly improve revenues. Whether that balances out the added costs of setup and ongoing payment gateway/SSL costs is a decision each business needs to weigh for itself.

NatPay—Your Third-Party Processing Solution

The payments revolution is in full swing with electronic payment methods transforming how we bank, pay, and do business with innovations in the payment industry giving rise to a simpler and more efficient way of managing payments. Gone are the days of relying on traditional methods, such as cash and checks. Moreover, the ever-evolving technological landscape has led to an eCommerce explosion that has spurred the demand for efficient and secure payment systems.

Cash payments are still with us especially for low-value transactions because it's universally accepted, along with speed, anonymity, and lack of fees. And while credit cards and debit cards are capturing the lion's share of payments at both the POS and online, the rise of the smartphone has given customers unprecedented access to an ever-expanding range of services. Mobile apps or applications have enabled payments for everything from ordering food to booking vacations, as well as offering the option of quick, secure payments through banking apps.

In the dash to ditch cash, more and more businesses are turning to ACH transactions for both payments and receivables collection, not only because it's more secure than cash or checks, but it offers convenience and security for customers too. And NatPay can help with all your third-party processing needs because our distribution solutions go well beyond just payroll direct deposits for employees. From direct deposit of salaries and wages, tax payments, and reimbursements to B2B payments, vendor payments, and benefit payments, we can help you manage it all through our rigorous and robust online systems.

Partner with a strong electronic payment provider, like NatPay to assure all your payments are processed through an industry-leading security standard, so you can focus on running the rest of your business operations.

Payment Security Best Practices in Enterprise Financial Operations

payment security best practices

Your business should be using all measures possible to prevent fraud and breaches to ensure payment security, enterprise ACH payment is the way forward.

What keeps finance executives up at night? The same thing that keeps the rest of us awake—security breaches. As the business world becomes more global and digital, the need for payment security has grown with it. A successful breach can result in the loss of millions of dollars, as well as damage a company’s reputation.

As financial technology, or fintech, continues to advance, there are new ways for businesses to accept payments. While the use of credit and debit cards is still the most common form of payment for both online and in-person transactions, the implementation of new fintech services is on the rise.

Card payments are an increasingly popular payment option for many in the US. The number of cards used—Visa, MasterCard, American Express, and Discover—reached 694 million in 2019, according to CardData. With this impressive volume comes a 5.2% year-on-year growth forecast that predicted seeing 768,052,576 cards available for use by the end of 2021.

The payments industry is growing and shifting at a rapid pace, becoming more complex as new technologies and diverse payment methods emerge. In addition, the regulatory environment is often complex and ever-changing, requiring payment service providers to ensure their processes are secure and compliant with current rules and regulations.

There are several strategies and best practices that companies can utilize to ensure the security of their payments, as this post will outline.

payment security

What are Enterprise Payment Solutions?

Enterprise payment solutions are a comprehensive payment platform that balances anonymity and transparency. The engine process payments through the appropriate channels and provide tracking and reporting to both the financial institution and the customer.

For firms processing transactions at a much larger scale with many different locations (nationally and internationally), it can be challenging to keep track of which payments are authorized and which aren’t. A streamlined process will allow for not only a broader range of payment solutions but also accommodates different types of payments.

Enterprise payment solutions work as fast, easy, and secure payment hubs—they create a unified network of payments that simplify things for you. You can monitor and manage all different types of payments, such as ACH, wire, instant payments, and TCH real-time payments, across a single, easy-to-use interface, and process these varied transaction types much faster.

Benefits of Enterprise Payment Solutions

With firms already having complex financial systems, the last thing they need is more complexity in terms of financial management and operations. Utilizing APIs, Enterprise Payment Solutions works with your financial systems already in place and simply connects them, allowing them to speak the same language and giving you a platform that facilitates easy tracking and reporting with all your transaction data in one place.

Being able to get an easy overview of all your payment data, you can begin to create a much better payment strategy that reflects the cost per payment and payment channel with greater accuracy. Enterprise Payment Solutions give you a much broader view of your existing payment ecosystem. With this smart and efficient technology, you are able to not only see the bigger picture, but also zoom in on details such as receivables and payables, available payment options and methods, vendors, card volumes, and payment processes.

Monitoring individual aspects of the digital payment journey gives you the clarity needed to create comprehensive and holistic reports that can generate more accurate predictions and can help refine your financial strategy. Perhaps the biggest benefit of Enterprise Payment Solutions is the robust security protocols allowing you to closely monitor what comes in and out of numerous accounts, where it originates, and who it comes from.

payment security

Payment Security Tips in the Enterprise Payment Space

There is, however, the very real possibility that companies can fall victim to security breaches. Credit cards, for example, have allowed faster payments but also bring with them the risk of sensitive data getting into the wrong hands. With credit cards, it is not only card data that is stored but also personal identity data. Securely managing this data is thus crucial.

Take Advantage of Security Technologies

Address Verification System (AVS)

The system cross-checks the credit card holder’s address information that is on file against the address provided by the individual making a transaction. After deciding whether this info matches or not, the system signals the merchant, who can make a verification request to the bank if they aren’t all that confident in the information they receive.

Upgrade to chip readers

Counterfeit cards are one of the most common types of fraud prevalent in US stores. It's an easy crime to commit and hard to solve. There is a good explanation for this: we're behind on implementing EMV technology (taken from a combination of the Europay, Mastercard, and Visa – the three credit card companies that developed the tech). The US has been slow to adopt chip readers, but it's high time they do.

Process online payments safely and securely

Even if you process payments online or over the phone, you can do this securely by lookout for the following red flags before processing a payment:

  • Orders that have several of the same items.
  • Orders involving “big-ticket” items, such as TVs.
  • Multiple same-day purchases.
  • Multiple purchases come from the same IP address.
  • Rush orders.
  • Orders that have failed AVS (Address Verification Service) or CID (the three-digit value on the back of the card).
  • International orders from countries that you usually don’t have customers in.
  • Orders that are shipped to a single address, but made on multiple cards or using multiple billing addresses.

Secure network access

Secure your network by limiting employee access to sensitive data, using updates to the latest versions of software, and increasing your cybersecurity efforts by using separate devices for your personal and business use. Roll out layered security measures like generating strong, complex passwords as well as two-factor authentication. System encryption can keep malicious third parties from getting their hands on your information.

Ensure PCI Compliance

PCI or Payment Card Industry compliance is a non-negotiable in terms of financial security in enterprise payments. PCI is all about strict data security standards and sets the bar for what customers should expect in terms of data protection from those handling their financial information.

While there’s a range of actions an enterprise needs to take to meet compliance, they should focus on three important areas… And get a PCI consultant to guide them through the rest.

  • Collecting and transmitting credit card data securely.
  • Ensuring credit card data is stored safely and securely.
  • Annually proving that required security protocols are met.

Stamping out Human Error for Increased Payment Security

The potential for human error always looms large and mistakes can put your entire system at risk. Here are four ways to mitigate this.

Installing anti-malware software

Employees connecting to your system can put you at risk by downloading malware onto their work devices (which most often happens without their knowledge), and consequently infecting your system. Anti-malware software installed on your systems can detect malware that may be present.

Limiting user credentials

This will help to ensure minimal damage even if hackers and cybercriminals gain access to a legitimate user’s account.

Use logging mechanisms

You need to know who is accessing your system and what they've accessed. Monitoring user activity can help you find out what information they have access to and how to protect it.

Train your employees

Your workers should be thoroughly grounded in your enterprise's security processes, policies, and systems. That way, they can help keep systems secure and know what to do in the event of security breaches.

payment security

NatPay & ACH: The Smart, Secure Way To Handle Payment Security

National Payment Corporation (NatPay) has become the leading company to offer third-party processing of Direct Deposits for employee payroll, processing more than $115+ billion annually for 228,000+ ACH clients nationwide.

NatPay has been the pioneer in payroll distribution solutions since 1991, offering multiple levels of data encryption and file protection that are unmatched. In addition, NatPay is integrated with most accounting and payroll processing software. If not, no problem. We specialize in custom integrations.

The challenges of payment card processing can be circumvented entirely, and NatPay can help. As an industry leader in bulk payment processing services, we can help your enterprise sustain its success with our secure online systems.

Book a demo today, and together, let’s build a customized solution for your organization.

Technology Advantage: Saving Time and Money with Automation

technology advantage with automation

Gain a technology advantage with automated solutions. NatPay's automated invoice systems reduce errors, improve efficiency, and enhance security.

A company’s invoicing process often represents its relationship with both clients and suppliers. Contractors will always flock to clients who operate invoice systems with prompt processing and timely payments. After all, everyone appreciates being paid on time!

But while simplifying the invoice process is easy enough for small businesses, firms that deal with hundreds or thousands of suppliers can run into problems if they can’t track orders fast enough. In cases like these, automation can help streamline the process and provide a massive technology advantage over your competitors.

The Typical Invoice Process

Your finance department’s Accounts Payable (AP) division is usually tasked with paying external partners, and so instinct might be to go knock on their office door to see why you’re behind. However, any veteran AP worker will tell you that only verified bills and invoices undergo processing. This is the main reason why the space between billing a client and receiving payment can often run anywhere between a week to 90 days. Invoices need to pass through a whole slew of verification processes.

If an invoice has all its details complete and correct, the processing shouldn’t pose any problems. However, that’s a big if. Incomplete, inaccurate, or illegible invoices quickly get bounced back to the sender, turning back the clock on the processing period with every instance. Sometimes, the mistake happens within the AP department. Paper documents often get lost, mislabeled, accidentally shredded, or damaged—and the process begins yet again.

A typical AP employee can churn around five invoices a day. Once incoming invoices outnumber the people assigned to them, you might need to hire more help, before your staff burns out. But for some companies, late invoice payments can mean additional costs. Many suppliers charge a fee for late payment. In addition, your reputation as a prompt payer can take a hit. This can serve as a red light to new suppliers, who might switch to clients that pay the same rates but offer prompt payment.

technology advantage
Source: Shutterstock

Paper-Based Invoice Systems

While one might point fingers at the AP department, such as the incorrect invoice being sent by a contractor or workplace accidents, so it may be worth looking at your overall system. Your paper-centric invoice system itself may be the culprit behind your productivity lag.

Processing hard-copy documents is an inefficient manner in which to secure authorization, as it generally entails physical signature routing. In a typical organization, the higher the position, the more time needed to wait for availability. Running around the office collecting the necessary signatures takes too long in our instantaneous world—especially when there are quicker digital options on-hand.

Also, paper-based systems usually require a physical storage system. Filing cabinets are hardly the most secure piece of office hardware and eat up valuable real estate. Not to mention that even the most well-organized filing cabinet takes longer to sort through than a tight collection of digital folders. One misplaced manila file folder can set back invoice processing days, or lead to starting the process again from scratch.

To reduce problems caused by archaic paper invoice systems, consider upgrading to an invoice system with automation features. Migrating paper documentation needed in invoicing systems to a digital system can help streamline processing. It can also provide additional security services to authenticate content and prevent document loss.

Faster Payments With Automated Invoices

During the early peak of the COVID-19 pandemic, very late invoices became a sort of mini-pandemic among small businesses in the U.S.

Other regions across the world also experienced a drop in timely payments, especially in Asia and Europe. Production in many areas ground to a halt, while retail businesses shuttered their physical stores. More importantly, office closures made it physically impossible to process existing invoices further.

However, excuses won’t help small businesses recover their investments or generate a profit. A pandemic shouldn’t be an excuse to stiff suppliers from an honest day’s work.

According to the Accounts Payable Association, 23% of businesses report having suppliers refusing to work with them again due to difficulties in collecting payment.

Invoice automation allows companies to continue processing even in the absence of paper documentation. Before, invoicing entailed a host of activities that required a lot of back and forth between parties. This consumes time and effort for all concerned. Expediting the process of receiving, verifying, and processing invoices and then making the corresponding payment can aid many businesses.

Transferring from a paper to a cloud system also means fewer manual processes, which in turn translates to faster processing and on-time payments. By extension, this results in satisfied suppliers and enhanced business relationships.

Save Money With Invoice Automation

Even when done properly, invoicing costs money. So imagine the costs of invoicing when done inefficiently. According to the American Productivity and Quality Center, the average cost of invoicing ranges anywhere from $2.07 to $10 per invoice processed. The biggest determinant on where in that range one falls? Efficiency.

But how does one make an invoice system more efficient? While more experienced Accounts Payable workers may be able to churn more invoices a day, they’re not in control of the whole situation. Routing paper to and from various departments for verification and signatures can increase the chances of lost or misplaced documents. With paper documents, you’ll need authorizing officers to receive papers in person, which can be difficult when someone goes on vacation or works from home.

To help increase efficiency, why not try paperless invoicing? Electronic documents travel much faster and farther than those following paper routes. Accordingly, the whole invoicing process becomes faster. And since documents are digital, you can ensure they won’t get lost in the process, and are more secure in transit. These features streamline the invoicing process.

Use E-Statements to Protect Data from Intrusion and Gain a Technology Advantage

Skeptics of paperless invoicing often point to the chances of documents falling into the wrong hands as a reason against converting. Or, they fear digital manipulation from unscrupulous individuals going undetected.

However, e-documents actually offer a more secure way to process and issue payments.

In reality, paper checks are the single largest source of payment fraud. According to an Association of Financial Professionals survey, 75% of companies that reported payment fraud pointed to checks as the medium used to commit the crime.

Another key reason for the delays in processing invoices is manual processes that are susceptible to human error. Stressed, tired, or distracted workers can inadvertently make a mistake. Even a slip such as an incorrect date or a transposed number can nullify the work and start the process over.

technology advantage
Source: Shutterstock

Paperless Invoicing Can Solve These Problems as a Technology Advantage

Paperless invoicing can help correct both of these issues. Automation of your Accounts Payable division removes the need for tedious, error-prone manual entries. Instead, automated invoice software can perform tasks faster and more efficiently.

In addition, automation can also help avoid check fraud. Instead of paper checks, electronic payments route through encrypted, paperless systems. Many automated services utilize security measures such as multi-factor authentication to detect fraudulent or duplicate efforts.

NatPay Solutions Help You Customize Your Document Management Needs to Increase Your Technology Advantage

When considering how to upgrade your invoice system, choose the automation route.

NatPay's Doculivery online document management service offers a modern way to process invoices. Doculivery features cloud-based access, which allows for around-the-clock electronic document routing—anytime, anywhere. Its robust system can accommodate not just invoicing, but also e-statements, online bills, electronic payroll stubs, tax forms, automated forms, and more.

Learn more about how digital invoicing can help increase your efficiency and lower costs at the same time—reach out to NatPay today!

Technology Advantage: Ease of Use with Single Sign-On (and 2-Factor Authentication)

technology advantage

Online transaction security is a must for today's businesses to gain a technology advantage. Learn how single sign-on and 2FA can keep your business safe.

We all know what a hassle juggling multiple passwords can be. Today, when users have to remember sign-in information for every little thing, it seems, it’s too easy to forget or mix up credentials. Or worse, those with password fatigue end up just using the same credentials across platforms, making them even less protected—and passwords are hardly the safest form of credential these days. Thankfully, thanks to newer technology, we have measures like single sign-on (SSO) and 2-factor authentication (2FA) to manage log-in issues nowadays.

Single sign-on (SSO) provides users the means to log in once using a single set of credentials. This one-time log-in unlocks the entire environment for the user, including access to apps, websites, and other data within the system.

Meanwhile, 2-factor authentication offers additional layers of security by requiring more than just a password for proof of entry. The process requires two different forms of authentication—usually something knowledge-based, like a password, and then something possession-based, like an outside device. The most common iteration of 2FA is messaging an additional security code to one’s phone. Without that device, unauthorized users won’t have all the credentials needed for entry.

Typical enterprise systems are comprised of hundreds (if not thousands) of different apps and tools. Imagine having to manage passwords for each app for each employee. In a large corporation, your employee base could easily number in the thousands! Instead, single sign-on and 2-factor authentication can enhance security for accounts and protect digital financial transactions better.

SSO for Easier Password Management

For many users, password management is a bit of a catch-22.

If you use a weak password, hackers can find it easy to hack. However, once you use a complicated password, it becomes harder for you to remember. If you write the password down, you’re opening yourself to even greater chances of getting hacked. The more apps that require individual log-ins, the more confusing the situation—plus, there are systems that require constant re-logs at regular intervals. These can be quite frustrating, especially when working on a deadline.

Single sign-on systems help declutter work. Users only need to log in to the main application once in a sitting. This automatically authorizes access across all apps and other information that usually requires individual log-ins.

In addition, an SSO system offers the following advantages:

  • Consolidates control over system resources
  • Helps users avoid password fatigue while increasing better password awareness
  • Reduces calls to IT help desks regarding password problems or requests for password resets
  • Increases productivity and security due to reduced need for users to log in or continually re-enter passwords
technology advantage
Source: Shutterstock

SSO Improves the Security of ACH Transactions

Requiring separate accounts and passwords for individual apps might be a good idea on paper; however, many users will forego using different passwords in fear of forgetting them. This defeats the purpose of multiple logins. Unfortunately, in this case, user convenience means bigger vulnerabilities for the enterprise. Once hackers succeed in unlocking one account, they get instant access to the other accounts with the same password.

However, the circumstances change with SSO. With only a single login credential necessary, users now only need to memorize one password. Consequently, they can come up with more elaborate passwords, which are harder to crack. These practices can help mitigate the risk of stolen accounts.

Additionally, SSO reduces the instances of separate logins. This, in turn, reduces opportunities for hackers to break into the system. As a result, financial transactions such as those using ACH systems can remain secure even with a single login. In addition, SSO helps with compliance with regulatory requirements on documentation. Single sign-on centralizes activities, which makes for a clearer audit trail.

SSO Allows Seamless Access to Applications

Having a single sign-on login that grants access to the entire enterprise system also improves productivity. Multiple logins can add up to a significant amount of time spent accessing a system. This helps users avoid technology failure, where the frustration from repeated attempts to log in or register leads some to abandon the entire process.

The secure sign-on system also prevents password fatigue. If you’re dealing with a single login, changing passwords regularly shouldn’t be a problem. However, when dealing with a dozen or more accounts, good luck assigning a dozen or more new passwords every month.

2-Factor Authentication Strengthens SSO

Adding 2-factor authentication to an SSO system further strengthens security measures for digital financial transactions. Requiring a secondary device to provide a second code can help ensure that the registered user is actually the one logging in.

It’s not uncommon for unscrupulous individuals to steal passwords from careless users or through sophisticated hacking efforts. Two-factor authentication adds an extra layer of protection by requesting additional information from a secondary device. As such, this makes any hacker’s possession of usernames and passwords irrelevant.

technology advantage for security
Source: Shutterstock

Security is NatPay’s Number One Priority, With Single Sign-On and 2-Factor Authentication

NatPay, a leading provider of ACH and document distribution systems since 1991, offers third-party payment solutions that emphasize security. With over 228,000 satisfied ACH clients which total more than $115 billion in transactions, NatPay takes security seriously. Single sign-on and 2-factor authentication are just two facets of a multi-tiered approach ensuring that transactions remain fast, accurate, and secure.

Learn more about how NatPay can provide your company with payroll, HR, and financial solutions that suit your unique requirements—contact a representative today.

ACH Payment Services: What are the Security Advantages & Disadvantages?

ACH Payment Services: What are the Security Advantages & Disadvantages?

Online security is important to businesses and consumers when it comes to their digital payments. Learn what to look for in an ACH payment service provider.

The top reason financial institutions and retailers have embraced using an ACH payment provider is the level of security offered.

In 2020, more than 26 billion payments were made on the Automated Clearing House (ACH) Network, according to the NACHA (National Automated Clearing House Association), the organization that governs the ACH Network. That’s an increase of 8.2% from 2019 alone with a 10.8% increase in the value of total payments. In total, nearly $62 trillion worth of payments were made using an ACH payment provider and 2 billion new payments were made.

That’s a significant amount of funds being exchanged electronically, and protecting businesses' and consumers' digital payments is important to all involved.

In this blog post, you will learn about the security advantages and disadvantages of using an ACH payment provider, and what to look for in using one.

ach payment provider

Security Advantages of an ACH Payment Provider

Paper checks are the highest threat when it comes to online fraud. Checks contain bank routing numbers, account numbers, and identifying information such as name, address, and telephone number.

During processing, paper checks get handled by several people from postal carriers to business receptionists, clerks, and processors. They can get lost or misplaced or fall into the hands of unknown entities.

An electronic ACH payment is simply more secure.

Businesses can also implement additional security measures to make ACH payment security even better by using a third-party provider that ascribes to secure payment methods similar to what’s used by the US Customs and Border Protection.

  • Information about users is not stored online. A unique Payer Unit Number (PUN) is used to process ACH transactions.
  • Only the original filer can transmit payment authorization.
  • A broker can only use the PUN for specific statements.
  • Fund transfer cannot begin until authorized by the user.
  • Payments are only authorized when the user’s statements match statements.

The best third-party ACH payment processes will end-to-end encryption using a locked algorithm. This prevents anyone from being able to use any information that is intercepted during transmission. Even if an unauthorized user gained access during transmission—such as a hacker doing a Man-in-the-Middle attack—the data would be undecipherable.

ACH Fraud Protection

ACH Debit is safer than checks and safer than using a debit card. Errors in payments can be reversed and consumers are protected against fraud by federal law.

Recipients of the funds transferred by ACH typically need a US bank account. This means they have to prove their identity which provides another layer of fraud protection. In case of fraud or illegal activity, it makes it much easier for law enforcement to track down criminals.

Fewer Errors

Businesses also see fewer errors when ACH payments are used. There’s no rekeying information or transferring data from one system to another.

An ACH payment doesn’t get misplaced in the accounting department or lost on the way to depositing them at your financial institution. When the physical handling of checks decreases, so does the error rate and the opportunity for fraudulent activities.

It also saves you time since you don’t need to do bank runs for deposits.

Risks of an ACH Payment

There are some risks involved in ACH payments that you should be aware of.

Credit and Debit Risk

If the person paying the bill does not have the funds available to make the payment, the ACH payment will not go through. The financial providers facilitating the ACH transaction have the biggest risk in this case.

Debit risks can occur when thieves get account details and make unauthorized debits from a customer’s account. Both customers and financial institutions can suffer losses, although many banks will cover losses within limits.

Operational Risk

Computer failures, power failures, or natural disasters do occur on occasion. This can lead to data loss, duplication, or alteration if the proper safeguards have not been put in place.

Fraud Risk

There is a risk of fraud from inside threat actors. For example, if a bank employee has access to customer account data and ACH payment facilities and makes unauthorized transactions. There is also the risk of cybercriminals breaching security at financial institutions.

Systemic Risk

There can also be a systematic risk, especially when high dollar or high-volume transactions are involved. When one customer does not have the money available to settle an account, this can cause a chain reaction. The recipient may be unable to settle their account, and so on. The systemic risk is similar to that caused by a bounced check for a large amount.

Bankruptcies and financial difficulties are typically the culprits when this occurs.

Safeguarding Against ACH Payment Fraud

The choice of an ACH service provider is an important decision in your ACH fraud prevention strategy. Whether you are handling consumer transactions, electronic billing, click-to-pay, or payroll and direct deposit services—your ACH service provider should follow these guidelines to mitigate risk.

  • ACH payment providers should be SSAE 18 Type 1 or Type 2 examined, which include annual audits from an accredited CPA firm to verify control policies and procedures are being followed.
  • All employees at ACH providers should pass background checks before being hired.
  • ACH payment providers should carry a minimum of $2 million of liability and malfeasance insurance, although the best ACH providers will carry $5 million.
  • The best ACH payment providers will have robust disaster recovery and business continuity plans to avoid shutdowns.
  • ACH payment providers should avoid processing high-risk transactions from any customers.
  • ACH payment providers should under yearly financial audits and pass financial stress tests.

Unfortunately, not all ACH payment providers will take all of these steps. Complying with these stringent self-imposed rules along with industry regulations cuts into a provider’s profitability. However, they are essential for fraud protection and to ensure you get the safe, quality service your need to run your business.

Secure ACH Payment Services With NatPay

NatPay is the nation’s largest third-party processor of ACH payments. Handling more than $115 billion annually for more than 228,000 nationwide ACH payment clients, NatPay provides unmatched value and peace of mind for its customers with a broad range of ACH payment services.

NatPay is fully compliant with all NACHA rules, regulations, and best practices which means you get the best possible service and security for fraud protection.

Contact NatPay today for more information.

Keeping You in the Clear with ACH Payments: What is the ACH Network?

Keeping You in the Clear with ACH Payments: What is the ACH Network?

Learn about the benefits of using ACH payments for business owners, and how the Automated Clearing House (ACH) network fits in.

The Automated Clearing House (ACH) network is a payment system that drives safe, smart, and fast direct deposits and direct payments with the capability to reach all US bank and credit union accounts.

Acting as a financial hub, the ACH Network represents more than 10,000 financial institutions and helps people and organizations move money from one bank account to another.

The ACH Network processed 27 billion payments in 2020, signaling five consecutive years of adding over 1 billion new ACH payments to the increasingly popular American electronic funds transfer system.

From transactions as varied as direct deposit ACH salary payments, Social Security, utilities, mortgages, charitable donations, subscription services, person-to-person, and business-to-business payments—the ACH Network processed transactions close to $62 trillion in 2020.

In this article, we discuss the benefits of using ACH payments for business owners, and how the Automated Clearing House (ACH) network fits in.

ach payments

What is ACH?

The National Automated Clearing House Association (NACHA) governs the ACH Network that facilitates electronic transfers through a broad network of financial institutions and professionals. It processes electronic financial transactions for businesses and consumers, as well as federal, state, and local governments.

The network consists of a number of financial institutions, such as banks and fintech companies, that collaborate to ensure fast, efficient, and secure payments. The ACH Network batches financial transactions together and processes them at specific intervals throughout the day, making online transactions extremely fast and easy.

NACHA rules state that average ACH debit transactions settle within one business day, and average ACH credit transactions settle within one to two business days. Changes to NACHA's operating rules, which came into effect on March 19, 2021, expanded access to same-day ACH transactions which allow for same-day settlement of most, if not all, ACH business.

Types of ACH Transfers

Electronic funds can either be transferred through ACH debit or credit.

These transfers are distinguished by how the funds get transferred between accounts. ACH debits are withdrawn from accounts (think of funds transferred from the customer’s bank account into the merchant's account) and ACH credits are deposited into accounts (transferring funds from the merchant’s bank account into the customer’s account).

Direct deposit and direct payment are popular types of electronic payments made through ACH, simplifying these processes for many businesses and organizations.‘How is ACH different from the use of credit cards? you may be asking. There are a few differences, but mainly in the authorization process and the batch payment system.

ACH transactions require authorization to allow electronic access to a particular account. Once the person requiring the funds gets authorization, they have permission to electronically access funds from another’s bank account. Credit cards don’t require such authorization.

As for the way in which money is transferred, ACH makes payments in batches, which saves both time and money. Due to various credit processes, credit card payments can’t be lumped together like ACH payments, giving ACH the competitive edge in this arena.

Many Americans are benefitting from ACH payments every day—be it the worker who has their salary deposited straight into their account, or the homeowner who settles utility bills without the hassle of having to write a check.

ach payments

How the ACH Network Works

The ACH operates through a number of key players. These players consist of: An Originator, an ODFI (originator depository financial institution), an ACH Operator, a Receiving Deposits Financial Institution, and a Receiver.

Let’s take a look at the function of each entity:

The Originator

Whether a company, government agency, or individual, the originator is the entity that sets everything in motion by initiating the ACH transaction.

The ODFI

This is the Originating Depository Financial Institution. Upon receiving payment instructions from the Originator, the ODFI commences with the ACH transaction.

The ACH Operator

ACH Operators act as clearing facilities for the above-mentioned financial institutions or ODFIs. There are two main bodies that operate within the ACH network: The Federal Reserve and the electronic payment network.

The RDFI

This key player–the Receiving Depository Financial Institution – is the entity that receives entries directly from their ACH Operator and ensures that the funds are made available to the receiver.

The Receiver

As the name implies, the Receiver is the entity in the ACH system, which receives an ACH transaction and has given the originator the go-ahead to initiate the entry into the ACH network.

Advantages of the ACH Network

There are a growing number of entities that are realizing the benefits of this fast, efficient, and safe payment system. The use of the ACH network to facilitate electronic transfers of money has also increased the efficiency of government and business transactions. More recently, the ACH system has also made it easier and cheaper for individuals to send money to each other directly from their bank accounts by direct deposit transfer or e-check.

Because they’re electronic, ACH payments use fewer resources than traditional paper checks. It eliminates the need for paper, time, and labor to handle and deposit checks. Electronic transactions also facilitate easier tracking of income and expenses. With an electronic record created for every transaction, that transaction history can also be easily accessed.

Many business owners are turning to ACH due to the affordable transaction fees. Compared with credit card companies which charge 2-3% of the transaction amount, ACH is much cheaper, having a flat fee of $0.25-0.50 per transaction. When you’re operating on a larger scale, this can really add up in terms of savings.

Application Program Interfaces (APIs) have been created for the ACH financial system, providing a way to communicate between programs. This is especially useful for companies with ERP systems and CMRs. ACH provides a cost and time-efficient way for companies to pay salaries–especially big firms that have large staff compliments.

Streamline and Save With ACH Distribution of Payments, Deposits & Reimbursements

NatPay is the nation's largest 3rd party ACH processor and processes more than $115+ billion annually for 228,000+ ACH clients, nationwide.

NatPay offers a comprehensive portfolio of payroll, human resources, and financial solutions with services that help clients do what they do best–run their business. With customized SaaS solutions and online document management services, NatPay relieves you from administrative hassles so you can focus on streamlining your business and boosting your profits.

With over 30 years of information distribution experience, providing online document solutions to over 30,000 clients across the nation, we know the ins and outs of ACH and are happy to assist you with any questions you may have.

Book a free online demo with NatPay today to find out how we can help your organization grow.

ACH Fraud: Awareness, Prevention, and Solutions

ach fraud

Transitioning to digitized payment processes? Learn what you need to know about ACH fraud and how to prevent it.

Automated clearing house (ACH) transactions make payment processing easier than ever before. An entirely digital, nearly instantaneous transfer system, the ACH network has become popular for all sorts of business transactions, including payroll, direct deposit, and consumer billing. It makes online payments easier, more seamless, and more secure. However, despite the ACH network’s many positive features, it also stands at risk of digital fraud attempts.

The U.S. Federal Trade Commission received over 2.1 million reports of fraud in 2020 alone, the most common being digital imposter scams. Organizations of all sizes and across all industries are susceptible to such attacks. Therefore, awareness of how such attacks function and how to prevent them is crucial.

While ACH fraud is rare, it can still happen if your organization does not have the necessary security protocols in place—and when it does happen, the damages are felt severely. Knowing how to identify potential ACH fraud is key to mitigating risk. This will also help you protect your company’s data and resources.

ach payments automated clearing house
Source: Shutterstock

How to Identify Possible ACH Fraud

The ACH system is almost totally automated, which makes it difficult to defraud. However, ACH fraud can still occur when unauthorized third parties facilitate a transaction, or when authorized actors voluntarily give information to external parties. There is no perfect security system, and cybercriminals commit ACH fraud by exploiting vulnerabilities. Two of the most common methods for ACH fraud are phishing emails and ACH check kiting.

A phishing email is a type of cyberattack that masquerades as an email from legitimate organizations. These scam emails typically include an undefined link in the email body—when the recipient clicks on it, the email directs them to another site that steals their data. Phishing emails are easy to send en masse to an entire organization, so it is crucial that your staff are well-aware of the best practices in email safety.

ACH check kiting, another popular fraud strategy occurs when someone issues a check without the funds to cover it. Since checks take some time to clear, perpetrators can use this window to withdraw funds before the bank realizes that there is an issue.

These particular instances of ACH fraud are among the easiest to spot, but there are more subtle strategies to watch for. Some other methods for carrying out ACH fraud include insider threats (when an authorized individual gives credentials to unauthorized parties to access sensitive information) and ACH lapping (when a payment is diverted but marked as successful anyway).

Awareness of ACH fraud methods is key to prevention. After all, you can’t prevent fraud if you don't know what it looks like! It’s also critical for your organization to implement robust security protocols to keep your data well-protected.

Set Up ACH Blocks and Filters

The best way to prevent ACH fraud is to keep tight control of your transactions. Implementing blocks and filters allow you to manage your payments effectively and efficiently, so no transaction goes through without your authorization. Pairing with a third-party processor who already operates in this manner can save you the stress of managing all your payments yourself.

For example, NatPay’s Direct Deposit Plus ACH Solutions boosts your transactions’ safety with constant NACHA compliance, so you can be sure your payments are always as secure as possible. Automated alerts for every transaction allow you to keep informed without scouring for fraud yourself. These protective measures give your organization an extra layer of security, so all your transactions flow smoothly and seamlessly.

ach fraud
Source: Pexels

Utilize Two-Factor Authentication Security to Prevent ACH Fraud

Two-factor authentication (2FA) is another security measure that can protect your organization from ACH fraud. Often implemented for email and social media accounts and other repositories of personal information, 2FA neutralizes the threat of hacking by decentralizing the access point.

As the name implies, 2FA requires confirmation from two different sources before a user can access an account. Consider, for example, how many social media accounts will require a password, and then text an authentication PIN to your mobile phone. This two-pronged verification strategy makes fraud less likely. It’s much more difficult for a hacker to access two independent devices at exactly the same time. If your main password is compromised, the backup authentication keeps your data protected.

It is worth noting, however, that two-factor authentication scams can still happen. It is critical that users remember to never share their authentication codes with other individuals.

ACH Payments Offer Maximum Security—Use NatPay Solutions Today

Compared to traditional modes of payment like checks and cash, ACH transactions present the next level of payment security. Especially in this post-Covid hyper-digital age, it helps to implement as many robust electronic options as possible. The fully-digitized ACH model limits the possibility of human error and the enhanced security scales back on fraud possibilities.

While ACH fraud is rare compared to more traditional payment methods, it can still strike. Keeping aware of different ACH fraud strategies and how to combat them—and educating your staff as well—are key to keeping your organization secure. Ensure that your ACH filters and blocks are up and running, and set authorization protocols at both individual and company levels for maximum security. Better yet, partner with a third-party payment processor who keeps on top of these concerns already, like NatPay.

A leader in secure payment processing since 1991, NatPay’s payment solutions are sure to keep your information safe. From ACH payment processing, to secure document delivery and invoicing, NatPay can simplify and safeguard all your business financial transactions.

Incorporate NatPay Secure Solutions into your organization to protect your business from cyberattacks and fraud: reach out today!


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