By Sauni Rinehart
It’s Monday morning and you or someone on your staff sits at a desk surrounded by checks — Sunday’s collection. Beginning a sometimes tedious process, you enter each gift into a program. Hours later, that week’s contributions are compiled and ready to deposit at your financial institution, which requires that you drive to your local branch with that deposit. Now it’s Thursday and it’s time to process your staff’s payroll, another time-consuming process. And when you are done with payroll, you also have bills and reimbursements to process.
All of these transactions cost time and other resources to complete. There are ways to add value to these mundane processes. One is to use Automated Clearing House (ACH), which can simplify accounting procedures and reduce expenses, thus freeing up your time and effort to focus on the ministry God has called your church to do.
“Using electronic payments to collect donations and to pay employees is the simple, safe and smart solution,” says Diane Freeman, 2007 chairman of The Electronics Payment Association’s (NACHA) Marketing Management Group and FedACH product manager at the Federal Reserve Bank of Atlanta, GA.
In the past, only medium or large churches and ministries used ACH, but if you process donations, bills, reimbursements, or payroll — as all churches do — ACH can simplify your processes. ACH is an electronic transaction that facilitates the collection or disbursement of funds in an efficient, reliable and secure manner. ACH payments include the following kinds of transactions:
- Direct deposit of payroll to your staff’s accounts
- Electronic transfer of payments from donor checking and savings accounts directly to your ministry’s account
- Direct debit from your account to pay bills
- Electronic concentration or disbursement of funds between various accounts
- Electronic reimbursement of funds you owe to staff and volunteers.
ACH has been around for many years, and everyone is familiar with the transactions. With ACH you can simplify or eliminate many of the manual processes used for processing funds. Before selecting the methods you will accept, thoroughly research all of your options. Select options that make the most sense for your ministry; when necessary, consult with a professional.
An ACH-secured payment program is safe for several reasons. Most importantly, it ensures the integrity and security of your account by greatly reducing the risk of errors and of lost, stolen, or forged checks.
Your church must have strong internal controls in place, and most ACH processing programs help in this area by requiring that more than one person be involved in the approval of transactions. Your financial institution should also provide secure delivery channels for transferring files, as well as a way to verify that the amount and number of items in the file they received match what you transmitted to them.
In addition, your financial institution should have an Accredited ACH Professional (AAP) on staff that understands the rules and regulations of ACH and can help you build a strategy tailored for your ministry.
With ACH processing you limit the risk of that run to the bank. Any time a staff member has to transport significant numbers of checks, there is a possibility of harm or loss.
By using ACH, you provide an additional method for people to donate funds to your ministry in a convenient way. “Signing up congregants for monthly donations via direct payment (electronic, automatic withdrawals from their checking accounts) will give your church a more reliable, accurate forecast for monthly income. And converting your payroll to direct deposit will give staff members more time to work on other projects,” says Freeman.
Even if you choose not to set up your own ACH origination but instead use a payroll service, as many churches and ministries do, that service can provide direct deposits of payroll for your employees.
More and more ministries are discovering the benefits of using an ACH program; for additional information about ACH go to electronicpayments.org.
Sauni Rinehart supports the public relations effort for Evangelical Christian Credit Union, Brea, CA. [eccu.org]