Pre-Authorized Payment (ACH) 

Why should you use Direct Payment?

Direct Payment simplifies your life by taking the hassle out of paying your bills.

• Most people spend the equivalent of three days a year paying bills. Direct payment saves you that time.
• Paying bills with check can be a big hassle. For each bill, you have to write a check, address an envelope, find a stamp & remember to do it all in time to avoid late fees.  Direct Payment spares you that hassle.
• Since Direct Payments are made automatically, you don't have to be in town to pay your bills.  This is perfect if you travel on business or go on a vacation.

Direct Payment saves you money.

• According to NACHA:  The Electronic Payments Association, an average family receives 20 bills each month.  At this rate, postage alone costs each family almost $85 a year.  Checks can easily cost another $30 a year.
• Mailing a bill just a few days late may result in late fees of as much as $30 per bill.  Some families will save hundreds of dollars a year with Direct Payment.

Direct Payment is reliable, accurate, on time a confidential.

• Direct Payment is similar to Direct Deposit.  Both have been around for more that 25 years & use the same network.  In 1998, more that one billion payments were made by Direct Payment
• Each Direct Payment is deducted from your account on the due date each month so it is easy to track.  In contrast, you never know when checks are going to be deducted from your account.
• Few people see Direct Payments.  They are confidential transactions.  A check passes through many hands as it is processed.
• Direct Payments can never be lost or delayed in the mail.

Direct Payment gives you greater control over your finances & provides the record keeping you need.

• With Direct Payment, you know the exact payment date & amount well ahead of time.
• With Direct Payment, you maintain a good credit rating by paying bills on time, every time.
• With Direct Payment, you always have a record.  Each bill that is paid automatically from your bank account is listed in your monthly bank statement.
• With Direct Payment, consumers have the right to stop or reverse a payment they believe they did not authorize or is in error.
• With Direct Payment, it is easy to invest & save your money consistently.

Common Misconceptions

Myth: Signing up for Direct Payment may be difficult.
Reality: Signing up for Direct Payment is easy. Many of your billers may have already sent you information about Direct Payment with your monthly bill & included an authorization form.  All you have to do is let each of your billers know that you want to sign up.  Call them or simply complete the authorization form.

Myth: If I have a problem with a Direct Payment, it is going to be more difficult to reconcile than a check.
Reality:  Problems with Direct Payment are rare. But if any questions should arise, all you need to do is contact the biller.  The problem can usually be corrected immediately.  It the matter is not handled to your satisfaction, call your financial institution & stop payment of future Direct Payments until the problem can be corrected.

Myth:  Direct Payment will cost me money.
Reality:  One of the benefits of Direct Payment is that it will save you time & money in postage, checks & even late fees.  Some financial institutions do charge a small fee, such as 15 cents, for Direct Payment, but in most cases, it is a free service.  Ask your financial institution about its policy.

Myth:  I will not know when my payment has been taken out of my account or the amount that was taken if I use Direct Payment.
Reality:  Your funds will be taken out of your account on the payment due date that you & your biller have agreed upon.  If the date falls on a federal holiday, the money will be deducted on the next business day.  Most companies issue statements for their customers.  If the amount of the customer's payment varies each month, the company is required to send a statement.  Deductions also will appear on customer's monthly bank statements.  With payments made by check, you can never be sure when the payment will post to your account

Myth:  With Direct Payment, nothing prevents a company from accessing my account whenever it wants to.
Reality:  Federal Regulation E prevents unauthorized debits from your checking or savings account.  It also prohibits a company from taking money from your account before the date specified & requires a company to inform you 10 days before changing the amount or date of the debit