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How does ACH processing work, and how long does it take?
How does ACH processing work, and how long does it take?
Gnomes avatar
Written by Gnomes
Updated over a week ago

ACH payments debit directly from a client's bank account.
ACH payments take up to 3 business days to receive acknowledgment of their success or failure:

  • When created, ACH charges will have the initial status of pending.

  • A pending balance transaction will immediately be created reflecting the payment amount, less our fee.

  • During the next 1-3 business days, the payment will either transition to succeeded or failed.

  • During this time, ACH payments will be treated as if they are successful, and sent to your Stripe available balance and may be paid out to you.

  • If the payment fails, the failed ACH payment will reverse the pending balance transaction created, and it will show in your Stripe account as a refund.

  • If the payment is successful, your Client will see the payment reflected on their bank statement 1-2 days after creating the charge. (Your Client will know the payment succeeded before the bank notifies Stripe.)

Failures can happen for a number of reasons such as: insufficient funds, a bad account number, or the customer disabled debits from their bank account.

If you would prefer to wait for funds to be deposited into your bank account until the payment is deemed successful, please reach out to us, and we can make this change for you! Note that this will extend the payout timing.

The standard time for ACH payments being transferred is:

  • Billing date - ACH payment is created

  • 1-3 business days - for your client's bank to give the approval/decline

If a month has bank holidays or weekends, the dates may be extended.

The ACH payment system is through an antiquated system the banking industry uses, which is why it takes so long for them to send approvals to Stripe. The estimated dates in the Dashboard is just the time frame it'll take if the bank waits until the last second to give their approval.

Here's more on payment timelines.

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