How long will a payment done via ACH Direct Debit take to reach my account?

Problem Statement

This article helps you understand how long will a payment done via ach direct debit take to reach my account.

Solution

Direct Debit via ACH takes more time when compared to other payment types to reach the bank account.

Unlike card payments where the authorization and capture of funds happen immediately, in direct debit via ACH, the entire authorization and capture process has a waiting period. This waiting period is typically up to 15 days. When customers make payments via Direct Debit, the payment is initiated. But here authorization happens only after the waiting period. It is important to understand that in the case of ACH payments, funds aren't guaranteed if a payment has been initiated. Only after the authorization of the funds (which takes up to 15 days) is the real status of the transaction known. So Chargebee waits until 7-15 days to check the status of the transaction.

Sometimes, despite the transaction being marked as settled in Authorize.Net, there are chances of an ACH return. To eliminate any confusion, Chargebee waits until 15 days before marking a transaction as Success. After 7 days, Chargebee checks in periodically with the payment gateway to see if there are any returns. If there are any returns (due to reasons such as insufficient funds), the transaction is marked as Failed in Chargebee. When the request is validated and the payment is "settled" by ACH, Chargebee changes the transaction status from In Progress to Success and the invoice will be marked as Paid. More on the behavior of invoices with respect to ACH payments, here.

Here's more on Direct Debit via ACH for a complete overview.