Ensuring security with ACH transactions

Online banking has revolutionized the way businesses operate in many respects, be it in their relationships with customers or transactions with banks. These include Automated Clearing House (ACH) payments used for payroll and regular vendor transactions, electronic checking and payment processing for consumer purchases. Security has been at the forefront of concerns, as ACH cards and wire transfer have been the subjects of many fraudulent activities. Though banks and businesses have increased their security software and practices, criminals are still managing to steal money through the technology. In most cases, though, simple checking of where the money was going would have prevented major losses, as fraudulent transactions occurred in massive amounts over the course of months before the bank or business became aware of the problem. Properly managing cash flow in a virtual environment
Smart Business recently offered some tips to better manage cash flow when using online or mobile banking platforms. According to the source, businesses that choose not to use online banking are missing out on a great opportunity to improve the efficiency with which they make transactions. The news provider explains that online bill pay decreases the risk of overdue payments to vendors, lenders and more, while allowing business owners to focus on other important facets of the company's operations. Further, online banking does not cost businesses anything more than a traditional account, the source notes, while it erases the expenditure of banking-related funds regarding postage, checks and the like. Monitoring key in online banking
Smart Business recommends regularly monitoring the transactions that occur through the online banking portal. This includes payments to vendors and employees, as well as those coming from clients. Not only will this work to ensure that all payments are made on-time and in-full, it will deter the risk of fraud. One of the more recent cases of fraud that sent waves through the banking community was related to a Maine-based construction company. Over the course of one week in 2009, ACH-based fraud accounted for just under $600,000 in lost funds for the company, though the bank was able to recover about half. Still, checking the accounts on the day that automatic transactions occur will prevent a little problem from rapidly becoming larger. In this specific instance, the bank was held responsible, as it didn't provide "commercially reasonable" security.