May is Electronic Payment Month!

by Erin McCune on April 15, 2006

in Payments News

NACHA Press Release
April 12, 2006

HERNDON, Va. – April 12, 2006 – This May, banks, credit unions, non-profit associations, businesses, and governments across the nation will once again be asking consumers to increase their use of Direct Deposit and Direct Payment in place of paper checks. An industry group led by NACHA, Electronic Payments Network (EPN) and the Federal Reserve Banks, is sponsoring the month and encouraging financial institutions and businesses to actively promote these services to their customers and employees.

A recent study sponsored by NACHA (The Response Center 2005) shows that large companies are much more likely to use Direct Deposit than small (2-49 employees) and medium (50-499) size businesses. Although 75 percent of small businesses surveyed were aware of Direct Deposit, only 26 percent used the service to pay their employees.

Of small business owners, 42 percent that don't use Direct Deposit said they thought the service was designated for larger companies. However, a 2003 survey by Tinucci showed that even small businesses can save more than $5,000 per year by switching employees to Direct Deposit for paychecks.

"This survey points to a real opportunity for us in the electronic payments business to reach out and engage small and medium size businesses to increase their understanding and use of Automated Clearing House (ACH) payments," said Mark Tizzard, Vice President of Strategic Migration, Wachovia Bank, and 2006 Chairman of NACHA's Marketing Management Group**. "As we continue our consumer advertising campaign, we also need to strengthen our industry messages that the ACH network is for all businesses, not just large corporations. The cost and time savings of Direct Deposit and Direct Payment could prove especially helpful to organizations looking to trim budgets and when time is at a premium."

Businesses and financial institutions can visit for ideas about how to inform, educate and market to their audiences about Direct Deposit and Direct Payment. These ideas include special sign-up events, advertising, media campaigns and direct mail. Resource materials are available that will help convince any size business about the convenience and time and money saving advantages of these services.


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