Direct deposit · Billing

Small biz Direct Deposit options for paying contractors & bills?

Valerie Lanard Senior Software Engineering Manager at Salesforce

March 31st, 2014

I'm interested in what kind of options there are to pay some of my bills as direct deposit for the recipient. 

I do not need a full payroll service at this point (as these are not long-term employees, and the manual overhead of managing payments & taxes is still quite small) so paying $30+/month simply for the ability to send an electronic payment to a bank account rather than a printed check is overkill.

Not sure if any accounting software or startup service offers a pay-per-use style direct deposit feature? Maybe even Paypal or one of the newer billing apps has such an feature?  

Any FounderDating advice would be greatly appreciated, as it has been on numerous similar subjects before! 


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Taylor Dondich Vice President of Engineering at MaxCDN

March 31st, 2014

I use Wells Fargo for my domestic contractors.  Doing Bill Pay directly into their bank accounts is simple.

Doing PayPal for international contractors is fantastic.  They'll take care of the tax paperwork and get you involved when needed.

Depending on the number of contractors you use, this may be the easiest.

For bills, I just have it setup for automatic payment through my bank card.

John Arroyo Delivering ecommerce and cloud applications, CEO of Arroyo Labs

April 1st, 2014

also keep in mind that you will need to generate 1099s at the end of the year, so the small monthly fee does have an added benefit of creating these for you.  If you already use quickbooks online it has the features you need too, but some may be add ons.

Zen payroll is great, it's what we use.  We paid a lot more when we used paychex last year.  https://zenpayroll.com/ 
Zen Payroll also give you two months free right now.

Anthony Zeoli Digital Strategy and WordPress Consultant and Trainer

March 31st, 2014

You're going to be hard pressed to find a free service. Wells Fargo, my business bank, has a direct pay service that's I believe a few dollars a month. Best regards, Tony Zeoli - sent from my iPhone

Alasdair Clements Co-Founder, GoCAR GPS-Guided Tours

March 31st, 2014

Bill.com allows you to do that using ACH Your bank may already have e-Bill pay feature that may be free too. I know Wells Fargo offer it as free product for certain account types or if you keep min balance of $5K

Valerie Lanard Senior Software Engineering Manager at Salesforce

March 31st, 2014

Here's where things currently stand in my research and frankly there is no good solution, so it seems:



USBank offers Single Point Essentials with ACH direct deposit features, for $27.95/mo + .35/transaction.

WellsFargo has Direct Pay for $10/mo plus .50/transaction for direct deposit to non-WF accounts; but this is *on top of * $6/mo for BillPay (waived if over $25K in accounts), and on top of monthly charges & minimums for the WF business checking account itself. Adds up to quite a full stack.  I already have biz checking elsewhere.

Paypal doesn't do direct deposit but can at least do an electronic transfer for free for both sender & receiver if paying via linked bank account. Requires recipient to transfer the funds manually back to their bank, with a delay in releasing funds.  Paypal also requires a small transaction fee if funding via credit card, as well as offering pricier merchant account options that still don't include direct deposit from what I can tell. 

Dwolla charges .25/transaction, doesn't use credit cards, and requires both parties to join Dwolla. The money is held by them until you transfer it to your linked bank account, just like Paypal. Given the ubiquity of paypal, don't see an advantage here....

I already charge people recurring payments via API call to Braintree. Too bad I can't similarly credit people recurring credits, given that Braintree is purely linked to credit card and folks don't give their credit card numbers out. I suppose I could hack a reverse payment form that encrypts a trusted user-entered credit card and is only used to send them money at my expense, but yah, that's not likely. :-)

Tim Kilroy Analytics - LTV - Boosting Profits - Digital Marketing

March 31st, 2014

www.zenefits.com - awesome service!

Valerie Lanard Senior Software Engineering Manager at Salesforce

March 31st, 2014

I just stumbled across Balanced, A YC graduate company that offers 2-way payments via API using the traditional credit card transaction route as well as bank-funded ACH transactions. Balanced is targeting marketplaces, so for a single payer (like me) this is not necessarily going to be worth the in-house development effort, but at least there's another option.

https://www.balancedpayments.com/payouts

Luis Avila Owner/Fullstack Architect at IdeaNerd LLC

March 31st, 2014

Ditto on using Well's Fargo. I use bill pay as well.

Valerie Lanard Senior Software Engineering Manager at Salesforce

March 31st, 2014

And some text that was apparently stripped from my previous post:

Zenefits appears to be a wrapper for ZenPayroll or Intuit Payroll, which are payroll services which cost $25 and up/month, hence more than I need/want. 

Bill.com has a $19/mo base subscription plus the per-transaction fees for payments.

Anonymous

March 31st, 2014

Dwolla allows one to easily pay people electronically for twenty-five cents.  I don't know what other small-biz services they have atop it.