Bitcoin tipping startup ChangeTip now allows customers to buy Bitcoin via ACH without waiting for days for a bank account to be linked to the transaction. The company charges a flat rate regardless of the transaction amount. To enable the payments ChangeTip has partnered with electronic solutions provider Knox Payments, a company that has a focus on speeding up the processing of funds through ACH.
ChangeTip is a new platform that enables micropayments via social networks. It holds great promise especially in fundraising. It charges no transaction fees for micropayments. By enabling ACH, ChangeTip now offers the opportunity to a much broader audience for whom the promise offered by Bitcoin has not yet quite caught on. In partnering with a trusted ACH solutions partner, it is now possible to transact across crypto and fiat currency.
Also read: Is ChangeTip the Viral Bitcoin Killer App?
Background on ACH
ACH stands for Automated Clearing House. It is an electronic network for financial transactions in the United States. It processes large volumes of transactions in batches. It can be used for direct deposit, payroll processing, insurance premiums, mortgage loans and other kinds of payments. The online version of ACH is increasingly being used as a substitute for the traditional credit and debit card. In 2013, the ACH network processed 22 billion transactions with a total value of $38.7 trillion.
ACH is also used by Bitcoin exchanges for transactions between BTC and USD, by linking a US checking account and routing number. Transactions typically take between 2-5 days to complete. A small ACH fee is included in the transaction. Currently, ChangeTip is charging $0.18 per transaction. Unlike other players in the market, however, Knox Payments will enable instant payments.
Advantages of ACH
ACH dramatically reduces the number of people who have access to financial information held by banks and other financial institutions. It is estimated that 9 million Americans are victims of identity theft each year. As ACH is automatic and electronic the risk of identity theft is considerably reduced.
It is also cheaper to handle transactions by ACH. According to the US Office of the Comptroller of the Currency, a paper check costs five times as much to process as the same transaction done via ACH.
What do you think of this new option to buy Bitcoin? Comment below!
Images from ChangeTip and Shutterstock.