We're thinking about moving our business account from Wells Fargo to a local credit union. Main worry: we have about 30 recurring ACH customers and a handful of vendors that auto-debit us. Has anyone done this without a total mess? I don't want to be explaining to customers why their payment bounced because we switched banks.
banking
Switching business banks without disrupting customer payments
I've done this twice. The key is to open the new account first, move your recurring billing there, then close the old one. Don't close the old account until all your ACH authorizations are updated. Took about 6 weeks for us.
Wait, you can just update ACH info without customers re-signing anything? I thought that was a whole thing.
For most it's just a form you send them. Some banks make you re-authorize, but we only had two customers who needed to do anything. We just emailed everyone a short note with the new account info and a one-page form.
Honestly the bigger pain was our POS system. We had to re-link everything. Took a full Saturday. Check whatever software you use for auto-billing First before you worry about the bank.
My advice: don't switch during a busy season. We did it in December and it was a nightmare. Wait until a slow month if you can.
Communication is everything. Send a heads-up to your customers 30 days out, then a reminder a week before. And make sure your old bank doesn't auto-close the account when the balance hits zero — that happened to a friend and it killed a bunch of recurring payments.
Good point. Also, some credit unions are slow on ACH setup. Ask them upfront how long it takes to enable ACH origination. We had one take 3 weeks just to approve it.
You're worrying too much. Just do it. Banks are used to this.
Appreciate the real-world examples. The bit about auto-closing the account is exactly what I was afraid of. I'll call the credit union tomorrow and ask about the ACH timeline. Still on the fence about timing but at least I have a checklist now.