Payroll Funding Methods

This guide outlines four payroll funding methods available through BambooHR: Two-Day ACH, Four-Day ACH, Wire Transfers, and Reverse Wire Transfers. Each method varies in processing time and suitability based on business needs. Two-Day ACH is the most common, allowing funds to transfer within two business days, while Four-Day ACH takes up to four days and is best for semi-monthly or monthly payrolls. Customer-initiated methods, such as Wire Transfers and Reverse Wire Transfers, offer quicker funding options but may incur fees. Key differences include speed, planning requirements, and potential costs. New customers may initially be limited to Four-Day ACH or Wire Transfers, with options to switch after three months. Proper setup and coordination with BambooHR support are essential for optimal payroll processing.

Jun 4, 2026
Knowledge

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Article Text

What funding methods are available to process my payroll?

Purpose: This guide will walk you through the four funding methods available when processing payroll. Please note that certain factors may impact which funding method is available to you.

Table of Contents:

Funding Methods
Customer Initiated Funding Methods
Key Differences

Funding Methods

BambooHR offers four methods to fund your payroll:

Two-day ACH (Automated Clearing House)
Four-day ACH
Wire transfer
Reverse wire

The difference between these funding methods primarily lies in the processing time required to transfer the funds from your company's bank account to the employees' bank accounts. Here's a breakdown of each:

1. Two-Day ACH (most common):

Processing Time: On the payroll due date, the ACH network will process the transaction; funds will be debited from your company account and credited to your employee's account within two business days. For example, if the pay date lands on a Friday, with a two-day ACH funding method, you must submit payroll by Wednesday to initiate this transaction. An exception for this would be if the due date lands on a bank holiday, then you would need to submit payroll the first business day before (i.e., if a holiday lands on a Monday that payroll is due, submit payroll by the Friday before). Please note that this process will happen within two business days, and oftentimes, company banks will deliver funds to your employees before the actual expected pay date. Still, funds are guaranteed by the second day.
Use Case: This method is suitable for businesses that can plan their payroll in advance and want to ensure timely payment without incurring additional costs associated with same-day or wire processing.

If you are a new BambooHR customer or adding a new EIN you may or may not see this option available to you during your first 3 months after setting up payroll, depending on your status with BambooHR. If it is not initially available, you will have the option to choose this funding method after 3 months.

2. Four-Day ACH:

Processing Time: On the payroll due date, the ACH network will process the transaction; funds will be debited from your company account and credited to your employee's account within four business days of the payroll due date. For example, if the pay date lands on a Friday, with a four-day ACH funding method, you must submit payroll by the Monday before to initiate this transaction. Now, let's say the Monday you are supposed to approve is a bank holiday; then, you would have to submit payroll on the Friday before in order to pay employees by the following Friday. Please note that this process will happen within four business days, and oftentimes, company banks will deliver funds to your employees before the actual expected pay date. Still, funds are guaranteed by the fourth day.

Availability by pay frequency

Four-day ACH requires enough lead time to consistently complete key payroll workflows including approving time cards, approving time off requests, making deduction and/or extra pay updates. With this in mind:

Four-day ACH is not available for customers processing payroll on a weekly schedule.
- With a weekly pay schedule, four-day ACH effectively leaves only one business day to complete these workflows before payroll must be submitted, which is not sustainable.
For customers on a bi-weekly schedule, four-day ACH may be available depending on the your approval workflows and your ability to complete the workflows listed above on time.
- If a pay date falls in a week with a banking holiday, the schedule disruption can reduce available processing time by one to two business days and making it more difficult to meet deadlines.
Semi-monthly and monthly pay schedules are generally the best fit for four-day ACH.

Our ACH partner, the National Payment Corporation (NPC), will send a request to your bank to attempt to withdraw funds on the due date of the payroll for two-day and four-day ACH methods. NPC will then initially fund the payroll to ensure the employees are always paid on time. If the payroll funds are not available to fund the payroll, that payroll will result in an NSF (Not Sufficient Funds) payroll. As a result of an NSF payroll, all your tax payments will be placed on hold, and your payroll processing access will be restricted until the NSF payroll is fully funded.

3. Reverse Wire Transfers:

Processing Time: You can request to set up reverse wire transfers to fund your payroll with our ACH partner, NPC. With pre-approvals, NPC will withdraw payroll funds via wire directly from your company bank account upon your payroll approval. Reverse wire transfers are processed quickly, often on the same day, similar to standard wire transfers.
Use Case: You have the option to set up your account to always be funded via reverse wire, or you can choose a hybrid reverse/two-day ACH model. In the hybrid model, your company is set up for a normal two-day ACH, but when your pay cycle(s) for a single pay date reach the threshold that requires a wire, the system will automatically switch the pay cycle to reverse wire funding. This ensures payroll is funded quickly without the hassle of setting up a regular wire if your company reaches that threshold, which is especially helpful for those who frequently are required to wire. Please note this funding method might incur fees from your bank.

Please note there is also a $10 fee per wire associated with reverse wire transfers.

Customer Initiated Funding Methods

1. Wire Transfers

Processing Time: Wires can be completed within two days, one day, or the same day of the expected pay date. Check out this guide for further information on how wire transfers work in BambooHR and the fees associated.
Use Case: This method is often used by businesses that need to fund payroll quickly, have last-minute changes to payroll, or reach a certain threshold amount that requires the payroll to be funded through a wire. This method may also be required within your first three months of running payroll with BambooHR.

2. Real-Time Payments (RTP)

Processing Time: Instantly 24/7
Use Case: RTP is a bank-to-bank transfer that allows fund to be moved in real-time (seconds). This allows immediate payroll funding, if supported by both banks.

You will need to work with BambooHR Payroll support and your bank to verify RTP support. Please note there is also a $35 fee per wire associated with this funding method.

3. FedNow

Processing Time: Instantly 24/7
Use Case: FedNow is another instant payment option operated by the Federal Reserve. Similar to RTP, it offers instant payroll funding if supported by both banks.

You will need to work with BambooHR Payroll support and FedNow to set up this option. Please note there is also a $35 fee per wire associated with this funding method.

4. ACH Credit

Processing Time:
- Typically 1–3 business days (depends on your bank ACH processing and submission cutoffs).
- Not real-time; timing must be planned to ensure funds arrive in BambooHR’s payroll account before payroll deadlines.
Use Case:
- When your company wants to push payroll funds from your bank (customer-initiated) instead of allowing BambooHR to debit your account.
- Useful if your company requires manual control/approval of outbound payments, have debit blocks, or prefer not to share bank debit authorization.
- Setup requires coordination with Payroll support and your company bank to align transfer details and timing.

Please note there is a $35 fee per transfer if you choose to utilize the ACH Credit funding method.

Key Differences

Speed: Customer-initiated funding methods offer the flexibility of funding payroll almost instantly, as long as same-day deadlines are met. Two-day ACH is faster than four-day ACH, which allows for a shorter lead time between payroll submission and employee payment.
Planning: Two-day and four-day ACH methods are automatic upon setup, but they can shorten the amount of time you have to complete your payroll. Wire funding and other customer-initiated funding methods require more manual effort from your company and bank to initiate, but they allow for the last-minute changes necessary for an accurate payroll.
Fees: Two-day and four-day ACH do not require fees to process. However, customer-initiated funding (wires, reverse wires, etc.) may incur fees from your banking institution, although reverse wires are typically less expensive.

Please note: If it is your first time running payroll with BambooHR, you will likely be set to a four-day ACH or a wire. After 3 months, you can opt to choose a two-day ACH. Work with your Payroll Project Manager or reach out to Payroll Support to ensure the correct funding method is set up. Also, note that some parameters may require you to wire a payroll. For more information, click here.

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