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What’s in the post? Learn why some guaranteed pay by bank solutions see lower-than-average approval rates. Plus, what differentiates Aeropay’s platform to keep returns low, with a 90%+ average approval rate.
On the surface, pay by bank has very clear benefits:
But when it comes to the industry’s guaranteed pay by bank transactions, approval rates have been historically low.
In fact, the average approval rate for guaranteed pay by bank is often between 40% and 60% — which is far from optimal, particularly compared to credit card authorization rates.
This article takes a closer look at the reasons pay by bank transactions can fail.
We break down:
The biggest drawback with traditional ACH payments is that the network does not process after hours or on the weekends, meaning funds sent on a Friday may not actually be moved until the following Monday.
This also means a customer may have enough money to cover payment at the time of purchase, but could move those funds out of their account before it’s settled.
Non-guaranteed ACH can expose merchants to higher risk of returned payments.
To protect ACH payments, some providers guarantee merchants access to consumer funds, as long as the payment is approved on the provider’s end.
In theory, guaranteed pay by bank enables merchants to accept lower cost ACH payments, without the historic uncertainty and risk.
The next section explains why many of these guaranteed solutions lead to low approval rates.
Read more about Guaranteed ACH Payments.
While there’s a clear opportunity to disrupt the payments system in the U.S., there aren’t many pay by bank solutions built to optimally handle the end to end payments journey.
Very few U.S. pay by bank providers cover everything in-house;
And/or, they haven’t modernized their full suite.
Here’s why some pay by bank providers see low approval rates:
Even though pay by bank is a modern payment solution, some risk engines are not.
They can be built on outdated algorithms that make decisions (approve or decline) using few data points and without considering nuanced factors like transaction history.
This results in decisioning logic that is too rigid and restrictive during the approval process — meaning many legitimate transactions are filtered out.
When bank integrations, risk engines, and settlement processes are handled by separate providers, inefficiencies can accumulate and compound.
These handoffs are more likely to increase the risk of errors, slow down the process, and lead to a drop-off in approval rates.
Pay by bank providers prioritize connections with major banks but may neglect smaller regional financial institutions. Without that added connectivity,customers who bank with these institutions are unable to complete transactions.
Bank authentication failure directly impacts payment approval. Whenever a user can’t link their bank, the merchant is inadvertently turning away business.
One of the biggest challenges with pay by bank providers lies in their design. Their closed systems work in isolation and decisions are made merchant by merchant rather than at a network level.
In a closed system, even if a user has made multiple transactions across several merchants using the same pay by bank provider, that user is treated as a net new user when they first transact with each new merchant and historical data is not shared.
That fragmentation limits the ability of payment processors to accurately predict returns, meaning legitimate transactions may be blocked.
The alternative is a unified network that leverages data insights across multiple users and merchants for far better approval outcomes (more on this in the next section).
Many of the biggest names in pay by bank aren’t actually facilitating payments, they’re data aggregators that support bank linking and perhaps provide indicative risk scoring. But these companies are not part of the money movement nor does their fee structure align with successfully completing payments.
Data-focused companies like this are generally billing on a per API call basis (bank connection, balance checks, etc.). Fees for these calls are assessed regardless of the outcome of checkout session. Further, merchants then pay additional money movement fees with a separate provider and these fees can add up.
Many guaranteed pay by bank providers implement additional verification steps and criteria to fulfill their guarantee.
This approach filters out legitimate transactions and deters potential customers.
As we covered above, there’s no silver bullet for optimal approval rates.
To succeed, merchants need a unified product suite that’s developed specifically for pay by bank in the United States.
At Aeropay, we’ve built an end to end solution with optimal collaboration between components. Authentication, authorization, and money movement work as one, not as separate pieces.
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Here’s a closer look at what Aeropay is doing to consistently see pay by bank success rates above 90%:
Strong connections between banks are the foundation of success with pay by bank.
Many providers still rely on inefficient methods like screen scraping or third-party aggregators, which can lead to authentication failures and abandoned checkouts.
Direct connections through open banking APIs create a faster, more reliable process for consumers and merchants. They’re customizable, embeddable, and built to scale.
To further reduce friction, Aeropay focuses on connectivity with over 12,000 banks, including smaller credit unions and community banks. This helps more end users complete transactions without interruption.
To effectively balance risk and approval, Aeropay’s risk engine uses AI and machine learning to continuously adjust based on user activity across our entire network, including all merchants, multiple industries and each user’s behaviors.
The model evaluates dozens of nuanced parameters to manage more than 50 return codes, predict available funds at settlement and identify dispute patterns.
Instead of simply rejecting borderline cases, our systems intelligently approve 90%+ of transactions, driving approval rates well above industry averages while maintaining robust fraud prevention.
In the rare case a payment fails, Aeropay uses machine learning to automatically determine the best times to collect funds. Using robust financial information, Aeropay intelligently determines when to retry payment — while continuously adjusting and learning from new user behavior.
When authentication, authorization, and settlement are handled separately, errors and delays become inevitable, not to mention the additional costs needed to maintain multiple integrations.
A unified product suite removes these issues by integrating products to work together so merchants experience fewer points of failure and higher approval rates, all in a single integration.
This end to end suite of tools greatly reduces complexity, allowing transactions to flow seamlessly from start to finish.
The Aeropay network includes every onboarded user, across every merchant in our system.
When a consumer links their bank account once, their credentials and bank account are securely recognized at checkout for every other merchant on the platform.
This level of recognition accelerates onboarding and helps increase first-time payments from existing AeroNetwork users.
Plus, insights from transactions across the network enhance risk assessment and decision-making to lift approval rates.
It’s 2025, your payments should be as modern as your business.
Aeropay is a digital payments platform that connects consumer financial accounts for modern ACH payments and instant payouts. We help thousands of merchants effectively balance low processing costs with high approval rates, streamlined user onboarding, and optimal security.
Our product suite is built in-house, with a specific focus on facilitating better payments.
Core offerings include:
No matter your use case, there’s an opportunity to modernize your payment stack with pay by bank.
At Aeropay, we work with marketplaces, ecommerce sites, subscription services, billers, fintechs, and much more — they consistently maintain positive user experiences while reducing transaction fees and chargebacks.
