Donna Genie explains best practices for setting up and managing recurring payments for SBA EIDL loans. Key steps: create an account on pay.gov and add ACH info specifying a 1201 payment, then use the Capital Access Financial System (CAFS) to initiate the payment and mark it recurring. She strongly recommends using a separate bank account (or sub-account) dedicated to the monthly EIDL payment, funding it via transfers (weekly suggested) so only one payment’s worth of funds is available to the government. She mentions Relay Financial as an example service for multiple accounts, explains how to change/delete drafted accounts on pay.gov, and provides contact details for follow-up.
Chapters
If you're beginning to make your payments on your Eidl loan, there are a few things you might want to take into consideration for best practices. Now, obviously these are recurring payments. You want to make sure you're on time each month. Honestly, it's pretty difficult to set up the recurring payments on their website. So I have a few tips for you. The first thing you'll need to do when you log into the Capital Access Financial System, or cafs, that's where you'll be making the payments, is you'll also need to set up an account@pay.gov without this option, you won't be able to set up the recurring payments@pay.gov you'll need to set up the ACH for the account where they should draft, and that needs to be an account 1201 payment. That's the type of loan that the Eidl falls under for government payment in that ACH information. Let's give you a few tips about what account you should use. I strongly recommend that you have a separate account set up specifically for the Eidl loan payment each month. Whether you transfer money individually or all in one lump sum into that account and then have that one account drafted, or you just put the money in there, you want to separate those funds. There's really never a good case where you want to give the SBA the ability to draft an account with an endless supply of money. Who knows, if they ever go haywire or if they think you're in default, they may attempt to draft more than their payment should be. So I like to set up a separate account specifically for this. If you're using a product like relay financial relayfi.com you can set up multiple accounts just like this for many purposes free of charge. So I strongly suggest you take a look there. But I have a separate account set up for the repayment, and then I make weekly drafts from my operating account or weekly transfers. I'm sorry, from my operating account into that so that every month there is money there to fund that payment. Then if you ever need to stop making payments, it's sometimes difficult to get the government to stop drafting an account. But if there is no money in that account, they will have to stop drafting it so you could close that account if needed. So my first advice, set up a separate account. Secondly, do set up the recurring payments. I like to set up recurring payments that I control in most cases, but I'm not confident the government would ever find my payment and get it posted correctly. So I will have them draft it, but only from an account that has the money for one payment in it. In that payment account, use the recurring option on the pay.gov site first. So set up the account that you want to draft on pay.gov then switch back over to the Capital Access financial system and make a payment like you normally would. You should then see an option to make a recurring payment. If you ever need to change accounts, you'll go back into the pay.gov side very confusing and delete the old one and then set up the new account. I actually switched an account for somebody recently and it is pretty easy to see once you log in, but again a little confusing where those options are. So a little summary. If you're going to set up recurring payments, go into pay.gov first. Set up 1201 payments and enter in your ach information for the account you'd like to draft. Then go into the Capital Access financial system, make a payment and you'll be able to tell it it is a recurring payment. So if you have any questions on that or if you have any other suggestions that you found helpful, we'd love to hear it. Please just shoot me an email or comment on this video and again, subscribe to our channel to make sure you get all of the latest and greatest on the Eidl and everything else that we offer.
Please follow us on Facebook and Instagram. Please make sure to check out our blog and our link below. Subscribe to our YouTube channel and hit the bell to be notified when we post.
