Over the last 5 years, Melio built a stellar reputation by making payments accessible and affordable for small businesses. Their unlimited, free ACH transfers was revolutionary at the time and set a standard for the industry. Their well-designed software was easy to use, integrated well with Quickbooks, and purpose built for small businesses.

It’s not surprise that Melio quickly built up a massive fan base in industries like Food and Beverage and became the trusted go-to for many small businesses. Since then, it’s helped tens of thousands of businesses move off of checks and bring their customer and vendor payments online.

But, all this is changing.

On September 23, 2024, Melio announced a new pricing model. This new pricing model introduced multiple Premium Subscription tiers and severely rolled back the functionality of its free tier. This has left many businesses hurt and wondering if they should stay with Melio.

Melio’s new pricing tiers explain

The biggest and most controversial change is that ACH Payments will no longer be free or unlimited. Instead, the number of free ACH payments will be limited to a monthly cap and put behind a pay wall. The specific restrictions depend on your individual plan:

• Free Plan: limited to just 5 free ACH payments per month
• Core Plan ($25 / month): 20 free ACH payments per month
• Boost Plan ($55 / month): 50 free ACH transfers per month

For most businesses, 5 or even 20 ACH payments a month is simply not enough. When businesses exceed this limit, they must pay an additional fee for each ACH payment. This ranges between 50 cents when paying a vendor to 0.5% when receiving a customer payment.

Other major changes you should know:

• Price of same day ACH is increased to 1% of transaction
• Sync with Quickbooks or Xero is limited to a mere 10 records on the Free Plan
• ACH settlement speed has been increased to 3 days for Free and Core Plans
• A/P Approvals Workflow is no longer available on Free Plan

The added cost to businesses

Under these new plans, most businesses can expect to pay significantly more to process payments on Melio. Many business owners we’ve spoken too are frustrated by these unexpected changes and unsure of the added cost it will bring to their business. So let’s take a closer look with a real world example.

Imagine a Ray’s Beverages, boutique beverage wholesaler with $5M in annual receivables and $4M in annual vendor payables. Ray’s Boutique is a B2B business and handles all of its transactions via ACH, with an average payment size of $1,000.

Before Melio’s pricing change, the cost of paying vendors and accepting customer payments is essentially $0. Now, they can expect to pay a whopping $8,010 a year more.

‍Here’s the math and breakdown:

In short, business can expect to pay a few thousand upwards of tens of thousands of dollars a year going forward. So it’s no surprise that these new plans have pushed many business owners to re-evaluate their relationship with Melio and looking for better alternatives.

The Search for Alternatives: What Businesses Are Really Looking For

This pricing change has small businesses rethinking their entire payments process. It's not just about the price—it’s about the trust Melio built and then broke. So now, businesses are looking for alternatives that offer the same simplicity Melio once promised, but with better value. We've spoken with hundreds of businesses and here's what they're prioritizing:

1. Unlimited Free ACH Transfers: This is non-negotiable. Small businesses need to manage payments without worrying about hitting limits. When they signed up for Melio, they expected this to stay free. Now, they’re looking for other platform that are delivering on that promise.
2. Simplicity and Transparency: Small businesses don’t want complicated pricing plans that require pulling out a spreadsheet. They want the same ease of use they’ve always had, without restrictions, hidden fees or unnecessary upgrades.
3. Better Support: Many users have found Melio’s customer service lacking, especially after the pricing changes. They need a provider that offers real, responsive support when things go wrong—like in the case of chargebacks and ACH returns.

What is Nickel?

Nickel is the only payment solution on the market that offers truly unlimited free ACH payments with no hidden fees, minimums or subscription. Like Melio, businesses can pay vendors, accept customer payments and automate their financial workflows in one place. Nickel is purpose-built for small businesses and provides real human support to answer your toughest payment questions. Set up a call with our team to learn more.