Dwolla Review: What Is Dwolla & How Does It Work?
With a Dwolla paid plan, you'll have access to a lot more bells and whistles than traditional ACH processing options offered by most merchant service providers.
Dwolla

Total Rating | 4.5 |
---|---|
Products & Services | Good |
Pricing | Good |
Sales & Advertising Transparency | Excellent |
Contract Length & Early Termination Fee | Good |
Customer Service | Good |
Reviews, Complaints, & Testimonials | Excellent |
Pros
- Offers pay-as-you-go ACH processing
- Many developer tools available
- White-label payments solution available
- Extensive customer support options for paid plans
Cons
- No credit or debit card processing
- Paid plans are very expensive
- Only available in the United States
Dwolla Overview
Dwolla is an ACH payments facilitator, although originally, Dwolla was a P2P bank transfer platform that also catered to businesses. The company has since transformed from a PayPal-like service that both merchants and consumers could use into a platform that will mostly be a good fit for very large businesses that handle a lot of B2B transactions or need some of the company’s specialized services, such as support for mass payouts.
Unlike almost every other merchant services provider we’ve reviewed, Dwolla does not offer credit or debit card processing at all. The company is not a merchant account provider or a payment service provider (PSP), such as Square.
In fact, its bank transfer-only business model is designed specifically to avoid the high interchange fees charged by the major credit card associations. Because of this, you won’t find support for things such as credit card terminals or point of sale (POS) systems. Dwolla also lacks support for the kinds of check scanners used to convert a paper check into an echeck payment.
Does Dwolla have a place in your payment processes? Read on.
Are you looking for the best or cheapest way to accept ACH bank transfers? Take a look at our post about ACH payment processing.
Table of Contents
Products & Services
What is Dwolla, and how does it work? Dwolla’s concept is surprisingly simple: ACH payments.
Dwolla Payment Processing & Money Transfer
You’re not going to find credit or debit card acceptance, cryptocurrency, PayPal, or any of the other assorted online payment alternatives that have cropped up. Just pure, simple bank transfers. So how does Dwolla handle ACH transfers? You can think of it as something akin to a digital wallet (such as Venmo or CashApp) but scaled for B2B payments rather than P2P transactions.
Here are some of the key features of Dwolla payment processing:
- ACH Payments: A Dwolla account will allow you to send, receive, and facilitate payments. If you’re wondering what “facilitate payments” means, it means you can build a platform that allows users to send funds to one another without requiring you, the merchant, to do anything. (Additional note, you can also charge a facilitator’s fee for the transaction to monetize the platform.) You can also hold balances within Dwolla, like a digital wallet.
- Recurring Payments: If there’s one good reason to take ACH payments, it’s probably to enable recurring payments. As you might expect, Dwolla supports recurring payments.
- On-Demand Payments: These types of payments also work with metered billing, charging a variable amount every month based on usage. This is ideal for utility billing, but it can also be used with any type of usage-based service.
- Bank Account Balance Checks: Unlike PIN debit payments, ACH transactions usually do not have a built-in function to confirm that there are sufficient funds in a customer’s account before attempting a withdrawal. Dwolla includes the ability to check the balance on a customer’s account before debiting funds (with their permission, of course).
Dwolla Platform Tools
If it were just about accepting ACH payments, Dwolla’s niche would be able to be filled by any payment processor that takes them (for example, compare Dwolla vs. Stripe or Dwolla vs. PayPal’s Braintree). Dwolla, however, offers a unique platform based entirely around ACH payments.
Here are some of the features:
- Dwolla User Accounts: An important requirement with Dwolla that you won’t experience with most credit card processors is the need for users to verify their accounts before they can make or receive a payment. Dwolla offers two options to do this: micro-deposits and Dwolla.js. Micro-deposits send two tiny sums (typically less than $0.10 each) to the user’s bank account to verify the account information. Dwolla.js is a client-side JavaScript library used to securely transmit bank account information from your website to Dwolla without any data passing through your server. While Dwolla.js can verify a bank account instantly, micro-deposits require several days to confirm.
- User Account Types: Dwolla separates user accounts into three tiers: Receive-Only, Unverified, and Verified. Receive-only customers are only able to receive payouts and do not require any verification process. They cannot hold balances within a Dwolla wallet. Unverified accounts can both send and receive funds but are limited to sending $5,000 per week. Unverified accounts collect just the customer’s first and last name and their email address and can only transact with verified customers or the master Dwolla account. Verified accounts may be set up for either personal or business use. A verified business account can send and receive funds with a limit of up to $10,000 per transaction, while a verified personal account can send and receive up to $5,000 per transaction. In both cases, the customer can hold a balance within a Dwolla wallet.
- Security Features: As we’ve mentioned above, Dwolla.js is the company’s primary security feature. By keeping sensitive customer bank account information from ever being recorded or stored on your server, this feature drastically reduces the scope of your PCI compliance requirements. Dwolla also uses tokenization to replace actual account numbers with single-use “tokens” that hackers cannot exploit.
- Other Integrations & Add-Ons: Dwolla currently lists a number of third-party integrations that are available to its users. One of the more useful integrations is Plaid, which provides another option for customer bank account verification. Plaid integrates directly with your website and uses tokenization to provide instant account verification. It’s also mobile-friendly. Another integration, Sift, is a fraud-prevention service that uses machine learning and a global data network to detect and proactively prevent fraudulent activity.
Dwolla Pricing
We’d previously criticized the large gulf between Dwolla’s Pay-As-You-Go and Scale plan, but the company now offers more of a gradient between $0 and $2,000 per month with the addition of two more plans. This should provide growing businesses that process a lot of transactions with more ability to scale within the Dwolla ecosystem.
Depending on the plan, Dwolla allows you to send and/or receive funds and/or move funds between users, or even between two accounts owned by the same user. Some of these transfers are traditional ACH transfers, while moving money between two Dwolla app users can bypass the automated clearinghouse and just use Dwolla’s internal infrastructure. Wire transfers and pushing payments directly to debit are also available at the higher tiers.
The available plans are as follows:
Pay-As-You-Go
- No monthly fee
- Standard ACH processing
- Balance-to-balance transfers between two users of your application
- 0.5% per transaction (minimum $0.05, maximum $5)
- One-time $1 fee per receive-only user
- One-time $2 fee per customer
- Transaction-based pricing
- API access
- Tokenization
- Branded (yours) user experience
Most small businesses will probably be happy with the Pay-As-You-Go plan, which provides basic ACH support. You can sign-up for it right from Dwolla’s website.
Launch
- $250 per month
- 0.5% per transaction (minimum $0.05, maximum $5)
- One-time $1 fee per receive-only user
- One-time $2 fee per customer
- Next- and same-day ACH processing
- Push-to-debit
- Real-time payments over the RTP Network
- Wire transfers
- Dedicated support available for $500+ per month
- All other features available in the Pay-As-You-Go plan
The Launch plan is where the full feature set of Dwolla starts to kick in, granting you the ability to process ACH payments more quickly, send payments directly to debit cards, send and receive wire payments, and utilize the RTP (Real-Time Payment) Network, a high-speed bank-to-bank alternative to ACH.
Scale
- $1,000 per month
- 20,000 – 50,000 transactions per year
- One-time $1 fee per verified customer (unverified are free)
- Dedicated support included
- All other features available with Launch plan
The Scale plan is now $1,000 cheaper per month. At this price point, your ACH transactions are now included in your monthly fee and dedicated customer support is included. The Scale plan requires an annual commitment.
Custom Plan
- $2,000 per month
- Volume pricing
- Custom feature development
- All other features available with Scale plan.
Suitable only for the largest businesses, Dwolla’s Custom plan includes all the bells and whistles that Dwolla offers. As with the Scale plan, you’ll need to enter a 12-month contract.
Sales & Advertising Transparency
As you would expect from a leading fintech company, Dwolla’s website is polished and professional.
The company discloses a lot of information about its products and services, and it provides more detailed pricing information than what you’ll get from a run-of-the-mill merchant services provider. Dwolla now offers more information than ever before on how its plans work, and what they’ll cost you. Some of the company’s terminology can be a little opaque, however, particularly when it comes to describing what’s meant by “use cases.”
We haven’t found any complaints from merchants who have encountered hidden fees or misleading sales representatives. To the best of our knowledge, the company employs an in-house sales team and doesn’t rely on independent agents.
Contract Length & Early Termination Fee
Dwolla’s Pay-As-You-Go plan doesn’t have a long-term contract, and the Terms of Service provided on the company’s website specifically state that you’re free to close your account at any time. This is a great feature for small business owners, especially if you only process an occasional ACH payment and don’t use your account regularly.
If you sign up for the Scale or Enterprise plans, however, things are different. Like almost every other industry provider, Dwolla doesn’t say a word about long-term contracts on its website. Yet we’ve found plenty of reports from merchants indicating that the company does require a long-term commitment from businesses using these plans. Agreements are typically for an initial term of twelve or 24 months.
However, there’s no information available about whether there’s also an automatic renewal clause or for how long the renewal periods will run. Nor have we heard anything regarding an early termination fee (ETF) that you’d have to pay if you closed your account before the end of your contract term.
Customer Service & Technical Support
Customer service options with Dwolla range from barely adequate to top-notch, depending on which pricing plan you sign up for. It’s an open secret in the financial world that bigger clients get better support, while smaller clients have to take what they can get. Dwolla, however, makes it official. If you’re a paying customer on either the Scale or Custom plans, you’ll get some of the best support options we’ve seen anywhere. If, however, you’re just using the Pay-As-You-Go plan and not paying Dwolla a hefty monthly account fee, you’re more or less on your own if you encounter a problem.
- Pay-As-You-Go: You have access to Dwolla’s online forums and can email the company. That’s it.
- Scale & Custom: You’ll also be assigned a dedicated account manager that will be your primary point of contact for any support issues. Many of the better merchant services providers offer this option, and we’ve found that it provides the highest level of personalized support, which includes chat and phone support. Telephone support hours aren’t listed, but you can expect that you’ll have to call during regular business hours if you want to reach someone who can help you with a problem.
Dwolla Reviews, Complaints, & Testimonials
User feedback on Dwolla from across the internet is mixed but generally positive. The company also provides some testimonials and case studies on its website that provide good examples of how users have leveraged the Dwolla platform to their benefit.
Negative Dwolla Reviews & Complaints
Dwolla is not accredited by the BBB but nonetheless has an A+ rating. The company has had four complaints over the past three years, one of which was filed within the last twelve months. There are also four reviews posted, all of them awarding either one or two stars (out of five).
Issues include:
- Communication Issues: Customers sometimes report difficulty resolving irregularities.
- Security Issues: This is going farther back, but at one point, Dwolla had some security issues that have since been resolved.
- Hard To Understand: Dwolla is an unusual service despite being focused entirely on ACH payments. The website does a mediocre job at clearing up what it is and how it differs from other payment services.
Positive Dwolla Reviews & Testimonials
As is so often the case in the payments processing industry, just about the only positive feedback on Dwolla comes from the company itself. Dwolla’s website includes a Case Studies page that features 27 detailed studies on how actual Dwolla customers used the platform and benefited from it. These studies are very compelling, although, as you would expect, they don’t have anything negative to say about the company.
If you’re considering signing up with Dwolla, we highly recommend that you take a look at these studies, as they’ll give you a better idea of the specific types of businesses that can benefit from the services Dwolla provides.
High points for Dwolla include:
- Standalone ACH Service: ACH services are rarely the star of the show when it comes to payment processing. The Pay-As-You-Go plan makes them easy to utilize.
- Cost-Effective: As long as you’re selecting a plan that’s appropriate to the scale of your activities, Dwolla is pretty cost-effective.
- Unique Service: There are many companies that do some of what Dwolla does, but not that many that are exactly like it.
We haven’t found much other positive feedback on the company elsewhere on the web. If you’re a Dwolla user or have used the company in the past, please feel free to tell us about your experience in the Comments section. Thanks!
Final Verdict
If you’re an eCommerce merchant looking for an ACH payment processing service, Dwolla is certainly an interesting option. With a paid plan, you’ll have access to a lot more bells and whistles than what you’d get with the kind of ACH processing options offered by most traditional merchant service providers. For certain specific types of businesses, Dwolla might just be what you’re looking for.
While the free Pay-As-You-Go plan can save you a lot of money, you’ll have to do all the work of integrating Dwolla into your website yourself, and you’ll have minimal options for technical support.
At the same time, the company’s paid plans give you access to every feature you could possibly need, including access to a developer to integrate Dwolla’s payment processing system into your website. It’s nice to see that Dwolla is now offering more plans, which makes it easier for companies to scale up from the basic month-to-month plan.
For now, Dwolla earns an overall score of 4.5 out of 5 stars.
If Dwolla is too limited (or too pricey) for your business, take a look at either Stripe Payments or PayPal’s Braintree, two other eCommerce-focused payments platforms that offer ACH processing. Finally, our article, The Best Online ACH Payment Providers For eCommerce, has several other great suggestions if you need a more traditional merchant services provider that offers both credit card and ACH processing.
The Merchant Maverick Seal of Approval 🏆
Dwolla ![]() |
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After hours of in-depth research and evaluation, we can confidently recommend this brand to our readers. Get started today and see Dwolla for yourself.
The Merchant Maverick Seal of Approval 🏆
Dwolla ![]() |
---|
After hours of in-depth research and evaluation, we can confidently recommend this brand to our readers. Get started today and see Dwolla for yourself.
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