There are new payment regulations on the horizon in California regarding payment for wholesaler alcohol invoice payments. With these new regulations, all local retailers must pay for wholesaler alcohol invoice payments via electronic funds transfer (EFT) beginning December 31, 2025. This applies to beer, wine, and distilled spirits. CA distributors and retailers can enroll in Fintech’s automated EFT payments for alcohol deliveries to comply with the new law. This change modernizes alcohol invoice processing statewide and allows businesses to take advantage of safer, speedier, and more secure payments.
What Are EFT Payments?
California’s regulations define them as “the electronic transfer of money from one bank account to another, either within a single financial institution or across multiple institutions via computer-based systems.”
California EFT Stipulations
According to the law, alcohol distributors are responsible for selecting a third-party payment processor used to facilitate an electronic funds transfer. Other notable clarifications to consider:
- California’s 30-day credit limits remain unchanged and at the wholesaler’s discretion
- Electronic payments include credit cards – but the retailer must pay the transaction fee for each credit card transaction
- Wholesalers and retailers must pay their own costs for EFT services (neither party may pay for the other)
- Wholesalers must initiate the payment process – this is accomplished by uploading invoices to Fintech, for example
- Wholesalers will be responsible for selecting which third-party payment platforms they use, but there is an exception for retailers already using a third-party payment platform
This is similar to what happened in Michigan in 2023; however, unlike Michigan, there are no exceptions that allow wholesalers to remove retailers from EFT if they have repetitive bank returns (insufficient funds).
Making the Switch to EFT Sooner Rather Than Later
As with any business change, getting some runway before the change is official is best practice, allowing time to familiarize oneself with the new processes. This is why it is recommended that California retailers adopt an EFT model for their alcohol invoices before the deadline. This allows more time for bank filters to be updated so transactions can be processed without any issues. It also allows users more time to train on using the custom portals built into some EFT services. These portals can include payment reports, reconciliation tools, data insights that highlight cost variance across alcohol distributors, and more. With more lead time, businesses will be well-versed in how to process payments and use additional tools built into their portal to enhance operations.
Take Advantage of Fintech’s California Network
Fintech has a strong presence in California. We are currently partnered with more than 400 local alcohol distributors and over 20,100 retailers. This change presents an opportunity to expand our network and continue providing exceptional service with alcohol invoice payment collection for distributors and wholesaler alcohol invoice payments for retailers.
You can read more about the California update here.
If you are an existing Fintech PaymentSource® customer, you can log in to your account here to add all your alcohol distributors to your Fintech account at no additional cost and pay them automatically through Fintech. Need help adding your distributors? Reach out to us at [email protected]. Don’t see your distributor in the system? Let us know at [email protected] and we will reach out to them on your behalf.
