Gusto doesn't use a single bank—it partners with multiple banks depending on where you live and which payroll service you choose
Gusto is a payroll processor, not a bank itself. When you run payroll through Gusto, the money moves from your business bank account to your employees' banks through the ACH network (Automated Clearing House). Gusto works with partner banks to initiate those transfers, but the receiving bank—where your employee's paycheck lands—is their own bank, not Gusto's.
The partner banks Gusto uses vary by state and account type. Gusto has stated it works with multiple financial institutions to process ACH transfers, but the company does not publish a complete list of every partner bank. What matters to you is that Gusto can send money to any U.S. bank account that accepts ACH deposits, which is nearly all of them.
Your employees don't need to open an account with Gusto's partner banks. They receive their paychecks at whatever bank they already use—checking, savings, or both. Gusto simply needs your business bank account information to pull the payroll funds and route them out.
Key Takeaways
- Gusto uses multiple partner banks to process ACH transfers, not a single bank, and does not publicly list all of them.
- Your employees' paychecks go to their own banks, not to Gusto or its partners—Gusto is the middleman moving the money.
- You need a U.S. business bank account to connect to Gusto; Gusto pulls payroll funds from that account and distributes them via ACH.
- Gusto can deposit paychecks into any U.S. bank that accepts ACH transfers, which includes nearly all consumer and business banks.
How Gusto moves money from your account to employee accounts
When you process payroll in Gusto, you authorize Gusto to debit your business bank account for the total payroll amount (wages, taxes, deductions). Gusto then initiates ACH transfers to each employee's bank account on the payday you set. The ACH network handles the actual transfer between banks, which typically takes one to two business days.
Gusto's role is to calculate the amounts, format the ACH instructions, and submit them to the banking network. The partner banks Gusto uses are the ones that submit those instructions on Gusto's behalf. Your bank receives the debit request, and your employees' banks receive the deposit requests. Neither your bank nor your employees' banks is necessarily a Gusto partner—they just need to participate in the ACH system, which they do.
You must connect your business bank account to Gusto before you can run payroll. Gusto will ask for your routing number and account number. Some banks require you to verify the connection by confirming small test deposits (usually under $1 each) that Gusto sends first. This verification step protects against fraud and ensures the account is real and under your control.
What happens if your bank doesn't accept ACH debits
Nearly all U.S. banks accept ACH debits from business accounts, but a very small number of banks or account types do not. If your bank rejects ACH transfers, Gusto cannot process payroll through that account. You would need to open a business account at a bank that accepts ACH, or use a different payroll processor.
Some banks that primarily serve international customers or very small niche markets may not support ACH. Credit unions almost always do. Online banks and traditional banks both support ACH. If you are unsure whether your bank accepts ACH debits, call your bank's business account line and ask directly—they can tell you in one call.
If your bank declines an ACH debit from Gusto, Gusto will notify you, and the payroll will not process. You will need to resolve the bank connection before trying again.
Connecting multiple bank accounts to Gusto
Gusto allows you to connect more than one business bank account to the same Gusto workspace. This is useful if you have separate accounts for different business entities, locations, or purposes. You can choose which account to debit when you process each payroll run.
Each account must pass the same verification process: you provide the routing and account number, Gusto sends test deposits, and you confirm the amounts in your bank. Once verified, that account appears in your payroll settings and you can select it before processing.
If you switch banks or close an account, you need to update or remove it in Gusto's settings. Gusto will not automatically detect the change, and attempting to process payroll from a closed account will fail.
How employee direct deposit works through Gusto
When you set up an employee in Gusto, you enter their bank account information: routing number, account number, and account type (checking or savings). On payday, Gusto includes that employee in the ACH batch it sends to the banking network. The employee's bank receives the deposit instruction and credits their account.
Employees can update their own bank account information in Gusto's employee portal. If an employee changes banks or wants to split their paycheck between two accounts, they can make those changes themselves without involving you. Changes typically take effect on the next payroll run, though some changes may require a payroll cycle to process.
If an employee's bank account is closed or the routing number is wrong, the ACH transfer will fail. Gusto will notify you of the failed deposit, and you will need to contact the employee to get correct information. Some banks return failed deposits within one business day; others take longer.
Timing and when money leaves your account
Gusto debits your business bank account on the payday you set, not before. If you process payroll on a Friday for Friday payday, Gusto will debit your account on Friday. The money then travels through the ACH network and typically arrives in employee accounts by the next business day (Saturday deposits may not show until Monday, depending on the employee's bank).
ACH transfers are not instantaneous. The standard timeline is one to two business days from debit to deposit. Some banks offer faster ACH (same-day or next-day), but Gusto does not advertise same-day ACH as a standard feature. If you need same-day payroll, you would need to check with Gusto support about whether that option is available for your account.
You must have sufficient funds in your business account on payday for Gusto to debit the full payroll amount. If your account does not have enough money, the ACH transfer will fail and payroll will not process. Gusto does not extend credit or hold payroll for later.
Fraud protection and security when connecting your bank
Gusto uses encryption to protect your bank account information and does not store your full account number in plain text. When you connect your bank, Gusto uses a secure connection (HTTPS) and requires you to log in with your Gusto credentials.
The test deposit verification step is a security measure. By requiring you to confirm the small deposits Gusto sends, Gusto verifies that you have access to the account and that the account is real. This prevents someone from entering a fake or stolen account number and having payroll sent there.
If your Gusto account is compromised, an attacker could potentially change the bank account connected to payroll and redirect future paychecks. Protect your Gusto login with a strong password and enable two-factor authentication if Gusto offers it. If you suspect unauthorized access, change your password immediately and contact Gusto support.
What to do if payroll doesn't reach an employee's account
If an employee reports that their paycheck did not arrive, first check the payday date in Gusto. Confirm that payroll was actually processed and that the employee's bank account information in Gusto is correct. Then ask the employee to check with their bank—sometimes deposits take longer than expected, or the bank may have flagged the deposit as pending.
If the deposit was processed but the employee's bank rejected it (wrong account number, closed account, or other reason), Gusto will show a failed status for that employee. You will need to get correct bank information from the employee and reprocess that portion of payroll, or issue a manual check.
If Gusto shows the payroll as processed but you see no debit from your business account, contact your bank first. The debit may be pending or may have been rejected. Then contact Gusto support with the payroll date and employee name so they can investigate whether the ACH batch was actually submitted to the banking network.
Frequently Asked Questions
Can I use a personal bank account with Gusto instead of a business account?
Gusto requires a business bank account to process payroll. A personal account will not work. If you are a sole proprietor without a separate business account, you will need to open one before you can use Gusto. Some banks offer business checking accounts with low or no minimum balance requirements.
What if my bank is not in the United States?
Gusto only processes payroll for U.S. banks. If your business bank account is outside the U.S., you cannot use Gusto. You would need to open a U.S. business bank account or use a different payroll processor that supports international banking.
Does Gusto charge a fee to connect my bank account?
Gusto does not charge a separate fee to connect your bank account. Payroll processing fees vary by Gusto plan and are charged per payroll run or per employee, not per bank connection. Your bank may charge you a fee for ACH debits, depending on your account type and bank.
Can employees receive their paycheck as a check instead of direct deposit?
Yes. Gusto can print and mail checks to employees who do not want direct deposit. You pay a per-check fee for this service, which is higher than the cost of ACH direct deposit. Checks take longer to arrive than ACH transfers and are riskier if lost in the mail.
What if I need to cancel a payroll run after Gusto has debited my account?
Once Gusto has debited your account and submitted the ACH batch to the banking network, you cannot cancel the payroll. You can contact Gusto support to ask whether the batch can be recalled before it reaches employee banks, but this is not always possible. If the money has already been deposited, you would need to ask employees to return it or issue a correction on the next payroll.