Full Form of ACH:
Automated Clearing House
ACH Full Form is Automated Clearing House. The financial transactions in the US use an electronic network. This network is referred to as the ACH or Automated Clearing House. A heavy volume of debit, as well as credit transactions, is processed by the ACH in batches. The credit transfers done by this system consists of vendor payments, payroll, and direct deposits. The debit transfers performed by it include mortgage loans, payments of insurance payments by consumers and much more. Additional applications are also included in debit transfers, like the POP or point of purchase check pilot program.
The ACH payments are used by the commercial as well as government sectors equally. ACH online is increasingly being used by the businesses for obtaining the payment done by customers, instead of making the customers use debit or credit cards. ACH is a computer facility based on settlement and clearing. It helps by processing the electronic transactions’ exchange between the participating institutions. The Federal Reserve and NACHA have established certain rules that govern this network.
More than twenty billion transactions have been processed by it in the year 2013, their total value being thirty-eight trillion dollars. Separate networks are used for handling credit card payments. The biggest ACH operator in the US is the Federal Reserve Bank. It works by using the Fed ACH system. More than sixty percent of transactions between the commercial banks were processed by it in the year 2005. The only ACH operator of the private sector is the EPN or Electronics Payment Networks and was responsible for processing the remaining forty percent of the transactions.