What is ACH?

Posted by Checkbook on Jan 21, 2019

ACH or, Automated Clearing House, is a widely used digital technology for transferring funds from one bank account to another. It is the most common technology used to transfer funds in the United States. NACHA is the organization involved in the transfer of funds through ACH. NACHA stands for National Automated Clearing House Association.

What is a Clearing House?

A clearing house is an intermediary between parties exchanging goods, in our case, a check. When person X wants to send funds to person Y using a check, the clearing house is the middle man that executes the receipt and delivery of that check.

If ACH is being used, funds from the Sender's account are electronically transferred to the Recipient’s account. ACH doesn't require there be a physical exchange of cash or checks. Thus the term "Automated" in the title. The middle man in this case is intangible and automated. These transactions are typically settled within 3-4 business days.

Automation is the standard today. It is the expectation. “Automated” does not mean the same thing as instant, though. ACH does not guarantee funds in less than 3 business days, nor does it offer real time status updates on the check.

Digital Checks, however, provide instant bank verification and safer encryption.

About Author: Nicholas Bragg & The Checkbook Team

Related Posts

Digital Check Solution Checkbook.io Makes Headway in Auto Finance

Baxter Credit Union, based in Illinois, has found a new solution to an old, and costly problem. David Brydun, vice president of consumer lending, exclusively told Bank Innovation that the financial institution has partnered with Checkbook.io on a digital check issuance solution that utilizes blockchain.

Checkbook lets you email anyone a Digital Check and deposit it free

"If you’re sick of running out of paper checks and stamps or hassling with routing numbers to send zero-fee payments, you can bank on Checkbook.", says Josh Constine of TechCrunch

What Are ACH Payments?

ACH payments can be confusing. You might have heard they can save your business with payment processing fees, but not sure how. We are going to cover what ach payments are, ach payments processing, and if ach payments are safe.

Ready to get started?

Explore Checkbook, or create an account instantly and start sending payments. You can also contact us to design a custom package for your business.

icon
Always know what you pay

Integrated per-transaction pricing with no hidden fees.

icon
Start your integration

Get up and running with Checkbook in as little as 10 minutes.