Automated Clearing House (ACH) is a secure payment
transfer system that connects all U.S. financial institutions. The ACH
network acts as the central clearing facility for all Electronic Fund
Transfer (EFT) transactions that occur nationwide, representing a crucial
link in the national banking system. It is here that payments linger in
something akin to a holding pattern while awaiting clearance for their
final banking destination. Scores of financial institutions transmit or
receive ACH entries through ACH operators such as the American Clearing
House Association, the Federal Reserve, the Electronic Payments Network,
and Visa.
In 1998, the network processed nearly 5.3 billion ACH transactions with
a total value of more than $16 trillion.
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