What Is an ACH Deposit?

The Automatic Clearing House Center is the main system for bank payments in the United States. The ACH system is widely used by businesses to pay employees' salaries and other businesses. Its penetration rate in the United States has reached 26%, and in some European countries, it has reached more than 90%. In Japan, nearly 100% of enterprises have realized the direct deposit of wages through automatic settlement houses Into the employee's account.

ACH

(Automatic Exchange Center)

The Automatic Clearing House Center is the main system for bank payments in the United States. The ACH system is widely used by businesses to pay employees' salaries and other businesses. Its penetration rate in the United States has reached 26%, and in some European countries, it has reached more than 90%. In Japan, nearly 100% of enterprises have realized the direct deposit of wages through automatic settlement houses Into the employee's account.

The operation process of the ACH system is similar to the paper settlement process, except that it is implemented electronically. In the early stages of ACH, the use of magnetic tape for information transmission was gradually replaced by remote communications, and real-time transactions were realized.

Chinese name

Automatic clearing house

Foreign name

Automatic Clearing House

Brief introduction

The main US system for processing bank payments

Accomplishment

Developed rules and framework for transaction exchange

Information format

PPD CCD CTP CTX

Established

1968

There are about 30 regional automatic exchange centers owned by the Banking Association, and the number of private automatic exchange centers owned by large banks or syndicates is increasing. 90% of Bank of America is a member of the Automated Clearinghouse. Deposit-taking institutions, such as credit card unions and savings and credit associations, may also be members of the automated clearinghouse. The National Association of Automatic Switching Centers (NACHA) is responsible for formulating the overall policy of automatic switching centers. Most regional automatic switching centers are composed of

Pre-arranged payments and deposits (PPD): direct deposit of wages, paid monthly

In 1968, a California bank organized a special paperless committee (SCOPE) and the California Clearing House Association was established in 1972, the first automatic clearing house in the United States. In 1974, the American Bankers Association established the National Association of Automated Clearing Houses, which was participated by various local clearing houses, to design rules and standard formats for electronic payment across regions. All 12 Reserve Banks are

The American Automated Clearing House mainly makes 5 forms of payment:

(1) Cash concentration means that large chain companies concentrate the funds of local retail institutions to the headquarters through ACH, which facilitates the use of funds by the headquarters;

(2) Direct payment of employees' salaries;

(3) Direct distribution of pensions and social benefits by the Ministry of Finance;

(4) Payment of fixed amount of funds, such as insurance premiums, interest on housing mortgage loans, etc .;

(5) Payment of inter-company loans.

in England. In 1995, BACS handled 220 million businesses valued at £ 105.5 billion. In the United States, the use of ACH increases by 9% to -22% each year. In 1995, it processed 340 million businesses with a value of 11.1 trillion US dollars.

ACH is only used in countries. The data transmission format used in different countries is different. International payment transmission is realized through The Society for Worldwide Interbank Financial Telecommunication (SWIFT). ACH is particularly suitable for small and medium-sized transactions and fixed payments. For large transactions, the risk is increased due to batch settlement rather than real-time settlement.