All About ACH Transaction: Definition, Processing, Fees
by Jake Cole
The Automated Clearing House, (ACH), is a system of financial organizations that perform a substantial amount transactions in the United States. These ACH transactions are performed digitally and are a very efficient way to transfer money between people, businesses and banks. During 2009, there was 18.76 billion ACH transactions that accounted for tens of trillions of dollars.
Nowadays, ACH transactions are really important to our economy. They make e-commerce possible and provide cashless options. This makes them one of the most secure and most secure ways to transfer funds.
Listed below are ACH transaction types:
-Direct deposits -Debit card transactions -Automated online bill transactions -Business-to-business payments (B2B) -E-commerce payments
ACH Transaction Processing
The transaction process starts once the receiver authorizes the originator to issue a transaction. Sometimes it is, for example, a debit or credit transaction and the originator might be a retail store, an employer, a utility company or even a regular person just like you or me.
Next, an Originating Depository Financial Institution, or ODFI, which is a bank or any other traditional bank, acts for the originator and enters the financial transaction into the ACH network. The ODFI then sends the originators transaction data to the operator.
The operator then directs the ACH purchase to the appropriate Receiving Depository Financial Institution, or RDFI. This RDFI acts on the part of the receiver, which may be a major business or an individual, to issue a debit or credit on the receiver's account. And, consequently, the ACH purchase process is complete.
ACH Transaction Fees
The ruling body of the Automated Clearing House is the National Automated Clearing House Association, (NACHA). NACHA charges a fee for each and every transaction an ACH operator makes as well as an additional annual fee. Right now, NACHA charges $.000133 for each ACH transaction as well as an annual fee of $144.
The costs were implemented to further pay for developments to the ACH network. At present, the ACH transaction fees assist NACHA's ACH network administration services, which feature:
-ACH network risk management applications -ACH network top quality enhancements -Maintenance and enforcement of the NACHA operating regulations -Development of rules for first time ACH applicants -ACH network communications, research and statistics -Administration of the National ACH marketing plan
Ever since the transaction fees were set up in 2008, they've gradually climbed. However, they're small in comparison to the amount of money that ACH operators are able to move per year. There isn't any doubt that the future of the ACH network will only continue to grow as more and more individuals are transitioning to electronic systems to take care of their transactions.
If you want to find out more about <a href='http://www.infobarrel.com/ACH_Transaction_Definition_ACH_Transaction_Processing__ACH_Transaction_Fees'>ACH transactions</a>, follow the link to this site dedicated to explaining the<a href='http://www.infobarrel.com/ACH_Network'>ACH Network</a>.
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New Unique Article!
Title: All About ACH Transaction: Definition, Processing, Fees
Author: Jake Cole
Email: brent.hale@ymail.com
Keywords: ach network,ach transaction,ach transaction processing,ach transaction definition,ach transaction fees
Word Count: 434
Category: Ecommerce
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