Benefits of ACH

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Benefits of ACH
ACH refers to Automated Clearing House and it is the electronic network used by financial institutions such as banks for easily and quickly clearing electronic payments. This network is regulated by the guidelines and rules developed by NACHA. Since ACH offers a batch based system of processing, it allows for faster, more secure and cheaper transactions as compared to processing single paper checks.

1. Convenience

ACH offers convenience to all its customers in several ways. For instance, recurring payments can be authorized once just for the first payment. No additional authorization is needed to continue the payments when using ACH. This means transactions like payroll checks will be directly credited to the person’s account, removing the requirement of picking a check and then going to the local bank. ACH also removes the earlier need for organization s to make unique payment arrangements for workers who are on leave, vacation or working on other parts of the organization for a long amount of time.

2. Better security

Very many Americans suffer from identity theft every year. ACH believes that this identity theft comes from the theft of vital information from a victim’s bank statement and paper checks. As ACH transactions are designed to occur automatically and electronically, they dramatically lessen the amount of people who can access the personal information. Furthermore, the electronic nature of ACH transactions means that the records cannot be stolen, lost or misplaced in the mailing system. According to NACHA, most issues that occur during ACH transactions can be resolved quickly.

3. Reduces cost

In general, more electronic transactions are processed in one day as compared to using paper transactions. The wide popularity of using electronic payments with ACH has resulted in great cost savings for businesses and financial institutions that use it.
Finally, funds that are transferred using ACH can be immediately access by an account holder.

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