ACH Transfer

What is an ACH transfer?

An ACH transfer moves money electronically between bank accounts through the Automated Clearing House network. Unlike wire transfers that process individually, ACH transfers batch process through the Federal Reserve or EPN networks. ACH is commonly used for direct deposit of payroll, vendor payments, customer bill pay, and recurring transactions. It is inexpensive but takes one to three business days.

ACH credits vs debits

ACH credits push money from your account to someone else, like payroll deposits to employee accounts. ACH debits pull money from someone else's account to yours, like automatic bill payments your customers authorize. Businesses use both types. Credits require you to initiate the payment. Debits require prior authorization from the account holder being debited.

ACH for business payments

Many businesses pay vendors via ACH instead of checks, saving check stock, postage, and processing time. Set up vendor banking information securely. Initiate payments with enough lead time for processing before due dates. ACH fees are typically much lower than wire fees, often just cents per transaction. For regular payments to the same recipients, ACH is usually the most efficient method.