automated clearinghouse
finance
Also known as: ACH
Quick Summary
An automated clearinghouse (ACH) is a financial network that facilitates electronic funds transfers, primarily for direct deposits and bill payments. It allows for the transfer of existing deposit balances, bypassing the need for paper checks and speeding up payment settlements. ACH networks are a type of clearinghouse, which are institutions established by firms to offset transactions and settle net balances. This system is crucial for modern monetary systems, enabling efficient electronic money transactions.12
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