What is ACH Processing?

ACH (Automated Clearing House) processing is a secure electronic method for transferring funds between bank accounts within the United States. It’s widely used for direct deposits, bill payments, and other bank-to-bank transfers.

Unlike credit card payments, ACH transactions are routed through the ACH Network, governed by NACHA (National Automated Clearing House Association), and typically offer lower transaction fees.

How ACH Transactions Work

1. Customer Authorization
   The customer grants permission for the business to debit or credit their account. This can be obtained in writing, electronically, or verbally.

2. Transaction Submission
   The merchant’s payment system sends the ACH file to their bank or payment processor.

3. Network Processing
   The transaction is routed through the ACH Network, where banks coordinate the transfer of funds.

4. Settlement & Posting
   Funds move between the customer’s and merchant’s bank accounts, and the transaction posts to each account.

Regulatory & Compliance References

To help merchants stay compliant and confident when working with ACH transactions, use the resources below:

• Nacha Operating Rules – The official requirements for processing ACH payments.

• Nacha Guidelines – Easy-to-follow guidance for applying the rules in real-world scenarios.

Tip: Always review the latest Nacha updates before processing or supporting ACH payments to ensure you’re meeting current requirements.

Partner Solutions:

ACH services are managed through our approved solution providers:

• VCI– ACH processing partner platform for select ACH processing needs. Review their documentation and compliance guides to ensure you are meeting both VCI and Nacha requirements.

• iStream– ACH processing partner offering integrated solutions. Follow their operational procedures in conjunction with our internal compliance standards.