ACH stands for Automated Clearing House, which is an electronic fund transfer system used for moving money between banks and credit unions across the United States. ACH transfers are processed in batches and can be used for various types of transactions, including direct deposit of paychecks and monthly debits for routine payments. Merchants often enable consumers to pay bills via ACH by providing an account number and bank routing number. ACH transfers can be either direct deposits or direct payments, depending on whether the money is being transferred into or out of an account.

One of the benefits of ACH transfers is that they are often free, depending on where you bank and the type of transfer involved. Another benefit is that ACH transfers are more secure than paper checks, as they are processed electronically and can be traced more easily. While many ACH payments clear quickly, transactions can sometimes take several days to complete due to the way in which an ACH is processed and precautions against fraud and money laundering.