Introduction to ACH Check Processing
The ACH (Automated Clearing House) check processing have fast became one of the most reliable and safe transfer systems if we talk about the electronic funds. It is used by many banks and other financial institutions worldwide so as to make credit transactions or to clear debit in between individuals or the businesses. This is much cost efficient when compared to processing paper checks. The financial institutions in U.S. trust the functionality of ACH check processing and use it in place of previous paper check processing.
The ACH transaction starts when a receiver authorizers an originator to issue ACH check processing which is then debited or credit to the receiver’s account. Originator can mean a utility company, individual, employer or a retail store. Originating Depository Financial Institution (ODFI) is the financial institution that plays the role of transaction on behalf of the originator and then enters a particular transaction to the ACH network. After this is done the ACH operator gets the ACH transaction data that has been sent by the ODFI.
ACH operator like the Federal Reserve channelizes the ACH transaction to the concerned Receiving Depository Financial Institution (RDFI). It is thus very imperative to know that how your business or organization can be benefited by using the ACH check processing in place of paper checks. For this you can do a research on the ACH vendors and get to know a particular ACH vendor that can fulfill your needs in the best way. After you select the vendor/business then establish an account with it and thereafter start using the ACH check processing.
