Automated Clearing House (ACH)

What is the ACH?

ACH stands for the Automated Clearing House. It is an electronic clearing system in which low-value payments and cheques are exchanged among financial institutions.

How does the ACH work?

ACH is a way to move money between banks electronically over a network. Anyone with access to a bank who wants to make a payment to someone who has a bank account can use this system.

For what purpose would I use the ACH?

ACH payments are simply funds transfers from one bank account to an account at another bank. Here are common uses for the ACH:

  • A customer pays for a service
  • An employer deposits money to an employee's account
  • A consumer moves funds from one bank to an account at another bank
  • A business or individual pays a supplier for products

How do I make an ACH Transaction?

If you want to make a payment, you need the beneficiary’s bank information and bank account number.

To receive payments in your bank account, you will need to provide your bank information and your bank account number to the payer.

With the ACH, you can choose to send a same-day Electronic Funds Transfer (EFT) or an Instant Funds Transfer (IFT).

Ask your teller to send an EFT for low-value payments (under $50,000) and bulk payments, such as payroll and accounts payable. EFTs are processed within the same day. Payments will be made by the end of the day.

If you need to send a payment urgently, choose to send an IFT. An IFT is an electronic payment that is available 24/7. The payment will be processed within a few minutes.

Ask your bank if these options are available online.

How does the ACH benefit me?

It gives you new electronic payment options, where you can receive or send payments faster.

Is it safe to give out my bank account number?

To receive payments in your bank account, you will need to provide your bank account number to the payer. It is safe to give out your bank account number. Someone with your bank account number can only deposit funds into your bank account.

How Much Does it Cost?

Contact your bank for their fees to send an EFT or an IFT.