Understanding ACH better

Author: Jane Hennessy
ACH stands for Automated Clearing House which is a US system/process for lower value, non-urgent payments and collections. ACH provides a cost effective method for corporate clients to make high volume payments such as payroll, accounts payable, dividends and expense reimbursement.
1. ACH Advantages
International ACH is chosen by customers looking for cost effective reliable payment channels. It provides an improved experience for the beneficiary. ACH doesn’t collect lifting fees on originated transactions. ACH is an intelligent use of communication, delivery channels and billing processes and expertise.
2. Customer benefits
The customer benefits in ACH are: Reduced funds movement costs, more predictable cash flow, integrated disbursements, electronic return reporting, fast confirmation, settlement on a specified value date, full value of item received by beneficiary and reduced need to maintain multiple bank relationships globally.
3. Customer industries for international ACH
Customer industries for international ACH are: travel services/ hospitality, oil/drilling/energy, engineering services, legal services, manufacturing, insurance, securities dealer, educational services, computer software and churches.
4. International Payments Framework Association (IPFA)
The IPFA is an inclusive membership organization, comprising all types of institutions in the payments value chain, which provides rules, standards, operating procedures and guidelines to improve cross-border payments through a multilateral member service agreement; technical documentation and payment format mappings to various currencies; supplementary materials covering operating models, settlement processes, generic contracts, etc.; transparency regarding pricing methodology and delivery timeframes; expertise to facilitate on-boarding and transacting; and a networking platform for exchanging information regarding practices and business opportunities.

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