What does ACH primarily facilitate?

Automated Clearing House (ACH) primarily facilitates high-volume, low-value payments. This electronic payment network is designed to handle large numbers of transactions involving relatively small amounts of money efficiently and cost-effectively. ACH is widely used for direct deposits, payroll, utility payments, and other types of recurring transactions, which typically fall under low-value payments.

The structure of ACH allows financial institutions to batch process these transactions, making it ideal for handling numerous payments at once without individual transaction fees that could accumulate if processed individually. This aspect makes ACH a cornerstone in the domestic electronic payment landscape, providing a reliable and convenient method for merchants and consumers to transfer money without the need for physical checks.

In contrast, high-value international transfers, real-time settlement transactions, and cross-border remittances are typically handled by other networks like wire transfers, SWIFT, or similar systems designed for higher stakes and different operational requirements.