Glossary of Payment Terms — Flashcards

An electronic network for financial transactions - regulated by the Federal Reserve - and established to process the exchange of electronic transactions between participating depository institutions in the United States. The ACH network plays an important role in the credit card processing industry - as funds from merchant credit card sales are deposited to the merchant’s account - from the acquiring bank - via the ACH network. In Canada - the equivalent to ACH is the EFT - or Electronic Funds Transfer - network. Although ACH has been historically used to process Business to Business - Bank to Bank - or Bank to Business transactions - some payment processors are now building systems leveraging the ACH network to enable B2C (business to consumer ) models (example: Dwolla) or P2P (person to person) payments (example: Venmo).