What does the acronym ACH stand for in the context of financial transactions?

The acronym ACH stands for Automated Clearing House. This term refers to a network that facilitates electronic payments and automated money transfers between bank accounts. In the context of financial transactions, the ACH system is crucial for processing direct deposits, payroll, and electronic bill payments, among other functions. It provides a means for financial institutions to exchange funds efficiently and securely, promoting convenience for consumers and businesses alike. The ACH is a fundamental part of the electronic payments ecosystem, enabling a seamless way to conduct transactions without the need for paper checks or manual handling, thereby enhancing the speed and reliability of payment processing.