What Is an ACH Payment? Examples for Business

Short answer: an ACH payment is an electronic transfer between two US bank accounts that travels over the ACH Network, the system behind payroll direct deposit and automatic bill payments. Nacha, which writes the network's rules, says it "reaches all U.S. bank and credit union accounts" and processed 35.2 billion payments worth $93 trillion in 2025. An ACH payment can push money (an ACH credit, like a paycheck) or pull it with permission (an ACH debit, like a utility bill). For a business, ACH is the low-cost way to take large or recurring payments, usually settling in one to a few business days.

What does ACH stand for?#

ACH stands for Automated Clearing House. It is a US network that moves money between bank accounts in batches. Nacha notes that people call these payments by other names too: direct debit, EFT, electronic bank transfer and eCheck. If your customer says "I'll pay by bank transfer", they often mean ACH.

ACH is different from a card payment (which runs on the Visa or Mastercard networks) and from a wire (which moves one payment at a time and is final). For a side-by-side comparison with wires, see ACH vs wire transfer.

Examples of ACH payments#

Nacha's own examples are payroll direct deposit (a credit) and insurance premium payments and electric bills (debits). It says credits make up "just under 50%" of ACH payments and debits "just over 50%".

How does an ACH payment work?#

Every ACH payment passes through the same five parties. Nacha's developer guide defines them:

Nacha says there are two ACH Operators: "the Federal Reserve Bank and the Electronic Payments Network (The Clearing House)."

Step by step, a debit at checkout looks like this:

1. The customer authorizes your business to debit their account and shares the account (often through a bank login).
2. Your processor, through its bank (the ODFI), adds the debit to a batch file.
3. The ODFI sends the file to an ACH Operator.
4. The Operator sorts the entries and sends each one to the customer's bank (the RDFI).
5. The RDFI takes the money from the customer's account; settlement moves it to the ODFI.
6. Your processor pays it out to your bank account.

A credit runs the same path in the other direction: the payer's bank pushes money to the receiver's bank.

How long does an ACH payment take?#

ACH runs on banking days, in batches. Nacha says payments can be processed "in a matter of hours on the same business day," or scheduled one or two business days later, and that the network "settles payments four times a day." It also estimates that about 80% of ACH payments settle in one banking day or less.

The Federal Reserve's published FedACH schedule shows how this works in practice: three same-day windows with submission deadlines of 10:30 a.m., 2:45 p.m. and 4:45 p.m. Eastern, settling at 1:00 p.m., 5:00 p.m. and 6:00 p.m. Eastern, and next-day items settling at 8:30 a.m. Eastern.

Settlement stops when the Federal Reserve's settlement service is closed, which Nacha says is on weekends, federal holidays, and business days from 6:30 p.m. to 7:30 a.m. Eastern.

Same Day ACH is the fast lane. Nacha reports 1.4 billion Same Day ACH payments worth $3.9 trillion in 2025. Each one can be up to $1 million today, rising to $10 million on 17 September 2027.

What a business sees is slower than the network, because processors wait to confirm the payment did not fail. Stripe, for example, says ACH Direct Debit "can take up to 4 business days to receive acknowledgement of success or failure." For more on speed, see Can you accept ACH payments instantly?.

What information is needed for an ACH payment?#

For online debits, Nacha has also required since 19 March 2021 that a business's fraud detection "must, at a minimum, validate the account to be debited" the first time it is used. That is why many checkouts now ask the customer to log in to their bank rather than type the numbers: the login supplies the details and validates the account in one step. See bank account verification for WordPress for the options.

What rules apply to an ACH debit?#

ACH debits carry the most rules, because money leaves someone's account at another party's request. From Nacha's developer guide:

• Authorization: "For consumers, a debit authorization must be in writing or similarly authenticated", with clear terms. Recurring debits must explain how to revoke.
• Proof: the business must be able to show it had permission, and provide that proof within 10 days of a request.
• Notice of changes: at least 7 calendar days' notice if the date of a recurring debit changes, and 10 calendar days for an amount change on a consumer account.

The difference between debits and credits, including who can start each one and their return windows, is covered in ACH debit vs ACH credit.

Can an ACH payment be reversed or returned?#

Yes. The customer's bank can return a debit. Plaid's documentation gives the two windows that matter most: most returns must happen "within 2 banking days" of settlement, while for unauthorized returns "the window is 60 calendar days." Insufficient funds (code R01) is, in Plaid's words, "by far the most common return type." The full list is in ACH return codes.

Returns are the main cost of ACH for a business. A card authorization tells you at once whether the money is there; an ACH debit can come back days after you shipped.

How much do ACH payments cost?#

The cap is why ACH matters for larger payments: on Stripe's public prices, a $1,000 payment costs $29.30 by card and $5.00 by ACH. Other providers' ACH fees are compared in ACH payment processors for small business, and Stripe's full list is in Stripe ACH fees.

Who uses ACH?#

Nearly everyone with a US bank account, often without knowing it. The common business uses are:

• Getting paid on invoices: customers push money with an ACH credit, or you pull it with their authorization.
• Subscriptions and memberships: recurring ACH debits instead of cards that expire.
• High-value orders: where the card fee would be large.
• Payroll and supplier payments: ACH credits in batches.

It is a weaker fit for small impulse purchases that ship the same day, because the payment can still fail after you ship.

Taking ACH payments online#

To accept ACH payments on a website, a business needs four things: a processor that can originate ACH debits, clear authorization wording at checkout, a way to validate the customer's account, and a plan for what happens while the payment clears.

The third and fourth are where most problems start. Typed account numbers lead to "no account" returns; an unfunded account leads to R01 returns; and each return counts against your business under Nacha's rules (see Nacha return rate thresholds). A bank login that confirms the account, checks the balance and compares the owner's name with the buyer's removes much of that risk before the debit is sent.

For the setup itself on WordPress, see How to accept ACH payments in WooCommerce or, for subscriptions, ACH payments for membership sites.

How BankBridge helps you take ACH payments#

BankBridge is a WordPress plugin that adds Plaid Link to WooCommerce checkout and MemberPress signups. Your customer picks their bank, logs in through Plaid, and chooses an account; Plaid Auth returns the account and routing number for the payment, which also validates the account. Before the debit, BankBridge can run Plaid Balance for available funds, Plaid Identity to compare the account owner with the buyer, and Plaid Signal to score the chance of a return. The ACH payment then goes through a processor such as Stripe or Dwolla, or through Plaid Transfer if Plaid approves your business (WooCommerce doc).

Plans start at $79 a month for a single site ($149 for five sites, $299 for unlimited). Plaid bills its own fees to your Plaid account. If you only need a basic ACH option and already use Stripe, the free Stripe plugin with micro-deposits may be enough to start. To see the bank login flow, try Plaid's Sandbox on the live demo, then pick a plan.

This guide is general information, not legal or financial advice. Figures are from Nacha, the Federal Reserve and providers' public pages, checked 26 October 2026, and change over time. Plaid is a trademark of Plaid Inc. and Stripe is a trademark of Stripe, Inc.; BankBridge is not affiliated with or endorsed by either.