Free Banking Tips

Did you recently get overdraft or non-sufficient fund fee on your account? If you had, then that might already be because of an ACH. Some people find it jargon but this is almost a common term for those people who use to get bank fees due to this "ACH".

What does ACH means? ACH stand for Automated Clearing House. In US this is the electronic network for financial institutions. Whether you bank with Wells Fargo or Bank of America all your automatic payments is processed and moved by ACH. This is where insurance premium, loan payments and other kinds of utility bills are being processed. Other debit transactions such as recurring card payments are also processed in ACH. If merchants processed your check electronically it means that it was done in ACH. Approximately more than 21 billion ACH transactions with more that $37 trillion total value is being processed in ACH today compared to $31.74 trillion last 2010.

Due to ACH we are able to process our payments easily. The only disadvantage is it can also cause some fees if we miscalculate our balance even for a single dollar or even cent. It takes one to three business days for an ACH to clear yet stopping them is difficult when the payment has already been processed. Stop payments may also help if the request was made in the earliest possible time, though some banks charges fees for stop payment request.

Some banks have already come up with options to help avoid fees due to ACH. Overdraft protection is a good option, You can also check with your bank what other agreements they have to avoid never ending fee.

Acknowledgement:  Automated Clearing House/www. ach.com