When Do ACH Payments Post?

TheAutomated Clearing House (ACH) network has become a popular way to  send and receive payments, and it’s smart to familiarize yourself with it if you want to enjoy fast, reliable, and convenient payments without the hassle of delivering physical checks to the bank. 

One of the main questions people ask using the ACH scheme for the first time is: When do ACH payments post? 

Some ACH payments take only a few hours, while others take several business days. This duration depends on the time of day you initiate the transaction, the payment of expedited services, and whether the payment request has an error.

Many people also need clarification on ACH payments vs. wire transfers. But, unfortunately, these processes aren’t the same. Therefore, you must understand the difference between ACH payments and wire transfers.

While both processes allow you to transfer funds electronically, they differ in terms of the process of transferring funds, the speed of the transaction, the cost of the transaction, and the safety of funds. 

While ACH payments happen between two bank accounts through an ACH network, wire transfers happens directly between two financial institutions like banks and cash offices.

Therefore, a wire transfer takes less time to process than an ACH payment because an ACH payment goes through various review stages set up by the ACH network for accountability and safety. While this review slows down the process of transferring funds, it guarantees your money's safety.

Are ACH payments safe? Yes–unlike wire transfers, which happen instantly, ACH payments give you enough time to cancel the transaction in case there’s a problem. In a wire transfer, you can’t cancel or reverse a payment once the funds have been sent to the recipient.

How Does an ACH Payment Work?

Every ACH payment request is made as one message within a bunch of digital mail packages sent by the requesting bank, commonly called the ‘originating depository financial institution’ (ODFI).

The ACH network repackages these batches by each recipient and distributes each request to the bank receiving it. This bank is called the ‘receiving depository financial institution’ (RDFI).

This process normally occurs every business day at five separate intervals, starting from 6:00 AM to 10:00 PM Eastern Time. Several factors affect how ACH transfers work. For instance, these transfers vary depending on the type of request made. The request can be either credit or debit.

An ACH credit payment is commenced by the sender (typically a financial institution), whereas the receiver of the funds commences an ACH debit payment. In an ACH debit payment, the bank is requested to pay by the payee, and the payee must seek authorization from the payer.

The online ACH payment processing company you choose will determine how successful and rapid the process will be. For example, if the originator pays for expedited services, such as same-day transfer services, the payment will be processed much faster.

Additionally, an error or failure during the transfer of funds will affect the time it takes to process your ACH payment. For instance, if you enter the wrong routing number or bank account details in your payment request, the transaction won’t post, and you’ll be required to resubmit the request.

If the payer cancels or revokes authorization before the transfer is complete, your ACH payment won’t go through. In other instances, the payer’s account may have insufficient funds, causing the bank to reject the request.

How Long Does an ACH Payment Take to Complete?

How long an ACH payment takes to complete depends on whether the payment is debit or credit. Credit payment requests take less time than debit requests because the latter requires you to seek signed authorization from the payer, which requires more time to complete.

Moreover, banks can freely decide to process credit ACH payment requests within a day or two, but they have to process debit payments the subsequent business day. Therefore, if the banks involved are experiencing operational delays or it’s a holiday, your ACH payment will take longer to post.  

In short, many factors determine how long your ACH payments will take to post–but you can speed up the process by working with a reliable and proficient ACH payment processing platform like Seamless Chex!

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