April 21, 2020

The ACH Network: Industrial-Strength Collaboration


Michael W. Kahn

Michael W. Kahn


There’s no shortage of adjectives to describe the ACH Network, though Alex Romeo used a term you’re more likely to see on an item at Home Depot.

“Quite frankly, it is industrial strength,” said Romeo, Vice President and Product Manager for the Electronic Payments Network at The Clearing House. “When you look at the volume—almost 25 billion transactions were processed last year through this network—that’s what I mean when I say it is industrial strength. It is built for large volume, bulk payments.”

During an April 20 session on “The ACH State of the Union,” at Smarter Faster Payments: Remote Connect, Romeo noted that the reach of the ACH Network is “second to none,” with virtually all financial institutions participating. 

And both Romeo and fellow panelist Nell Campbell-Drake agreed that the ACH Network continues to evolve.

“It is truly a preferred means for many who are supporting what I call ‘life payments,’” said Campbell-Drake, Vice President of the Retail Payments Office at the Federal Reserve Bank of Atlanta. She defined life payments as “wages, benefits, insurance payments, mortgages and rents,” and said that with ACH “entrenched in these life payments,” further evolution is inevitable. 

As the two ACH Operators, the Federal Reserve and The Clearing House routinely cooperate. One example is the enhancement coming to Same Day ACH in March 2021, when a third processing window will be added at 4:45 p.m. ET. 

“It entails a major undertaking and there has been a lot of collaboration that has had to take place among multiple parties,” said Campbell-Drake. 

And as vital as that teamwork has been, Romeo noted that spirit of cooperation among ACH Operators “was never more evident” than when the first round of economic stimulus payments went from the U.S. Treasury into the ACH Network in mid-April.

“Both ACH Operators stand together, ready to help the nation in any way we can,” he said, to make sure electronic relief payments are processed in a “safe, secure and efficient manner.”

And while the national emergency will almost certainly impact 2020 ACH Network volume, the panelists agreed the overall future of the network remains bright.

“I see it as continuing to be an arsenal in the choices as a proven channel for various payments types,” said Campbell-Drake, “and it’s going to continue to evolve to meet the needs of users.”