Electronic Funds Transfers Make the Grade
There's a whole world of electronic money transfers moving
out there that you may not be aware of. You generally understand
how the ATM system operates, how Direct Deposit brings your
pay to your account, and how checks clear.
But you may not
know that electronic funds transfers (EFTs) are becoming
increasingly important in today's commerce, especially through
ACH, or Automated Clearing House, transactions. Why? EFTs
are faster, more accurate, and more secure
than other methods of transferring money. And ACH may affect
you more than you think. In fact, ACH processes many of your
financial transactions by…
- Clearing your checks.
- Depositing your paychecks, Social Security benefits, or
pension payments directly to your account.
- Processing your ATM withdrawals from your checking or
- Transferring funds from one account to another when
you choose that option.
- Withdrawing funds from your account to pay insurance
premiums, club memberships, utilities,
and countless other automatic payments you have set up.
- Paying merchants from your checking account when you
use your debit or ATM card.
- Handling your credit card transactions.
ACH can also convert a paper check to an E-Check when you
make a payment, when a retail merchant or company uses that
form of receivable payment. For this reason, checks are often
not returned to you. But Echeck transactions have the benefit
of allowing your account statement to reflect details of
the transaction in greater detail than if a paper check were
If you feel this is all happening too
fast, you're not alone. It can be dizzying. But today's rapidly
growing EFT technology ultimately makes the transfer of money
easier, faster, more accurate and more secure than ever before.