what is the automated clearing house ach 
the automated clearing house ach is an electronic funds transfer system run by nacha it serves as a versatile feature for conducting digital transactions by processing large volumes of credit and debit transactions for this reason many banks brokerages and private retail businesses have made this feature available to their customers this has allowed its customers the ability to receive direct deposits and pay bills in a timely manner the automated clearing house traces its roots back to the late 1960s but was officially established in the mid 1970s the payment system provides many types of ach transactions such as payroll deposits it requires a debit or credit from the originator and a credit or debit on the recipient s end 1investopedia michela buttignol