Receiving depository financial institution (RDFI): The bank or other financial institution that receives the ACH transaction.Originating depository financial institution (ODFI): The bank or other financial institution that initiates the ACH transaction.The banks sending and collecting money in an ACH payment are either the: Pull transactions are debit transactions, and the recipient’s bank initiates the transfer and pulls money from the payer’s account. Push payments are credit transactions where payers instruct their bank to send money from their account to another account. While most payment networks can only push or pull, ACH can do both as needed. Push payments send money, and pull payments collect it. How do ACH payments work?ĪCH payments work through ACH credits and ACH debits-also called push and pull payments. Learn more about the differences between ACH and wire transfers. While ACH and wire transfers are both used for bank-to-bank transfers, wire transfers are often completed on the same day and can come with higher costs. Wire transfers aren’t the same as ACH payments. Direct payments include ACH credits and ACH debits. This type of ACH transaction works by sending and receiving funds. That exchange is possible through ACH direct payments. Your friend might use Zelle® or another payment app to send you their share. ACH direct payment: Imagine that you and a friend split a dinner check, and you front the bill.When the employer sends a credit to their employee’s account, they transfer money directly from their account to their employee’s. ![]()
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