Clearing of Payments
In the United States, NACHA-The Electronic Payments Association, formerly the National Automated Clearing House Association, organizes the mechanism for the financial service institutions that participate in the Automated Clearing House (ACH) network. These organizations use the ACH to transfer funds either as debits or credits between participating institutions. Most, but not all, U.S. banks are members of the NACHA. Typical uses of ACH transactions are for automatic payroll programs, monthly mortgage or membership payments, or among non-profit organizations, as a monthly donor/contribution program.
MasterCard and Visa also serve as mandatory clearinghouses for transactions on their networks. First Data Corp. attempted to clear Visa transactions itself, but then Visa sued in order to maintain its monopolistic status on clearing.
Read more about this topic: Clearing House (finance)
Famous quotes containing the word clearing:
“[Panurge] spent everything in a thousand little banquets and joyous feasts open to all comers, particularly jolly companions, young lasses, and delightful wenches, and in clearing his lands, burning the big logs to sell the ashes, taking money in advance, buying dear, selling cheap, and eating his wheat in the blade.”
—François Rabelais (1494–1553)