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:
“Though the words Canada East on the map stretch over many rivers and lakes and unexplored wildernesses, the actual Canada, which might be the colored portion of the map, is but a little clearing on the banks of the river, which one of those syllables would more than cover.”
—Henry David Thoreau (1817–1862)