What Is an ACH Charge on a Credit Card Transaction?

The automated clearinghouse, a financial network commonly known as the ACH that facilitates the electronic processing of bank checks, provides a number of conveniences for both businesses and consumers. Although merchants and consumers can benefit from ACH transactions, an ACH statement entry may have different meanings.

Consumer

An ACH entry on a consumer credit card statement, according to the Federal Financial Institutions Examination Council, indicates a payment made through the automated clearinghouse network. Because the ACH network typically processes check-based payments, such an entry may represent a payment made through credit card access checks that financial institutions provide to cardholders.

Business

At the end of each statement period, businesses who process credit card transactions typically receive a statement from the merchant account processor. If the merchant accepts electronic check payments, according to the merchant processor MindBody, an ACH item signifies an electronic check. In addition, the FFIEC explains that service providers often settle merchant account payments through an ACH deposit into the merchant's bank account, and an ACH entry on a merchant's credit card statement may indicate a deposit from the merchant account provider.

Benefits

Consumers can use the automated clearinghouse network to make credit card payments at merchants who do not accept credit cards and at online electronic check processors. Merchants, according to MindBody, can increase sales by accepting ACH payments, and businesses can quickly receive credit card settlements without the need to deposit a live check.