What’s the difference between the ACH Network, RTP®, and FedNow networks?

What’s the difference between the ACH Network, RTP®, and FedNow networks?

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Title
What’s the difference between the ACH Network, RTP®, and FedNow networks?

Summary
The ACH (Automated Clearing House) Network electronically moves money and related payment information quickly and securely between financial institutions. Governed by Nacha, the ACH Network has been operational for 50 years.

Using the Federal Reserve’s settlement service, payments on the ACH Network are settled four times a day. Processing of ACH payments can happen over the weekend, but settlement only occurs when the Federal Reserve’s settlement service is open.

FedNow, launched in 2023, gives businesses and individuals the ability to send and receive instant payments through participating financial institutions.

The Federal Reserve, the United States’ central banking service and governing body behind the FedNow Service, describes its offering like this:

“The FedNow Service is a new instant payment service that the Federal Reserve Banks are developing to enable financial institutions of every size, and in every community across the U.S., to provide safe and efficient payments in real time, around the clock, every day of the year.”

The Clearing House operates the RTP® network, a payment rail currently reaching 61% of U.S. demand deposit accounts (DDAs). RTP®, the network’s real-time payment system, launched in 2017.

RTP transactions on the RTP network give recipients access to funds within seconds of the sending bank initiating the transaction. RTPs are available 24/7/365, including on weekends and banking holidays.

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