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Global ACH

There is no comprehensive global ACH equivalent of the ACH system that is available worldwide.  Instead, similar electronic payment systems have been created in a number of countries, which are intended for payment transactions within those countries.  A few large international banks have created links between these systems, which simulate a global ACH system.  Under their systems, a company enters payment information, which the banks then reformat into the standard format of the country where the payment will be made.  As such integrated systems become more common, there will likely be a decline in wire transfers in favor of global ACH payments.  Such payments will be especially popular among recipients, who are not charged the lifting fees that are common for wire transfers.

The existing global ACH payment system is not perfect.  Here are two limitations that are of particular concern:

• Limited coverage.  Global ACH systems are by no means truly global.  National ACH systems have been built in much of Europe, North America, India, Singapore, Hong Kong, New Zealand, and Australia, and these systems can be linked into the ACH systems of other countries.  However, outside of these regions, wire transfers remain the most reliable method of funds transfer.
• Limited remittance information.  Some national ACH systems do not allow for the inclusion of remittance information with a payment, so the payer needs to send this information by some alternative method, or make the information available on a Web site.

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Automated clearing house (ACH)