![]() At the National Automated Clearing House Association, the network regulates electronic transactions for over 10,000 financial institutions via 13 Regional Payment Associations and through direct membership. Automated Clearing House TransactionsĪutomated Clearing House transactions are batch transactions of electronic payments that go through an electronic network set up by the Federal Reserve to regulate monetary flow. A good point to remember is that POS purchases are usually physical purchases where the customer receives the product or service immediately upon receipt of cash or credit. In other cases, POS transactions are not as readily accepted, because the location doesn’t accept cash or their online component doesn’t process transactions immediately. In some cases, POS transactions are more readily accepted. The main defining attribute of POS transactions are that they are complete the moment goods and services are exchanged. In the small business encyclopedia of Entrepreneur, the definition of POS systems takes into consideration that most businesses process transactions electronically. POS systems are often used to track inventory. ![]() Point of Sale transactions quite simply are those transactions that take place immediately upon receipt of goods and/or services. The key component in a POS transaction is that the transaction is completed almost immediately. This transaction can be a cash, check or credit transaction. So what are the basic differences between POS transactions and ACH transactions? Point of Sale TransactionsĪs the name suggests, a point of sale transaction is any transaction that takes place either online or in a retail store. However when you understand the POS purchases can be physical cash purchases, unlike automated clearing house purchases which have to be processed electronically, you gain a better understanding of the basic differences. You may be a bit confused at first to learn that both POS and ACH purchases can be processed electronically. It can also help you understand that POS purchases have been around a lot longer than automated clearing house purchases. ![]() A genuine understanding of how Point of Sale (POS) is different from Automated Clearing House (ACH) can help you understand why sometimes POS purchases are charged at a higher or lower rate the automated clearing house purchases.
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