Automated Clearing House (ACH) payments are a staple in modern financial transactions, offering a quick and efficient means for businesses and consumers to move money between different financial institutions. These electronic funds transfers (EFT) eliminate the need for physical checks or cash, boasting lower transaction costs compared to wire transfers.
In 2020, ACH payments saw an 8.2% rise in transaction volume and a 10.8% increase in value. By 2022, the U.S. processed 30 billion ACH payments, amounting to a staggering $76 trillion. However, this convenience and widespread use have made ACH payments a target for fraud, with ACH debit fraud ranking as the second most common payment fraud.
Alessa, which provides a complete view of AML risk, has delved into the mechanisms of ACH fraud and offers strategies for businesses to mitigate their risk.