International ACH transfers: What is an ACH payment? [2024]
ACH payments – also called ACH (bank) transfers – are an electronic method of moving money from one bank account to another. ACH payments are very commonly used in the US, when sending money in dollars from one account to another – whether that’s paying a bill, getting your salary, or passing some money over to a friend. Some banks also let you send international ACH transfers.
We’ll cover all you need to know about ACH payments in the US and how it’s possible to send international ACH transfers in this guide. We’ll also touch on alternative ways to send money online with providers like OFX and Wise.
Quick summary: International ACH transfers
- ACH transfers are a popular choice when it comes to making domestic transactions in the US.
- For international transfers, alternatives like wire transfers and debit and credit cards may be more suitable.
- While it’s possible to send money globally via an international ACH, it’s not common and may not always be the most efficient option, with SWIFT payments being much faster.
- Providers like OFX and Wise offer specialized international money transfer options. OFX provides fee-free transfers in over 50 currencies to 170 countries, while you can hold, spend and receive in 40+ countries and send payments to 160+ countries with Wise at the mid-market exchange rate.
- Global ACH payments are cheaper compared to SWIFT payments but take longer. Wise offers various payment methods alongside low and transparent fees starting from 0.42% and the mid-market exchange with 50% of payments being instant.
What is an ACH payment?
Let’s start with the basics. ACH payments are bank to bank electronic transfers, which are processed through the Automated Clearing House system – hence the name, ACH. ACH payments are organized by NACHA – the National Automated Clearing House Association.
Even if you’ve never heard of an ACH payment you’ve almost certainly received one. ACH payments are the preferred method of sending direct deposits such as employer payroll, government payments and benefits, and even IRS rebates.
ACH payments are also regularly used by banks, so if you make electronic transfers using your online banking system, or set up recurring payments to cover loans or mortgage payments for example, you’re probably using the ACH system there too.
Can you send ACH transfers internationally?
It is technically possible to use ACH payments to send money overseas. However, not all banks offer this service to their customers.
Depending on your own bank you may need to use a wire transfer instead when sending a payment internationally.
A great alternative is to send your transfer using a third party provider like Wise or OFX. In this case you can often pay the provider locally in USD with an ACH (bank) transfer (or another payment option like debit or credit cards), and the provider will then deposit the money into your recipient’s account in the destination country. We’ll explain more on that later.
What is the international version of ACH?
An international ACH Transfer (also known as a Global ACH) is a type of cross-border payment that originates from a US-domiciled bank account that’s physically located in the United States and can be used to send money from a US bank account to a foreign account using local payment systems, like SEPA in Europe or EFT in Canada. Although International ACH Transfers tend to be slower, they are also cheaper, compared to alternative methods like SWIFT transfers and are sometimes even free depending on the bank or specialist provider.
It’s important to note that international ACH transfers and International ACH Transactions (IAT) are different and refer to the code that used to classify these cross-border payments within the ACH network. So, while International ACH Transfers refer to the actual process of transferring money from a US account to an international account, IAT refers to how these transfers are categorized and processed within the ACH system.
International ACH transfers
If your bank offers international ACH payments as an option, it’s worth weighing up whether this will come with lower fees compared to the alternative payment options available.
Banks usually prefer to offer customers international wires – we’ll look at how these work shortly – which can be pretty expensive to arrange, and may not have the best exchange rates available.
Alternatives to send money internationally
ACH transfers aren’t the only option. Depending on where you’re sending money to, and what payment features are most important to you, you may find an alternative way to send money online suits you better. Let’s look at some popular options – OFX, Wise and WorldRemit – and how the measure up on features:
| Feature | OFX | Remitly | Wise | WorldRemit |
|---|---|---|---|---|
| Coverage | Send in 50+ currencies, to over 170 countries | Transfer money internationally to 170+ countries and 100+ currencies | Hold, spend and receive in 40+ currencies and send payments to 160+ countries | Send to over 130 countries in over 70 currencies |
| International transfer fees | No fee | Vary by destination – a service fee is added to the transfer amount. | Variable fee based on destination and payment type | Variable fee based on destination and payment type |
| Exchange rates | Exchange rates include a markup on the mid-market exchange rate | Exchange rates include a mark-up on the mid-market rate. | Mid-market exchange rate | Exchange rates include a markup on the mid-market exchange rate |
| Payment options | Pay by bank transfer Have your money deposited into the recipient’s bank account | Pay by bank transfer, credit or debit card. Have your money deposited into the recipient’s bank account. Recipients can also receive money as a cash pickup, mobile money account, home delivery or a debit card deposit depending on the recipient’s location | Pay by bank transfer, credit or debit card Have your money deposited into the recipient’s bank account | Pay by bank transfer, credit or debit card Have your money deposited into the recipient’s bank or mobile money account, or collected as cash |
| International transfer speed | 1 – 2 days | Express delivery can be immediate, Economy payments take 3 – 5 business days | 50% of payments are instant | Can be instant for cash collections |
| Safety | Fully regulated in the US and everywhere else they offer services. | Fully regulated in the US and everywhere else they offer services. | Fully regulated in the US and everywhere else they offer services | Fully regulated in the US and everywhere else they offer services |
| Great for | Customers who want to talk through their payment by phone – 24/7 support offered | Those who need a wider range of countries and currencies. | Low cost payments with the mid-market exchange rate | Great range of payout options |
As you can see, alternative online providers can be a good option – particularly if you want to send money overseas and your own bank doesn’t offer international ACH transfers. Here’s a summary of the providers we picked out to review:
- OFX: Send payments in 50+ currencies, with 24/7 phone support if you’d rather talk through your options and pay by phone
- Remitly: Send payments to over 170 countries in over 100 currencies, with a wide range of payout options as well as Economy and fast Express transfer options.
- Wise: Send payments to 160+ countries with the mid-market exchange rate and fast delivery times
- WorldRemit: Great range of pay out options including cash collections which makes this a popular way to send money home to loved ones
OFX
With OFX you can send funds in over 50 currencies to more than 170 countries worldwide. Customers can now enjoy the perks of zero OFX transfer fees, offering a low-cost solution for international money transfers without any hidden fees. However, exchange rates do include a markup on the mid-market exchange rate.
OFX payment methods include a direct debit straight from your bank account or via a wire transfer and your money will be deposited straight into your recipient’s bank account for a secure and direct transfer. Time frames include 1-2 business days.
Remitly
Remitly has a broad international reach, covering over 170 countries and supports transfers in over 100 currencies. Fees vary based on destination, with a service fee added to the transfer amount and Remitly also applies a markup on the mid-market rate for their exchange rates.
Customers can make payments via bank transfers, credit or debit card and recipients have the flexibility to receive funds directly in their bank accounts, as cash pickup, in a mobile money account, through home delivery or via a debit card deposit depending on their location.
Wise
You can send payments to 160+ countries with Wise. Offering transparent and low fees Wise uses the mid-market exchange, the same rate one you might find on Google, meaning that they don’t add a mark-up to the exchange rates. Fees vary depending on destination and type of payment method, and start from as low as 0.42%.
Wise provides a wide range of payment options, including bank transfers, credit or debit cards, bank debit (ACH), wire transfer and SWIFT.
WorldRemit
With WorldRemit, users can send money to over 130 countries in more than 70 currencies, catering to a wide and diverse customer base. Fees for international transfers vary depending on the destination and payment type and the exchange rate also includes a markup.
WorldRemit offers payment options including bank transfers and credit or debit cards. The service deposits your funds into the recipient’s bank or mobile money account or makes them available for cash collection.
Alternative payments using ACH
While ACH payments are a popular method for domestic transactions they’re not the only option available. Alternatives to ACH include wire or bank transfers, debit and credit cards, prepaid cards as well as Google and Apple Pay, with each varying when it comes to speed and convenience. For example, wire transfers tend to be faster than ACH but may cost more while prepaid cards are a convenient option for those without a bank account.
OFX payment methods: Direct debit, Wire transfer
Wise payment methods: Bank Debit (ACH), wire transfer, debit/credit card, SWIFT or using your Wise account balance
Remitly payment methods: Apple Pay, bank account, Google Pay, prepaid cards and Visa or Mastercard debit or credit cards
WorldRemit payment methods: Apple Pay, debit, credit or prepaid cards
How to make an international ACH transfer: Step by step
Here’s a quick step by step guide to making an international ACH bank transfer – before you get started you’ll need to double check your own bank offers this service as it’s not universally available from major US banks:
Step 1: Get your recipient’s details
Before you get started you’ll need to make sure you have everything that’s required to set up your international ACH. Usually that’ll include:
- Recipient’s name
- Recipient’s address
- Recipient’s bank name
- Recipient’s IBAN or account number
- Recipient’s bank routing information – this varies by country
Routing information will vary depending on where you’re sending the payment to – for example the UK uses sort codes, while for payments to Australia you’d need a BSB number. These codes and numbers work like ABA routing numbers in the US.
Step 2: Log into online banking
If international ACH payments are available for you, the most convenient way to set one up is likely to be online. Log into your regular service and look for payments, or global payments to see if you can send an international ACH with your bank. If you can’t send an international ACH it may be worth looking at alternative providers to see if a third party service can help you send money overseas for a lower price than a bank wire.
Step 3: Enter the transfer details
Add the amount you want to send and the currency it should be received in. You’ll also be prompted to enter the recipient’s personal information and bank details, and add a message or reference so they can see who the transfer is from.
Step 4: Check everything and confirm
It’s common to need to complete a security or verification step here- your online banking service will guide you through if this is required.
What information is needed for international ACH transfers?
To make an international ACH transfer, you’ll typically need to provide the following:
- Your recipient’s full name and address
- Routing number
- The recipient’s bank name and IBAN or account number
- Recipient’s bank routing number
- Purpose of payment and whether you are sending to a business or personal account
- The transaction amount
How to make an ACH payment
The process for making an ACH payment will vary a little depending on your own bank’s online or mobile banking system.
However, the basic steps are usually the same. Here is how to make an ACH transfer:
- Log into your online banking service
- Select the options to make a domestic transfer or pay a bill
- Follow the prompts to enter the recipient’s name, bank account number and routing number
- Confirm the amount you want to pay, and whether the payment is one off or recurring
- Check everything over and confirm to complete the transfer
What information is needed for ACH transfers
Exactly what you need to send your ACH may depend on your own bank’s processes – but you’ll normally have to provide:
- Recipient’s name
- Recipient’s address
- Recipient’s bank name and account number
- Recipient’s bank routing number
How does ACH payment processing work?
ACH payments are initiated and then processed by the clearing house at various stages throughout the day. The ACH network operates almost 24 hours a day during the working week, with standard payments processed 4 times a day, and same day payments processed at 3 points every day. ACH payments are not processed over weekends or public holidays.
Once the payment has been processed by the clearing house it is usually available for the recipient very quickly – although the exact process does depend on the recipient’s own bank’s system.
How much do ACH payments cost?
It’s free to receive an ACH payment, so your bank or credit union won’t charge you for getting your salary paid by direct deposit for example. It’s also usually free or fairly cheap to send ACH payments or pay bills by ACH – check your own bank’s policy on this.
In some cases account holders can make a certain number of free ACH payments per month before fees apply, so knowing the fees and limits associated with your account is essential.
Here are the ACH payment fees for a few major US banks:
| Bank | ACH Fees |
|---|---|
| Bank of America | 3 Day ACH (consumer) – 3 USD fee Next day ACH (consumer) – 10 USD fee |
| US Bank | No fee |
| Wells Fargo | No fee (ACH payments processed via Zelle) |
| Capital One | No fee |
| JP Morgan Chase | 1% fee of the payment, up to 25 USD per transaction for same-day ACH payments. |
International ACH transfer costs
Very few US banks offer international ACH payments – if yours does it’s worth asking them directly what their fees are. Here’s a quick reminder of the fees for international payments funded using an ACH, with the specialist services we looked at earlier:
- OFX: No transfer fee, just a low markup added to the mid-market rate
- Remitly: Varied fees based on payment type and destination
- Wise: Low transfer fees with no markup on the exchange rate
- WorldRemit: Varied fees based on payment type and destination
Are you looking to make a payment to a foreign contractor? This guide may be helpful: How to may payments to foreign contractors
How long do ACH payments take to process?
ACH direct deposits can be set up as same day, next day or 2 day payments, while the ACH payment processing time can mean money is received on the same day or next day.
That means for example, that an employer can schedule payroll 2 days in advance to be sure that employees will get their money first thing on payday.
Here’s how the providers we looked at earlier measure up on delivery times for international payments:
- OFX: 1 -2 days
- Remitly: Express transfer can be instant, Economy option can take 3 to 5 business days
- Wise: 50% of payments are instant
- WorldRemit: Cash collection payments can be instant
What is the difference between ACH and international ACH?
ACH payments are mainly used for moving money between banks within the U.S, like paying for bills, direct deposits or receiving your salary, and are a quick and efficient way of transferring money at home. International ACH refers to sending or receiving money from a bank in another country and requires additional details like the country of the recipient’s bank.
What’s the difference between international ACH vs wire transfer?
While ACH payments and Wire transfers are both ways to move money from one bank account to another, they do both have different features, fees and benefits to consider. Here’s a rundown:
| International ACH | Wire transfer |
|---|---|
| Not commonly available | Most banks offer wire transfers |
| May not be processed instantly | Usually processed instantly |
| Fees may be lower | Fees can be on the high side |
| Usually preferred for payments where economy is most important | Usually preferred for payments where speed is most important |
International wire transfers
International wire transfers are often used when making international payments through traditional banks, too. In this case the fees used can be especially high – both for the sender and the receiver.
Depending on how the payment is processed, international wires may also involve currency conversion fees and third party costs.
Wire payments – features and benefits
While bank wire transfers can be costly, they are a smart choice under some circumstances. Here are some benefits of wire payments:
- Immediate processing – good for when a payment needs to arrive quickly
- A wire payment can only be processed if the funds are available in the sender’s account – the money can be quickly released once it arrives
- Wire payments can not usually be reversed once initiated
- International wire transfers are usually the standard offer for sending money overseas with a traditional bank
- Higher fees make wire transfers more popular for one off, high value transfers
What is the difference between SWIFT and Global ACH?
While both SWIFT (Society for Worldwide Interbank Financial Telecommunication) and Global ACH (Automated Clearing House) refer to types of electronic fund transfers, they are different systems. SWIFT is used to make payments internationally and is a vast messaging network used by financial institutions worldwide to quickly and safely send and receive information, including money transfer instructions between banks. Well known for its speed, it can be more expensive due to fees charged by each bank as your funds get passed through the transfer chain. ACH is mainly used for domestic bank transfers and is used to make payments within the US. It’s typically cheaper compared to SWIFT but is also slower.
| SWIFT | Global ACH | |
|---|---|---|
| Speed | Faster, 1-2 days on average | Lower transfer speed |
| Cost | More expensive due to fees charged by each bank involved in the transfer | Lower fees |
| Reach | Global reach, available in most countries | Limited to countries with ACH networks, mainly in the US |
| Ideal for | Large, urgent transfers | Smaller, regular payments |
| Transaction volume | Suitable for high-value transactions | Best for lower-value, recurring transactions |
| Security | Extremely reliable, established and secure | Secure but limited coverage and support |
Do you need a swift code for ACH payments?
ACH payments don’t require a SWIFT code as they are different systems. ACH payments are processed through a network of domestic banks that rely on routing numbers and bank account numbers to identify sending and receiving banks. For International ACH, this system connects with local banking systems in the recipient’s country. SWIFT codes, on the other hand, are used for international wire transfers processed via the SWIFT network, and use a completely different system. Therefore, while SWIFT codes are essential for making global wire transfers, they’re not needed for ACH payments.
ACH payments pros and cons
| ACH Pros | ACH cons |
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Types of ACH payments: Direct deposit vs direct payment
In broad terms you can split ACH payments into direct deposits and direct payments.
Direct deposits: Usually made from a company or organization to an individual
Direct payments: can be made by individuals, companies or organizations.
If you’re arranging bank to bank transfers within the US online using your own bank’s system you may not even know you’re setting up an ACH payment – but as this is one of the cheapest and easiest options for domestic transfers, it’s probably the default your bank offers.
Common places direct deposit ACH payments are used include:
- Payroll – 93% of US employees get their salaries via ACH direct deposit
- Government payments which are made to large groups of people are usually via ACH
- ACH is used for annuity payments, or interest payments from investments and savings
- The IRS uses ACH payments when it distributes tax rebates
You’ll also often use direct payments – here are some examples:
- Sending money with Venmo or Zelle? That’s probably an ACH payment
- Many low cost or free domestic transfers made using online banking are ACH payments
- Recurring payments made from a personal bank account to a company often use the ACH network
- Online bill pay usually uses ACH payments
Conclusion: What is ACH?
ACH payments are extremely commonly used in the US for everything from sending money to a loved one to paying your electricity bill. Often if you’re setting up a payment locally through your bank you’ll be making an ACH – even if you don’t know it.
International ACH payments are theoretically available – but in practice very few US banks offer ACH payments across currencies. However, providers like OFX, Wise and WorldRemit can offer a neat solution. Set up your international payment with an alternative provider like OFX, Wise or WorldRemit, to pay in USD using an ACH (bank) transfer, and have your money deposited into your recipient’s account overseas. That can cut the costs versus using a bank international wire – and may also be faster than a regular wire, too.
International ACH payments FAQs
What is needed for an ACH transfer?
You’ll usually need to provide:
- Recipient’s name
- Recipient’s address
- Recipient’s bank name and account number
- Recipient’s bank routing number
How long does an ACH transfer take?
ACH transfers may take a day or two to arrive, depending on the ACH service your sender has used.
How do I receive an ACH payment?
To receive an ACH payment you’ll just need to give the sender your banking details including your account and routing number – the money will then be deposited right into your account.
How do I check my ACH transfer status?
Log into your online or mobile banking to check on your ACH transfer status most easily.
Is ACH only available in the US?
ACH is a US-based network used for electronic payments and money transfers. Even though it’s mainly used for domestic payments in the United States, some banks offer ACH services that can facilitate international transactions.
Can ACH be used for international payments?
ACH can be used for international payments through the international ACH Transaction (IAT) method, but not all US banks offer this service and usually prefer to offer their customers international wires.
What is the IAT payment method?
IAT stands for International ACH Transactions and are just like any other ACH transfers, except that they are categorized as international and are specially designed for international transactions. Unlike regular ACH transfers that are domestic, IATs are used when the payment is transmitted to or originates from a foreign country.
