What are consumer-authorized recurring payments in ACH?

Consumer-authorized recurring payments in ACH refer to transactions that consumers approve for their accounts to be debited automatically on a regular schedule. This means that once a consumer provides authorization for such payments, the process will execute automatically without needing additional input or manual intervention for each transaction.

This convenience allows consumers to set up regular payments for various services like subscriptions, utilities, or loan payments, resulting in timely payments and reduced chances of late fees. Recurring payments can be set for predetermined amounts and intervals, streamlining personal finance management.

Understanding the nature of consumer-authorized recurring payments highlights the functionality and benefits of using ACH for these types of transactions, specifically its automation and reliability as a payment option that is consumer-friendly.