What is a primary characteristic of ACH transactions?

ACH transactions are indeed characterized by being typically lower in cost compared to other payment methods. This cost efficiency can be attributed to the electronic nature of ACH payments, which reduces the need for physical checks or cash, streamlining processing and administrative efforts. As a result, ACH transactions are often favored for large volumes of payments, such as payroll and vendor payments, where keeping costs down is essential.

While real-time processing may be a feature of some payment systems, ACH transactions typically operate on a batch processing basis, which distinguishes them from real-time payment methods. The requirement of extensive paperwork is generally not associated with ACH, as this payment method is designed to facilitate electronic transfers with minimal documentation compared to traditional methods like checks. Lastly, while ACH transactions do typically occur on business days, the main distinguishing feature regarding costs is a critical aspect of why they are widely adopted in various payment scenarios.