Accredited ACH Professional (AAP) Practice Exam

What system includes participants like the Payor, Payee, and Bank of First Deposit?

1. ACH Network

2. Check Payment System

3. Fedwire Funds Service

4. Card Payment System

The correct answer is: Check Payment System

The correct answer is the ACH Network. This system facilitates the electronic movement of money between bank accounts through various types of transactions, including direct deposits and bill payments. In the ACH Network, participants such as the Payor, Payee, and Bank of First Deposit play integral roles in transaction processing. The Payor initiates a payment, the Payee receives it, and the Bank of First Deposit is the financial institution where the Payee holds their account. The Check Payment System primarily deals with paper checks and does not involve the automated electronic exchanges typical of the ACH Network. While it includes interactions between Payors and Payees, it lacks the structured electronic framework and the role of banks in processing electronic payments typically found in ACH transactions. Fedwire Funds Service is a real-time gross settlement system used for high-value transactions and typically operates on a different set of rules and participants with an emphasis on immediate settlement rather than batch processing like the ACH Network. The Card Payment System involves credit and debit cards, focusing on point-of-sale transactions and online purchases, rather than the transfer of funds between bank accounts through ACH transactions. Understanding these distinctions highlights why the ACH Network is correctly identified as the system that includes the roles of Payor, Payee, and Bank of First