Automated Clearing House (ACH)

Turnkey scalable solution for the processing of low value payments and cheques combining efficiency and reliability of service with sound position maintenance and liquidity management facilities…

The Montran ACH Solution

The Montran Automated Clearing House (ACH) has been designed, from its inception, to perform real-time immediate netting of payments, cheques and other financial instruments. It handles batch processing in either continuous or deferred settlement mode.

The ACH can handle very large volumes of low value payments and cheques, and combines efficiency and reliability of service with sound position maintenance and liquidity management facilities.

The ACH is an electronic clearing system that enables files of payment instructions to be exchanged among financial institutions. It calculates multilateral net positions and submits a net settlement instruction to RTGS to perform the settlement.

ACH Performance

The Montran ACH is designed and sized to handle large volumes of payments and files. The Montran ACH system has been benchmarked, together with an independent Auditor, and proven to process more than 25,000,000 payments within two hours on a dual-socket Intel machine (8 cores). The system may optionally forward detailed files on validation. Incoming data files may be transformed into batches per Bank and recombined into signed outgoing data files per recipient bank to reduce network over-loading. This design allows the Montran system to be cost and performance effective for both low volume and high volume operators.

  • Features
  • Modules
  • Security

Features of the Montran ACH

  • A modular component structure to meet individual requirements and provide flexibility for growth and expansion as needs arise.
  • ACH payment entry and processing using standard message formats with or without image records i.e. ISO 20022, X9, NACHA, SWIFT XML, bulk payment and country specific message formats.
  • Instant Funds 24/7 clearing with flexible settlement
  • Cheque truncation and data capture from cheques at point of presentment, including image capture.
  • Settlement of net positions in one or more sessions per day at pre‐specified times, set by the ACH operator.
  • Supports Pre-funded Netting, Protected Netting via Pooled funds, or Open netting arrangements.
  • Supports inter CSM (inter ACH) operation based on EACHA
  • Capability to interface directly, or via SWIFT, to RTGS and CSD systems for collateral provisioning and final settlement.
  • Integration with the Montran Mandate Management, Dispute Management and AML modules
  • Capability to carry over queues and balances between intraday clearing cycles.
  • Real-time monitoring, including - but not limited to - messages, count and volumes of payments in sessions or daily totals, actual and projected positions, account balances for both the ACH operator and participating institutions
  • Complete monitoring of account balances for both the ACH operator and participating institutions.
  • Complete monitoring of projected positions available to both the ACH operator and Participants.
  • Operational reliability with backup and contingency arrangements.
  • Maintenance of a statistical database with query and reporting facilities, including charts.
  • Secure, encrypted, digitally signed, interactive communication for system monitoring and file exchange.
  • ACH file submission and payment data entry modules.
  • Calculating and requesting the required collateral in anticipation of a settlement session.
  • Capability to suspend payments.
  • Processing high priority payments or VIP cheques in real time mode with continuous settlement.
  • Store and forward function to allow submission of files overnight, to optimize network bandwidth usage.
  • A multi-currency and multi-lingual system.

ACH Core Modules

  • Message Switch Module - This module is a central relay station between the various Participant Systems and the Montran Automated Clearing House System. It determines the correct routing of files and messages either to the Montran ACH module or to other Participant Banks. This module also provides the ACH connectivity to external systems and interfaces, e.g. RTGS, CSD, SWIFTNet FileAct, and other.
  • Payment Processor - This module forms the core of the Montran Automated Clearing House System. It records all debits and credits to the technical accounts of the Participant and generates a multilateral net settlement transaction for final settlement.
  • The Accounting Space Facility - This service maintains the position of all the Participant Banks with the Central Bank or Clearing Institution. It also maintains queues of unsettled files and provides the functionality for the extensive liquidity management services provided by the System.
  • File Processor Module - This module manages the primary validation and control functionality. It ensures that only payment files that meet all the system criteria are forwarded to the Payment Processor module. The sorting of payment instructions into homogeneous batches is also handled by this module, before submitting the transactions for clearing to the Payment Processor module.
  • Statistical Database and Reporting Module - This database is the repository of all information pertaining to the daily processing of files by the Montran ACH. It maintains the audit history of all transactions processed by the ACH and can be used to generate required reports.
  • Billing Module - This module interfaces with the Database and Reporting module to calculate charges and produce customer billing statements. Statement production can be customized to Bank requirements. Automatically produced statements can be printed, or transmitted via available networks.


The Montran ACH is designed to interface to a variety of electronic delivery services from the most basic Local Area Network to the most sophisticated like SWIFTNet. The ACH is designed to handle changes in network services with a minimum disruption to existing applications. PKI Digital signature technique using a PKI service is used to secure the transmission of the payment instruction files from Participants to ACH. Files transmitted are digitally signed at the batch level. Communications between ACH and other systems is encrypted using SSL, and user certificates are stored on smartcards/eTokens.

  • Based on open system architecture
  • A standard browser based "thin client" user interface
  • Server application components written in Java and running in an enterprise environment, Java EE 5.0 application server
  • Interoperability through the use of standardized Java API (JDBC, JMS, JTA, JCA), Interface adapters, and SOA integration
The Montran ACH allows integration with all standard open databases and supports XML file transfer, industry standard and proprietary data formats. The application architecture allows for maximum hardware platform independence, providing the system with a long life cycle and upward compatibility. It also provides cost effectiveness, reliability, forward integration and dependable performance.