The value of bank transfers done through Automated Clearing House (ACH) Direct Credit hit GH¢11.02billion in the first half of this year. This is about 43 percent higher than the value of transactions recorded for the same period last year, which stood at GH¢7.7billion.
The volume was 29 percent higher at about 2.9 million transactions in the first half of this year, compared to 2.2 million transactions for the same period last year. The higher growth in value suggests an increased confidence in the payment system, as more people were using it for higher value transactions.
The value and volume of ACH Direct Credit transactions are contained in the half-year product performance summary by the Ghana Interbank Payment and Settlement Systems (GhIPSS).
Direct Credit, which is one of the two forms of Automated Clearing House (ACH), is a simple, secure and reliable service that enables individuals, large and small organisations to make payments by electronic transfer directly into a bank account. It involves a debit to an account in the sender´s bank and a transfer of the amount of money directly into the beneficiary´s account in another bank.
The electronic nature of the Direct Credit makes disbursement of bulk funds quicker, safer, more secure and requires less effort and saves time. It also enables intended recipients to receive their funds on time.
Direct Credit is used for payment of salaries, pensions, welfare benefits, commissions, supplier payments, dividend and refunds among others. It is also suitable for interest payments, government payments, as well as business-to-business payments.
The use of Direct Credit to make payments started slowly but has caught on as a convenient and reliable mode of interbank transfers, especially for bulk payments. The Chief Executive of GhIPSS, Archie Hesse, explained that consistent public education together with the banks accounted for the growth in patronage of ACH Direct Credit. He said ACH Direct Credit is a more efficient way of making bulk payments such as salaries, and encouraged companies that are still paying salaries by using cheques to try ACH Direct Credit.
Meanwhile, the express form of Direct Credit recorded an even higher growth in patronage for the first-half this year. The volume of transactions shot up by over 140 percent from 131,635 to 317,716 transactions, while the value shot up by almost 170 percent from GH¢1.4billion to GH¢3.7billion. Express Direct Credit implies that the transfer is effected on the same day if the mandate is issued before 11-o’clock in the morning.
Mr. Hesse called for a lot more effort from stakeholders to popularise ACH Direct Credit. He expressed the hope that public patronage for ACH Direct Credit will significantly outstrip cheques, as it was a better alternative.