Here's a good NPR Planet Money episode on how transferring money works. http://www.npr.org/sections/money/2013/10/04/229224964/episode-489-the-invisible-plumbi

Here's a good NPR Planet Money episode on how transferring money works. http://www.npr.org/sections/money/2013/10/04/229224964/episode-489-the-invisible-plumbing-of-our-economy http://www.npr.org/sections/money/2013/10/04/229224964/episo... Apparently, back in the days before ACH, banks met up at a parking lot in NYC every night and literally exchanged bags of paper checks. There was a proposal build something better than ACH, but it was denied because the cost to upgrade the infrastructure would cost too much for small banks and credit unions.