The Clearing House

What The Clearing House actually is

The Clearing House is a utility, not a vendor. It sells nothing to businesses, signs no merchants, holds no customer accounts and has no product a company can buy. It runs the plumbing that United States banks use to move money between themselves, and it is owned by 24 of the largest commercial banks operating in the country — among them Bank of America, JPMorgan Chase, Citibank, Wells Fargo, U.S. Bank, PNC, Truist, Capital One and BNY Mellon.

Its lineage is genuinely old. Fifty-two of New York City's fifty-seven banks organized the New York Clearing House Association on 4 October 1853 to settle check and gold exchanges between themselves. The modern operating entity is The Clearing House Payments Company L.L.C., headquartered in New York and led by President and Chief Executive Officer David Watson as of July 2026. A legally separate affiliate, The Clearing House Association, does banking policy research and advocacy in Washington — the two are frequently confused, and only one of them operates payment systems.

The important structural point for anyone assessing it: although The Clearing House is owned by large banks, its networks are open beyond that ownership group. Any federally insured depository institution can join the RTP network without owning a stake. Ownership confers governance, not access.

The four systems it operates

The RTP network. Launched in November 2017, RTP was the first new core payments rail built in the United States in roughly forty years. It runs 24 hours a day, every day, carries credit-push payments only, uses ISO 20022 messaging, and has a $10 million per-transaction limit. As of June 2026 The Clearing House reported more than 1,280 participating institutions, over 1.6 billion transactions and more than $3 trillion cleared and settled since launch, with 142 million transactions worth $576 billion in the second quarter of 2026 alone. Settlement is prefunded through a joint account at the Federal Reserve Bank of New York.

CHIPS. The Clearing House Interbank Payments System handles large-value and heavily cross-border United States dollar payments. The Clearing House describes it as the largest private-sector dollar clearing and settlement network in the world, clearing around $2.2 trillion each business day across 43 participating institutions using a patented netting algorithm that produces roughly a 26-to-1 liquidity efficiency ratio — meaning participants fund a small fraction of gross value to settle the whole. CHIPS is designated a systemically important financial market utility under Title VIII of the Dodd-Frank Act and is supervised by the Federal Reserve.

EPN. The Electronic Payments Network has operated since 1974 as a private-sector automated clearing house operator, the alternative to the Federal Reserve's FedACH. It uses the standard Nacha file format, operates under the Nacha Operating Rules, and The Clearing House states it handles essentially half of United States commercial ACH volume. A transaction originated through EPN can reach any ACH endpoint regardless of which operator the receiving bank uses.

Check image exchange. The oldest business, associated with SVPCO and the ECCHO check rules, still clears image-based check presentment between institutions.

Around these sit supporting services for participants, including a UID Lookup service and a DDA Token Service.

How a business actually reaches these rails

Never directly. This is the single most important operational fact about The Clearing House and the one that most often surprises companies evaluating instant payments for the first time.

A business reaches RTP or EPN in one of two ways: through a bank that participates in the network, or through a payments provider that holds a sponsor bank relationship. The Clearing House has no onboarding process for businesses, no commercial terms for them, no support line and no contract. Everything a company experiences — availability, transaction limits below the network maximum, cut-off behavior, fees, whether receive-only or send-and-receive is enabled — is set by its bank or provider, not by the network operator.

The consequence is that two businesses using the same rail can have completely different experiences. A company whose bank has enabled full RTP send capability with a high internal limit is operating on a different product from a company whose bank only receives. Neither is negotiating with The Clearing House, and neither can.

How The Clearing House prices

Pricing is participant-facing and not published to the public. The Clearing House distributes an RTP fee schedule to participating financial institutions and has taken a clear public position that pricing is identical for all participants regardless of size or ownership stake, with no volume discounts for the large banks that own the company. That policy is a direct answer to the criticism leveled at it during the FedNow debate, and it is worth taking seriously as a stated commitment even though the schedules themselves are not readable by outsiders.

The cost structure for a participating institution comprises per-transaction sending fees charged to the originating institution, participation and connectivity fees, and — distinct from a fee — a prefunding obligation, since RTP settlement requires each participant to maintain its share of a joint prefunded balance. Prefunding is a liquidity cost rather than a price, and it is one reason smaller institutions weigh RTP participation carefully.

None of this determines what a business pays. A company's cost to send an RTP payment or originate an ACH file is set by its bank or its payments provider, which marks up, bundles or absorbs the underlying network cost as it chooses. A business comparing instant payment costs is comparing bank pricing, not network pricing, and should ask its bank directly what the network charge is and what the bank adds to it.

Fee transparency is accordingly rated limited rather than poor. The information exists and is disclosed consistently to the parties that pay it; it simply is not aimed at, or accessible to, the businesses that ultimately bear it.

Where The Clearing House is genuinely strong

Instant payments. RTP is one of only two instant payment rails in the United States and it had a nearly six-year head start on the other. Its $10 million per-transaction limit is materially higher than card-based push payment limits, which makes it usable for cases card rails cannot serve — commercial disbursement, real estate closing funds, large insurance claims, treasury movements outside banking hours. Payments are final on receipt, 24 hours a day, on weekends and holidays.

ACH at national scale. EPN has run since 1974 and clears roughly half of United States commercial ACH volume. For an institution, it is a genuine private-sector alternative to FedACH with full interoperability, which matters for operational resilience as much as for price.

Large-value dollar clearing. CHIPS is the private counterpart to Fedwire for high-value and cross-border dollar payments, and its netting design means participants settle roughly $2.2 trillion a day while funding a small fraction of that gross amount. Its designation as a systemically important financial market utility reflects what would happen if it stopped.

Institutional trust and longevity. An organization founded in 1853 that lent to banks, the stock exchange and the City of New York during the 1907 panic, and that reports losing only one member bank while roughly 8,000 United States banks failed nationally during the Depression, has a track record no fintech can claim. For the banks that rely on it, that continuity is the product.

What it does not do, and the risk that comes with finality

Most merchant-facing capabilities are rated none here, and every one of those ratings is correct rather than a shortfall. The Clearing House touches no card network and does no card acquiring or processing. It sells no checkout, gateway or e-commerce product — pay-by-bank experiences built on RTP are built by banks and fintechs above the rail. It provides no point-of-sale hardware or software, no contactless or wallet technology, no payment facilitation or sub-merchant onboarding, no orchestration layer, no crypto or stablecoin rail, and no public developer API a company can sign up for. It publishes ISO 20022 message specifications and operating rules to participants; that is the interface, and it is not self-serve.

It also underwrites nobody. Risk decisions about which businesses may send or receive belong entirely to the participating financial institution. A company declined for instant payments was declined by its bank.

The limitation that genuinely matters is structural to the rail itself. RTP is credit-push and irrevocable: there is no chargeback right, no dispute framework a business can invoke, and no mechanism comparable to a card representment. A payment sent in error or obtained by fraud is recovered only through a request for return that the receiving institution is under no obligation to honor. This has drawn growing consumer-protection scrutiny as instant-payment fraud has increased, and it cuts both ways commercially — excellent if you are being paid, dangerous if you are paying.

RTP also cannot pull funds. There is no debit capability, so collection use cases must fall back to ACH or card, or use the Request for Payment message, which is a request the payer must actively approve rather than a debit the biller can initiate. The Clearing House provides participants with network-level controls such as the UID Lookup service and a DDA Token Service, but fraud screening remains each institution's job.

Governance, FedNow and what to check before you build on it

The recurring criticism of The Clearing House is not about its systems but its ownership. A critical national payment rail owned by the largest banks in the country invites the objection that access, pricing and roadmap could favor the owners. Community bank groups and some policymakers made exactly that argument between 2018 and 2023, and it was one of the reasons advanced for the Federal Reserve building its own instant rail. The Clearing House's response has been that RTP pricing is flat for all participants regardless of size or stake, and that any federally insured depository institution can join.

FedNow launched in July 2023 and settled the question in practice rather than in principle: the United States now has two instant rails, many institutions connect to both, and the competitive discipline that critics wanted exists. The differences that matter operationally are participant reach, transaction limits and each operator's pricing.

Before designing a process around The Clearing House's rails, a business should establish the following with its bank or provider, since the network will not answer:

• Whether your institution sends, receives, or only receives on RTP — receive-only participation is common and it silently breaks outbound use cases.
• What internal transaction limit applies. The network limit is $10 million; your bank's limit is likely far lower and is the one that binds you.
• The proportion of your counterparties that can be reached. Ask for coverage against your own payee or payer list, not a national participation count.
• Whether FedNow is also available through the same provider, and how routing between the two is decided.
• Your recovery process for a misdirected payment. Get the request-for-return procedure and realistic expectations in writing before you need them, because the rail gives you no right of reversal.
• Your ACH fallback and the conditions that trigger it, including whether Same Day ACH is enabled.
• Who bears the loss in your bank's terms when an instant payment is induced by fraud. This is the question that most often has an uncomfortable answer.

Capability assessment

Every company profiled on this site is assessed against the same eighteen dimensions, so the profiles can be read against one another. Each rating carries one sentence of evidence. There is no score out of ten, because a score is not defensible and a sentence is.

Core strength means a primary, differentiating capability. Supported means genuinely offered and documented, but not a differentiator. Limited means partial, geographically restricted, gated behind an enterprise tier, or delivered through a third party. Not offered means what it says. Unclear means the company markets the capability but does not document it well enough to judge — which is itself a finding.

Competitors and alternatives

The Clearing House — frequently asked questions

Sources

This profile was built from the following primary and secondary sources. Where sources disagreed, the disagreement is stated in the text rather than resolved silently.

• https://www.theclearinghouse.org
• https://www.theclearinghouse.org/payment-systems/rtp
• https://www.theclearinghouse.org/payment-systems/chips
• https://www.theclearinghouse.org/payment-systems/ach
• https://www.theclearinghouse.org/About/History
• https://www.theclearinghouse.org/About/leadership-team
• https://www.theclearinghouse.org/about/owner-banks
• https://en.wikipedia.org/wiki/The_Clearing_House_Payments_Company