ACH and ABA routing numbers: What’s the difference?

Many people are familiar with routing numbers — those nine-digit codes found on the bottoms of checks that identify a specific financial institution. Routing numbers are like our financial system’s superhighway, facilitating the transfer of funds from one account to another. Personal and business account numbers provide that exit off the superhighway, directing funds to the correct accounts.

However, many don’t know there are two types of routing numbers: ABA and ACH.

ABA routing numbers

ABA routing numbers, named after the American Bankers Association, which first designated them back in 1910, help identify banks and financial institutions. They are, in most cases, nine digits long, with the first two numbers being between 00 and 12. Smaller banks are assigned a single routing number, while multinational banks may have several. Routing numbers are used for paying bills, reordering checks, or setting up a direct deposit with your employer (for your paycheck) or the IRS (for a tax refund). ABA routing numbers apply to paper checks, which is why they are sometimes referred to as the check routing number.

ACH routing numbers

ACH routing numbers were developed in the 1970s — when the high volume of checks threatened to slow down the banking system — beginning a larger industry-wide shift toward electronic banking. The acronym ACH stands for Automated Clearing House, and like ABA routing numbers, ACH routing numbers are nine-digit numbers unique to their respective financial institutions. Unlike ABA routing numbers, ACH routing numbers are used for electronic transactions between financial institutions.¹ The first two digits of ACH routing numbers often range from 61 to 72, another way to distinguish them from ABA routing numbers.

Again, ACH routing numbers are often used for electronic funds transfers of small one-time payments or scheduled recurring payments. The word “clearing” refers to the process whereby funds move from one account to another to settle a payment; an ACH routing number helps “clear” funds for quicker transfer on the same or the next business day, much faster than paper check payments or transfers, which take more time to mail, deposit and clear. And ACH payments are less expensive, or even free, which makes this a popular way for businesses to pay salaries.

What’s the difference?

Depending on your banking institution, the ABA and ACH routing numbers might be one and the same. And that’s because ABA and ACH numbers are used for the same thing: transferring funds to their appropriate destination. And while they do have similarities — and an ACH routing number is an ABA routing number — there are differences between ACH and ABA routing numbers:

• ABA routing numbers are used for paper or check transfers. ACH routing numbers are used for electronic transfers.
• Transactions using ACH routing numbers “clear” faster (same or next day) than funds transferred on paper checks using ABA numbers.
• ACH transactions move more because they are done in batches instead of one at a time like an ABA routing number on a paper check.

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