# Legacy Rail Flows

<mark style="color:purple;">ACH TRANSFER FLOW</mark>

1. The originator (such as your employer) initiates the payment or deposit by giving instructions to their bank.
2. The bank sends digital payment files to the ACH network.
3. The ACH network passes those payment files on to the receiving bank.
   1. <mark style="color:red;">...or XFT sends payment files to recieving bank. This cuts out ACH operator step.</mark>
4. The receiving bank then adds money or takes money from the receiver’s bank account.

<mark style="color:purple;">ACH DATA FLOW</mark>

1. Originator initiates a debit or credit payment order to the ODFI
2. ODFI transmits the payment information to the ACH operator
3. ACH operator receives data from the ODFI and sorts the entries by routing number
4. ACH operator transmits the entries to the RDFI
5. RDFI receives, processes, and posts the ACH data to the receiver account on settlement day

<mark style="color:purple;">CORRESPONDENT BANKING</mark>

```
PAYMENT SETTLED VIA CORRESPONDENT BANKING
1. Debiting of payer’s account with bank A
2. Crediting of bank B’s mirror account with bank A, which is kept for accounting purposes
3. Payment message from bank A to bank B via telecommunication network
4. Debiting of bank A’s account with bank B (loro account)

A. Use correspondent bank only
5. Crediting of bank C’s account with bank B
6. Payment message from bank B to bank C via telecommunication network
7. Debiting of bank’s B mirror account with bank C, which is kept for accounting purposes
8. Crediting of receiver’s account with bank C

B. Involvement of payment system
5. Payment message from bank B to payment system
6. Settlement via payment system
7. Payment message from payment system to bank C
8. Crediting of receiver’s account with bank C
```


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