Authorized Settlement Agent

AAA

DEFINITION of 'Authorized Settlement Agent'

A bank that is authorized to submit checks and other cash items to the Federal Reserve for collection. The 12 reserve banks collect and pay checks for depository institutions; payments are also made through the automated clearing house (ACH) network and private clearing arrangements.

INVESTOPEDIA EXPLAINS 'Authorized Settlement Agent'

The Federal Reserve plays a primary role in the in the U.S. payments system. Federal Reserve payment services are available to all depository institutions, including smaller institutions in remote locations that other providers might choose not to serve.

RELATED TERMS
  1. Federal Reserve Bank

    The central bank of the United States and the most powerful financial ...
  2. Credit Facility

    A type of loan made in a business or corporate finance context. ...
  3. Automated Clearing House - ACH

    An electronic funds-transfer system run by the National Automated ...
  4. Fedwire

    A real-time gross settlement system (RTGS) of central bank money ...
  5. Federal Reserve System - FRS

    The central bank of the United States. The Fed, as it is commonly ...
  6. G.19 Report

    A monthly statistical report from the U.S. Federal Reserve that ...
RELATED FAQS
  1. What do banks do to control the bank reserve?

    While all banks are required to maintain a specific amount of bank reserves, the banks themselves do not control the minimum ... Read Full Answer >>
  2. How does wage price spiral impact interest rates?

    A wage-price spiral occurs when wages and prices rise in tandem in a self-perpetuating cycle that exerts inflationary pressure ... Read Full Answer >>
  3. What is the difference between the deposit multiplier and the money multiplier?

    The terms "deposit multiplier" and "money multiplier" are often confused and used interchangeably, because they are very ... Read Full Answer >>
  4. Who controls the Federal Reserve Bank?

    The Federal Reserve Bank was created by an act of the U.S. Congress in 1913, but the executive and legislative branches do ... Read Full Answer >>
  5. What is the minimum leverage ratio that must be attained under Basel III?

    One of the major capital standards changes of the Basel III Accord was a reduction in excess leverage from the banking sector. ... Read Full Answer >>
  6. What strategies can be used to achieve the goals of contractionary policy?

    In the United States, the Federal Reserve is charged with controlling monetary policy, and Congress (along with the executive ... Read Full Answer >>
Related Articles
  1. Economics

    The Federal Reserve

    Few organizations can move the market like the Federal Reserve. As an investor, it's important to understand exactly what the Fed does and how it influences the economy.
  2. Personal Finance

    How The U.S. Government Formulates Monetary Policy

    Learn about the tools the Fed uses to influence interest rates and general economic conditions.
  3. Options & Futures

    Financial Regulators: Who They Are And What They Do

    Find out how these government agencies govern the financial markets.
  4. Economics

    Explaining the Reserve Ratio

    Reserve ratio is the amount of cash a bank must keep in its bank vaults or deposit into a central, governing bank.
  5. Economics

    What The Fed Needs To Consider Before A Rate Hike

    Everyone, from colleagues to clients, has some interpretation of when and if the Fed should raise short-term rates and start to normalize monetary policy.
  6. Economics

    What Do the Federal Reserve Banks Do?

    These 12 regional banks are involved with four general tasks: formulate monetary policy, supervise financial institutions, facilitate government policy and provide payment services.
  7. Economics

    What is an Economic Dove?

    Dove is an economic term describing an economic monetary adviser who favors keeping interest rates low because it stimulates the economy.
  8. Investing

    What A Rate Hike May Mean For Stocks

    By the end of the year, investors will likely be contending with the first Federal Reserve (Fed) rate hike in nearly a decade.
  9. Professionals

    Why You Should Avoid Fixating on Bond Duration

    Financial advisors and their clients should then focus on a bond fund’s portfolio rather than relying on any single metric like duration.
  10. Credit & Loans

    How The Federal Reserve Affects Mortgage Rates

    The Federal Reserve's actions as it aims to maintain economic stability impact the cost of funds for banks and consequently for mortgage borrowers.

You May Also Like

Hot Definitions
  1. Bund

    A bond issued by Germany's federal government, or the German word for "bond." Bunds are the German equivalent of U.S. Treasury ...
  2. European Central Bank - ECB

    The central bank responsible for the monetary system of the European Union (EU) and the euro currency. The bank was formed ...
  3. Quantitative Easing

    An unconventional monetary policy in which a central bank purchases private sector financial assets in order to lower interest ...
  4. Current Account Deficit

    A measurement of a country’s trade in which the value of goods and services it imports exceeds the value of goods and services ...
  5. International Monetary Fund - IMF

    An international organization created for the purpose of: 1. Promoting global monetary and exchange stability. 2. Facilitating ...
  6. Risk-Return Tradeoff

    The principle that potential return rises with an increase in risk. Low levels of uncertainty (low-risk) are associated with ...
Trading Center
×

You are using adblocking software

Want access to all of Investopedia? Add us to your “whitelist”
so you'll never miss a feature!