Which term refers to a method used to mitigate credit risk, as required by ACH Rules?

The term that refers to a method used to mitigate credit risk in alignment with ACH Rules is "Exposure Limits." This concept involves setting predefined thresholds for the amount of credit exposure that a financial institution is willing to accept from its counterparties. By establishing these limits, organizations can effectively manage and control the level of risk they are exposed to within their ACH transactions.

Exposure limits are crucial in preventing excessive credit risk, as they help organizations avoid situations where they might face significant losses in the event of a counterpart's default or inability to settle obligations. This method provides a framework for decision-making regarding credit extensions and maintaining the stability and integrity of the payment system.

In contrast, incident response plans are contingency measures focused on managing responses to data breaches or security incidents, while risk assessments involve evaluating potential risks without specifically designating mitigative strategies. Control self-assessment is a process aimed at evaluating the effectiveness of an organization’s controls but does not directly deal with the concept of limits on credit exposure.