Corporate User Resources

Generally, an Originator must obtain authorization from the Receiver to originate one or more entries to a Receiver’s account, except for credit entries for which the Originator and Receiver are both natural Persons. (Subsection 2.3.1)

The Originator of a credit entry to a consumer account of the Receiver may obtain the Receiver’s authorization in any manner permitted by applicable legal requirements. (Subsection 2.3.2.1)

The Originator of a debit entry to a consumer account of the Receiver must obtain a written authorization that is signed or similarly authenticated by the Receiver. (Subsection 2.3.2.2)

The writing and signature requirements for consumer debit entries may be satisfied by complying with the Electronic Signatures in Global and National Commerce Act (E-sign Act). An electronic authorization must be visually displayed in a manner that enables the consumer to read the communication. (Subsection 2.3.2.3)

• Language regarding whether the authorization is for a single entry, multiple entries or recurring entries.
• Amount of entry/entries or a reference to the method of determining the amount.
• Timing (including start date), number and/or frequency of entries.
• Receiver’s name or identity.
• Account to be debited.
• Date of the Receiver’s authorization; and
• Language that instructs the Receiver how to revoke the authorization directly with the Originator (including time and way Receiver communication with Originator must occur).
• For a single-entry scheduled in advance, the right of the Receiver to revoke the authorization must afford the Originator a reasonable opportunity to act on the revocation prior to initiating the entry.

For a single-entry authorized by a Receiver, Originator must make an audio recording of the oral authorization or provide the Receiver with written notice confirming the oral authorization prior to settlement of entry and retain the original or a copy of the written notice confirming oral authorization for two (2) years from date of authorization. For a recurring entry authorized by the Receiver, Originator must comply with the requirements of Regulation E for the authorization of preauthorized transfers, including the requirement to send a copy of the authorization to the Receiver and retain for two (2) years from the termination or revocation of the oral authorization, the original or duplicate audio recording of oral authorization and evidence that a copy of the authorization was provided to the Receiver in compliance with Regulation E. For a standing oral authorization, Originator must make audio recording of oral authorization or provide Receiver with written notice confirming oral authorization prior to settlement of the first subsequent entry and retain the original or duplicate audio recording of oral authorization or the original/copy of the written notice confirming the oral authorization for two (2) years from termination or revocation of standing authorization. (Subsection 2.3.2.4)

Yes, an Originator must retain the original or a copy of each written authorization of a Receiver, or a readily and accurately reproducible record evidencing any other form of authorization. (Subsection 2.3.2.5 (a))

An Originator must retain the original or a copy of each written authorization of a Receiver, or a readily and accurately reproducible record evidencing any other form of authorization, for two (2) years from the termination or revocation of the authorization.

With respect to a standing authorization, Originator must retain original or a copy of each standing authorization for two (2) years following the termination or revocation of the authorization, as well as proof that the Receiver affirmatively initiated each payment in accordance with the terms of the standing authorization for two (2) years following the settlement date of the entry. (Subsection 2.3.2.7)

Upon the request of an ODFI (Originating Depository Financial Institution), an Originator must provide the original, copy or other accurate record of the Receiver’s authorization, including, with regard to a standing authorization, evidence of the Receivers affirmative action to initiate a subsequent entry in accordance with the terms of the standing authorization. Originator must provide in such time and manner as to enable the ODFI to deliver the authorization to a requesting RDFI (Receiving Depository Financial Institution) within ten (10) banking days. (Subsection 2.3.2.7 2(c)

By providing the Receiver with a conspicuous notice including the following or substantially similar language prior to the receipt of an Eligible Source Document (i.e. check):
“When you provide a check as payment, you authorize us either to use information from your check to make a one-time electronic fund transfer from your account or to process the payment as a check transaction.” Copy of notice must be provided to Receiver at the time of transaction. (Subsections 2.5.1.2 and 2.5.10.2)

By providing the Receiver with a conspicuous notice including the following or substantially similar language prior to the receipt of an Eligible Source Document (i.e. check): “When you provide a check as payment, you authorize us either to use information from your check to make a one-time electronic fund transfer from your account or to process the payment as a check transaction. For inquiries, please call (retailer phone number.)” Copy of notice must be provided to Receiver at the time of transaction. (Subsection 2.5.2.2)

No, according to the ACH Rules you may originate a prenotification entry to a Receiver’s RDFI prior to the first transaction you send. (Subsection 2.6.1)

An Originator that has originated a prenotification entry may initiate subsequent entries as soon as the third banking day following the settlement date of the prenotification entry, provided the ODFI has not received a return or notification of change related to the prenotification. (Subsection 2.6.2)

An ODFI must provide the Originator with the NOC information within 2 banking days of settlement date of the NOC or corrected NOC. (Subsection 2.11.1)

Yes, an Originator must make the changes specified in the NOC or corrected NOC within 6 banking days of notification receipt or prior to initiating another entry, whichever is later.
An Originator may choose, at its discretion, to make changes specified in any NOC or corrected NOC received with respect to any ARC, BOC, POP, RCK and Single-Entry TEL or WEB.
For an NOC received in response to a prenotification, the Originator must make the changes prior to originating a subsequent entry if the NOC is received by the ODFI by the opening of business on the 2nd banking day following the settlement date of the prenotification. (Subsection 2.11.1)

It is important for businesses to watch their accounts closely as the RDFI has only 2 banking days from settlement date to return CCD and CTX transactions that post to a non-consumer account. The RDFI may request a copy of the authorization for the transaction and ask the ODFI to accept a late return but the ODFI is not required to take a late return. This would only be an attempt to the recover the money. The Originator and Receiver may also deal directly with one another to resolve the issue.

This means the Receiver did not know the identity of the Originator, had no relationship with the Originator or did not authorize the Originator to debit their account. For an ARC or BOC entry it means the signature on the source document (check) is not authentic, valid or authorized. For a POP entry it means the signature on the written authorization is not authentic, valid or authorized.

This means the Receiver has a relationship and authorization for debit with the Originator, however; an error in the payment exists such that the entry does not conform to the terms of the authorization you obtained from the Receiver. For example, the entry is for a different amount than authorized, the entry was initiated for settlement earlier that authorized, the entry is part of an incomplete transaction, the debit entry was improperly reinitiated and for an ARC, BOC or POP entry, the source document was ineligible, notice was not provided or the amount was not accurately obtained from the source document. It could also mean that the reversing entry was improperly initiated or the Receiver did not affirmatively initiate a subsequent entry in accordance with the terms of a standing authorization.

An R10 return generally requires a new authorization, however; an Originator may reinitiate a return entry (other than an RCK) if:

• Entry was returned insufficient or uncollected funds
• Entry returned stop payment and reinitiation has been separately authorized by the Receiver
• Originator has taken corrective action to remedy the reason for return

The Originator must reinitiate the entry within 180 days after the settlement date of the original entry. An Originator receiving an R11 return may correct, if possible, the error or defect in the original entry and transmit a new entry that conforms to the terms of the original authorization, without the need for a new authorization. New entry must be transmitted within sixty (60) days after the settlement of the return entry.

If a consumer Receiver completes a Written Statement of Unauthorized Debit form, the RDFI may return a consumer transaction within 60 calendar days. The Originator must not reinitiate the entry. They can settle the matter with the consumer outside of the ACH Network or gain a new authorization and send another transaction through.

Utilizing the proper SEC code is paramount for several reasons:

• Returns are based on SEC code. For example, a business originates a debit to another business for supplies they have shipped, and they use the PPD code. This transaction should be coded as a CCD. Since the PPD code was utilized, the business Receiver of the transaction now has 60 days to dispute the transaction as unauthorized versus the 2 days for a CCD transaction.
• There are different authorization requirements depending on the SEC code. Utilizing the correct SEC code for a transaction tells the RDFI what type of authorization was received.
• When your company signed an ODFI/Originator agreement you agreed to originate certain SEC codes based on that agreement.

An Originator may initiate a reversing entry to correct an erroneous entry previously initiated to a Receiver’s account. An authorization is not required for a reversal entry if all the requirements of Section 2.9 of the ACH Rules are followed.

Appropriate Reason to Send a Reversal (Subsection 2.9.1)	Must Not Use Reversal Process (Subsection 2.9.5)
Duplicate file or entry	Failed to fund entry* Originator Third-Party Sender
Payment in wrong amount	Outside of 5 banking days of Settlement Date of erroneous entry
Payment destined to wrong Receiver	*Effective 6-30-21
Employee received both a separation check and a direct deposit
Error in Effective Entry Date*

For each reversing entry, the content of the following fields must remain unchanged from the original, erroneous entry to which the Reversal relates:

• Standard Entry Class Code
• Company Identification/Originator Identification; and
• Amount

The description “REVERSAL” must replace the original content of the Company Entry Description field transmitted in the original batch, including content otherwise required by the ACH Rules.

Real-time payments (RTP®) are payments initiated and settled nearly instantaneously. A real-time payments rail is the digital infrastructure that facilitates real-time payments. Real-time payment networks provide 24x7x365 access, which means they are always online to process transfers. This includes weekends and holidays.

In the United States, the most prominent example of a real-time payments network is The Clearing House’s RTP network.

The term real-time payments should not be used interchangeably with the term faster payments. While they are similar, there are some key differences. Faster payments solutions, such as Nacha’s Same Day ACH, post and settle payments faster than traditional payment rails, but faster does not mean instantaneously.

Other payment solutions, like Mastercard and Visa’s push payment solutions will message transactions within seconds or minutes. However, because they do not also settle transactions quickly, push payments are considered a faster but not real-time payment.

While all real-time payments can be considered a form of faster payments, not all faster payments are conducted in real time.

The first reason is obvious: they are faster. Payments that settle instantaneously are available just as quickly. For individuals or businesses needing funds ASAP, instant access can be a game changer.

Real-time payment rails also bring end-to-end communication. Historically, communication has flowed in one direction: from the payer to the payee. If the two parties want to exchange information back and forth, they must do so outside of the payments system. Real-time payments connect the payment with payment data together in a single transaction.

Additionally, lag times and a lack of transparency surrounding the arrival of the funds can hinder communication. All in all, a fragmented communication process comes with challenges impacting everything from business flow to liquidity and risk management.

Fortunately, payments made in real time solve these challenges. Bilateral communication through integrated information flows, instant payment confirmation notifications, and settlement finality result in a more efficient payment journey. With real-time payments, financial control, cash positioning, and liquidity management are now in reach.

Beyond communication improvements, The Clearing House (TCH) real-time payments rail has shown that a number of use cases exist for making payments in real time. Real-time payments are also irrefutable, meaning once payments are received, they cannot be taken back or reclaimed by the sender.

As merchants, businesses, and banks recognize the value of real-time payments, adoption will continue to increase and use cases will continue to emerge. Organizations of different types and sizes see real-time payments in a positive light and are eager to adopt them.

It’s a payments network that improves the flow of commerce in the digital age by enabling consumers, businesses, and governments to send and receive funds in real-time, anytime to and from their secure bank account. It has unique capabilities that improve efficiency and cash flow, such as real-time posting, immediate confirmation and secure two-way messages with relevant data, that serve as a foundation for bank services.

The characteristics of a real-time payment on the RTP network are:

• 24/7 – The RTP^® network is live and operates 24/7. This allows financial institutions to send or receive payments at any time.
• Immediate Availability – Recipients receive the payment within seconds of the sending bank initiating the transaction. The RTP^® network receiving financial institutions are required to make funds available immediately, except for risk management or legal compliance purposes.
• Payment Certainty – Sending financial institutions (FI) are not able to revoke or recall a payment once it has been authorized and submitted to the RTP network. However, there is a process to facilitate FI-to-FI communication around return of funds sent in error.
• Ubiquity – All federally insured depository institutions can be RTP^® network participants, regardless of size.
• Extensibility – Rich, flexible messaging functionality is included to support value-added products. For example, the RTP^® network provides messaging that enables a request for payment of a bill or an invoice.
• Convenience – Customers of RTP^® network financial institution participants can initiate payments from their existing accounts.
• Cash Flow Control – The ability to send and receive immediate payments gives customers more control over cash flow, which may be particularly important for cash-constrained small businesses and consumers.
• Adaptability – The RTP^® network has a flexible architecture to adapt to changing market needs.

No, but your federally insured depository financial institution must be an RTP^® network participant.

No, the RTP^® network is designed to address unmet customer needs across all customer segments (B2B, B2C, C2B, P2P, A2A, G2C, etc.). Consumers, businesses, and the government can use the RTP^® network.

Today, RTP^® delivers efficient real-time payments for several use cases, including:

B2B

• A small business paying an urgent invoice in order to receive goods or services.
• A restaurateur who pays for farm-fresh produce from the local supplier to serve that evening's dinner specials.

B2C

• Insurance companies and healthcare plans pay claims with immediate confirmation.
• A retail bank distributing personal loan proceeds to a dealership on behalf of a customer who is at the showroom buying a new car.

C2B

• Consumer pays utility bill in response to Request for Payment from the biller.
• A busy working individual paying for general services around the house such as childcare provider, plumber or other repair service.

P2P

• College roommates splitting monthly rent and utility payments.
• A head of household sending emergency funds to a family member on vacation.

A2A

• A retail investor sending real-time money transfers to his or her investment account.

RTP^® allows for several B2B use cases and has the ability to move rich data (via ISO 20022 adoption) that can provide actionable insights into corporate client needs. Examples are as follows:

• Confirmation of payment
• Improved control over payments timing
• Liquidity management
• Instant bill payment
• Remittance data availability

No. RTP^® payments are not intended to be a wholesale replacement for any other payment type (ACH, Wire, Card or Check).

Instead, banks and their corporate clients are looking to types of services or activities that use one of these other networks that could benefit from the real-time and messaging characteristics of RTP^® payments to enhance or replace existing services—like real-time disbursements and reimagined bill payment.

The receipt of RTP^® payments does not require implementation by corporations as their bank will deposit funds into their accounts automatically. A company may want to integrate RTP^® payments received into its accounts receivable process, but it is not required. To send RTP^® payments, each company will be structured differently depending on their infrastructure and bank products.

No, the RTP^® network is strictly “credit push,” meaning that the person making the payment instructs its financial institution to make the payment. Credit push transactions reduce certain types of fraud risk.

The irrevocability of a payment sent over the RTP^® network enables immediate, final settlement to the payee, which is the key element of real-time payments.

No, the RTP^® network is not Same Day ACH. It is a separate and new infrastructure built for the digital age. RTP^® network payments clear and settle individually in real time with immediate finality. Same Day ACH payments are cleared in batches and settled after the payments clear.

Federally insured U.S. depository institutions have the option to directly connect to the RTP^® network. Depository institutions can connect also to the RTP^® network using an electronic connection provided by a third-party service provider (i.e.core processor, banker’s bank or corporate credit union). Contact your financial institution to see if they are connected to the RTP^® network.

The RTP^® network's Participation and Operating Rules apply to all network messages and are available on The Clearing House website.

Yes, the credit transfer limit on the RTP^® network is currently $1 million.

The FedNow^® Service is a new instant payment infrastructure developed by the Federal Reserve that allows eligible depository institutions of different sizes across the U.S. to provide instant payment services.

Through financial institutions participating in the FedNow Service, businesses and individuals can send and receive instant payments in real time, around the clock, every day of the year.

Financial institutions and their service providers can use the service to provide innovative instant payment services to customers, and recipients will have full access to funds immediately, allowing for greater financial flexibility when making time-sensitive payments.

The FedNow^® Service maintains uninterrupted 24x7x365 processing of credit transfers with security features to support payment integrity and data security. The service has a 24-hour business day each day of the week, including weekends and holidays. End-of-day balances are reported on Federal Reserve accounting records for each participating depository institution on each FedNow^® Service business day. Access to intraday credit is provided to participants in the FedNow Service during its business day under the same terms and conditions as for other Federal Reserve services.

The FedNow^® Service began operating on July 20, 2023.

As with all Federal Reserve Bank services, the FedNow^® Service is available to depository institutions eligible to hold accounts at the Reserve Banks under applicable federal statutes and Federal Reserve rules, policies, and procedures. Participants are able to designate a service provider or agent to submit or receive payment instructions on their behalf. Participants are also able to settle payments in the account of a correspondent, if they choose to do so. Merchants, consumers, or non-bank payment service providers can access the service through depository institutions as they do today with other payment systems.

The FedNow^® Service supports only domestic payments between U.S. depository institutions.

Account-to-Account (A2A)

• Corporate Cash Pooling – Corporations can consolidate funds into a single account for payroll or other purposes.

Consumer-to-Business (C2B) Bill Pay

• Pay Bills – Individuals and businesses can pay bills such as loans, utilities and more and feel confident their payment is posted to the biller’s account in seconds. This can help people and companies avoid late fees and better manage cash flow.
• E-Invoicing – Billers can send a request for payment to their customers through the FedNow^® Service. Customers can respond by initiating a credit transfer through an end-user interface offered by the financial institution. The payment will include the applicable remittance detail from the request which facilitates posting of the transaction.

Business to Business (B2B)

• On-Demand Payment – Businesses can free up working capital by paying suppliers upon receipt of products or services.
• E-Invoicing – Businesses can send an e-invoice and a request for payment that includes all the information they will need when their customer remits the requested payment.

Business to Consumer (B2C)

• One-Time Payments – Non-recurring disbursements such as insurance payouts or rebate claims can be paid instantly.
• Immediate Payroll – Payroll instructions for expedited payments can be initiated immediately rather than scheduled in advance.

Business customers can improve real-time money management and cash flow by using instant payments. Here are some examples of the scenarios for which instant payments are particularly useful:

• Small merchants who accept instant payments can receive the funds from these sales immediately, increasing cash on hand and potentially reducing the need for costly loans.
• A building contractor can more quickly obtain needed materials by instantly paying suppliers that require payment in advance of shipment.
• A utility company can send customers a request for payment and receive the funds immediately once the customer authorizes the payment. Because the responding payment can be linked to the original request, account reconciliation can be automated. Aside from significant savings from reduced manual processing, this enables faster posting of the payment and improves the customer experience.