Introduction to ACH

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Company or individual that initiates an ACH transaction according to an arrangement with a Receiver .


The financial institution that deposits ACH files, on behalf of the Originator, into the ACH network.


The central clearing facility operated by a private organization or a Federal Reserve Bank on behalf of participating financial institutions, to or from which financial institutions transmit or receive ACH entries.


Natural person or organization that has authorized the Originator to initiate an ACH entry to the Receiver's account with the RDFI.


The financial institution that receives ACH entries from the ACH Operator and posts the entries to the account of its depositors (Receivers).


Processors that participate between any relationship within the ACH processing flow (i.e., correspondents, sending-point processors or payroll processors).

Two-digit code that indicates whether an entry is a debit or credit to a checking, savings, loan or financial institution general ledger account.

Three character code, such as Prearranged Payments or Deposits (PPD), used in an ACH header record to indicate the ACH format being used and to identify entries for proper application of rules.

The date an Originator enters on an ACH file to indicate the date they intend the transactions to post ( effective date ); and the date entries actually settle through the ACH Operator, as affected by the timing of delivery for processing.

A zero dollar entry sent prior to the first live entry to notify the RDFI of future payments and test account information. (Optional)

A payment message returned by the RDFI via the ACH network, which supplies data to the ODFI for the correction of payment information.

A record of information that may be attached to a detail entry record containing additional payment information (i.e., EDI messages, change and return information).