Business Owner Using ACH Origination

What to Know About ACH Originiation

February 21, 2023
by Team SESLOC

Interested in increasing your business’ efficiency? SESLOC is here to help with ACH (Automatic Clearing House) services. ACH Credit Origination allows business owners to pay employees with Direct Deposit and schedule electronic payments to vendors, and ACH Debit Origination allows the business to collect recurring payments from customers, such as rent or insurance. We’ve answered the most frequently asked questions about ACH Origination below:

How Do I Get ACH Services For My Business?

The business member who completes the Business Online Banking Application, referred to as the SESLOC Business Online Banking Administrator, can apply for Business Online Banking ACH Services. The Administrator may contact SESLOC Business Services at (805) 573-1816 or inquire online to apply, then our Treasury Manager will work with them.

What Are the Requirements for Business Online Banking ACH Services?

The business must:

  • Been in business for at least 2 years if Credit Underwriting is required.
  • Satisfactory FICO scores.
  • Other requirements may apply.

How Will I Be Notified If The Business is Denied Business Online Banking ACH Services?

If your ACH application is denied, you will be contacted by a SESLOC employee.

Are There Any Limitations to What Accounts I Can Send or Recieve Money To?

ACH Credit Origination can send money to a checking or savings account at a financial institution in the United States, and ACH Debit Origination can debit money from the customer’s checking or savings account at a financial institution in the United States.

What Types of Transactions Can Be Processed Through Business Online Banking ACH Services?

The following services can be processed:

  • Credit Business (CCD): Use this code to credit businesses.
  • Debit Business (CCD): Use this code to debit businesses.
  • Debit Consumers (PPD): Use this code to debit individuals.
  • Payroll Direct Deposit (PD): Use this code to credit individuals.
  • Telephone Authorized Collection (TEL): Use this code to debit consumers based on a telephone debit request.
  • Internet Authorized Collection (WEB): Use this code to debit consumers based on a request placed via internet.

What Are The ACH Transaction Limits?

Transaction limits are determined on a case-by-case basis. We will work with you to determine the exact limits for your business. Please note that transaction limits are calculated based on processing date (withdrawal date), not the date when the transaction was drafted or approved.

How Can I Stay Informed of Any Changes That May Affect Processing My ACH File?

As part of your ACH Agreement with SESLOC, you are required to stay up to date with industry changes. We recommend you reference for ACH rules changes.

How Are ACH Transactions Approved?

Every ACH transaction requires an approval code. You will obtain the approval code from a hard token (Security Token). The security token provides a 6-digit code that is used in SESLOC Business Online Banking to approve the ACH transaction(s). Each approver will have their own security token. Users with draft capabilities only will not have a security token.

Where Can I See Scheduled ACH Transactions in Business Online Banking?

Select Manage ACH from the main menu bar. Past ACH transactions will be listed in the History tab, and upcoming ACH transaction templates will be listed in the Scheduled tab. Scheduled templates can be canceled prior to processing by clicking the template and selecting the Cancel Template button.

What is the Cut-off Time For Processing ACH Transactions?

Transactions must be submitted prior to 3:00 p.m. on a business day to be included in that day’s processing.

What Are the Fees?

The fees associated with Business Online Banking ACH Origination are located in the Business Services Fee Schedule.

What Do the Terms Mean?

  • ACH (Automated Clearing House): The primary system that agencies use for electronic funds transfer.
  • ACH Credit: A withdrawal from the SLESOC account.
  • ACH Debit: A deposit to the SLESOC account.
  • ACH Operator: The central clearing facility (either the Federal Reserve Bank or the Clearing House) that receives entries from ODFIs, distributes the entries to RDFIs and performs settlement functions.
  • ACH Pass Thru: ACH Pass Thru is used to load and submit properly formatted NACHA-format files. The file can contain one or more batches, both debit and credit batches and multiple SEC Codes.
  • CCD (Corporate Crdit or Debit): Used for transfers between business accounts (Business to Business).
  • EPN (Electronic Payments Network): An electronic automated clearing house (ACH) that services as the sole ACH for the private sector in the United States.
  • NACHA (National Automated Clearing House Association): The national organization that maintains the operating rules, standards and procedures that govern all ACH activities and procedures.
  • ODFI: Originating Depository Financial Institution
  • Originator: The person or organization that has authorized an Originating Depository Financial Institution (ODFI) to transmit a credit or debit entry to the account of a receiver with a Receiving Depository Financial Institution (RDFI).
  • PPD (Prearranged Payment and Deposit Entry): A prearranged entry to or from a consumer account, for example, direct deposit of payroll (Business to Consumer or Consumer to Consumer).
  • Prefunding: Prefunding requires that the funds be available in the SESLOC account on the day the transaction is scheduled and processed. All ACH Credit transactions being sent out of SESLOC will be pre-funded.
  • RDFI: Receiving Depository Financial Institution
  • Receiver: An individual, corporation, or other entity that has authorized an originator to initiate a debit or credit ACH entry to an account held at a Receiving Depository Financial Institution.
  • SEC (Standard Entry Class) Code: Standard Entry Class code required by NACHA rules for every ACH transaction.
  • The Clearing House Payments Authority: The association designed to provide payment system support and education for payment professionals.