DirectPay ACH


Frequently Asked Questions


What is an ACH file?

ACH is an acronym for "Automated Clearing House". The 'automation' refers to the handling of the transactions by computers as opposed to humans. The ACH is used as an alternative to physical (paper) checks and other labor-intensive and labor-intensive money transfers.

In the United States, most banks use ACH files that are formed in a standard format. This format is called the "NACHA" (National Automated Clearing House Association) Format, named after the regulatory body that oversees the American ACH network.

Who is DirectPay ACH designed for

Anyone trying to send or receive payments electronically to US Bank Accounts. Our users range from construction companies paying payroll to churches collecting donations - and everything in between.

What are the technical requirements?

DirectPay ACH is officially supported on Windows XP, Vista, 7, and 8 with a suggested minimum hardware requirement of a Pentium 4 processor with 512 MB of RAM and 20 MB of free Hard Drive space. If your computer was purchased in the last 10 years, you likely meet this suggested minimum.

Why do I need software to send money?

Your bank will require you to provide them the transactions you wish to process. Often, they will provide a website that allows you to manually enter transaction information. This can be time consuming. Often, financial institutions offer a website which allows the import of a data file of their choice. Getting your transactions into their format is its own challenge.

DirectPay ACH is a standalone Windows Application which allows for a quick and easy creation of your ACH Payment and Collection Files. Since ACH is a standard format, your bank should be able to receive your file and know exactly what to do with it. There is no rekeying of the data so its integrity is maintained and your time is saved.

Can this save my company money?

Yes, depending on the fees your bank (or FI) charges you, ACH can save you money. Most ACH processors charge a flat fee per transaction, batch, and/or file. This means unlike credit cards, there is usually no percentage fee charged. When dealing with high-dollar transactions significant savings can be realized.

What do I need to start processing transactions?

To processing transactions, you'll need either a bank or a "third-party ACH processor" (TPP). We will refer to your processor as your "FI" or "Financial Institution". This organization will present your transactions to the ACH network. Only financial institutions may present items into the network, so you will need one.

After establishing an "ACH Processing Account" with your FI, you can start signing up your participants. In order to credit or debit anyone other than accounts you own, you will need preauthorization from each participant. This preauthorization can come in the form of written, electronic, or voice-recorded consent. Please consult with your FI for more details on the authorization requirements.

With your purchase of DirectPay ACH, we will optionally provide you 3 customizable documents that you may gather written consent with (Paycheck Direct Deposit, Vendor Payment, and/or Customer Collection). Just send us an email and we'll shoot them over!

Does DirectPay ACH actually send the money?

No, DirectPay ACH creates a payment instruction file that you can give to any bank or payments processor that supports the ACH format (most do). This is the same format in which your bank sends the file to the Federal Reserve Bank in.

What "Entry Classes" does DirectPay ACH support?

PPD+ and CCD+ both with an optional addenda record. If you don't know what this means, there is likely no reason to worry about it. These entry classes cover a large majority of ACH transactions.

Common PPD+ uses include: Payroll Direct Deposit, Customer Collections from Consumers, Social Security or SSI Payments, Expense Reimbursements, Membership Dues Collections, Loan Collections, Utility Bill Collections.

Common CCD+ uses include: Vendor Payments, B2B Customer Collections, Tax and Child Support Payments, Funding Investment/Retirement Accounts, and Consolidation of Funds.

What is the ACH?

ACH is an acronym for "Automated Clearing House". This is the system the Federal Reserve Bank maintains that facilitates the transfer and settlement of transactions, electronically.

What is NACHA?

NACHA is an acronym for the "National Automated Clearing House Association". NACHA sets the rules that govern the ACH network and dictate the format the files should be in. The terms "ACH File", "NACHA-Formatted File", and its variations are used interchangeably.

How is this different from online bill pay?

Bill pay sends consumer-to-business transactions via ACH or physical check, depending on the recipient. ACH transactions allow sending AND receiving money from business or consumer bank accounts. With ACH, no checks are ever physically sent anywhere and everything is settled electronically.

Can I charge credit cards with DirectPay ACH?

No, the ACH network is completely seperate from the credit card networks.

More questions?

Get in touch with our support team. Contact Us.