An Automated Clearing House (ACH The ACH is a network of regional associations, inter-bank associations, and private-sector processors. ACH payments are processed and settled electronically, thereby increasing reliability, efficiency and cost effectiveness. ACH payments are generally settled in one day or greater.) transfer is the electronic transmission of a file which contains information pertinent to the movement of funds between accounts. An ACH transfer generally consists of multiple transactions and is referred to as a "batch An ACH batch consists of a template (see below) and a collection of transactions having the same purpose and effective date to be performed, and may also include addenda information.."
The steps for setting up and submitting an ACH batch are typically as follows:
1. Define participants (Participant The participant is the individual or organization that will be affected by the ACH transaction (payee or draftee). An ACH transaction may debit or credit a participant's account, e.g., a payroll deposit or a payment for services rendered. The participant information is referenced by the ACH transaction. Maintenance)
2. Define batch attributes (Batch Template The template contains the essential characteristics of the ACH batch, such as the name of the template, the type (class code) of ACH transmission (CCD The ACH payment format used for concentration of funds between or within companies. A single 94-character record contains the standard entry class indicating the type of transaction, routing and transit numbers of the ODFI Originating depository financial institution, The FI issuing an ACH file(s) on behalf of its client. and RDFI Receiving Depository Financial Institution, the FI that receives the ACH debits or credits on behalf of an individual, or business client. and the originator and receiver account numbers. CCD is the only corporate ACH format that does not have space for additional addenda information, but it does contain space for a reference number. or PPD Prearranged Payment or Deposit, the ACH payment format by which consumers may authorize credits or debits to their accounts by a company or financial institution. These are normally recurring payments in fixed amounts.), and the offset account. Although AXIS Cash Management only lists CCD & PPD, the application will create the appropriate CCD+/PPD+ ACH Batch if a participant with an addendum is associated with this batch. Maintenance)
3. Assign participants to the batch (Transaction An ACH transaction is an entry within the NACHA file that indicates how the participant's account should be affected. The transaction includes a reference to the participant, how the account is affected, and the amount. Entry Maintenance)
4. Submit the batch (Initiate Batch The Cash Management end user initiates an ACH batch by reviewing the transfer information and assigning a settlement date. Once all of the information is deemed correct by the user, the system creates a formatted NACHA file with all of the batch information.)
5. (Optional) Check on pending/recent activity (ACH Activity)
6. (Optional) Edit and re-submit the batch (Edit Batch)
The above steps are typical for an ACH user; for an ACH administrator, the main action occurs after batch submittal. If the batch requires approval for any reason (e.g., if it exceeds the user’s per-transaction or daily limits), it is given a status of Pending. The administrator then uses the ACH Admin/Approval Activity function either to approve the batch as-is or to deny it and send it back to the user for modification.
Note that a batch may be used many times once the setup steps (1-3) are completed. In fact, you will need to redo the setup steps only when something changes (e.g., you need to add new participants or remove old ones); in typical usage, simply submitting an ACH batch (as in step 4) will be sufficient. Note also that participants may be used in more than one batch.
A Word About Daily ACH Limits
The financial institution a bank, thrift, or credit union may set daily ACH limits for its commercial customers, and each company administrator the customer a bank's customer, a thrift's customer, or a credit union's member., or a person assigned by the customer, who will have administration responsibilities in the Commercial Customer Platform of the application. may set daily ACH limits for that company’s end users. As ACH batches and/or files are submitted to the financial institution, the Cash Management system keeps track of the daily limits and ACH totals.
If your company exceeds the limit set by the financial institution, you must contact the financial institution and request an extension of the limit in order to continue.
If the end user an employee of the customer that is given access to application by the company administrator or a user administrator. exceeds the limit set by the company administrator, the system checks the over-limit rules specified for your company. If the restrict option is checked, the user cannot initiate a transfer. If the require approval option is checked, the system marks the status as "Pending" and allow the transfer if it is subsequently approved by the company administrator or a wire administrator.