ACH Implementation Guide

ACH Commerce, LLC 8920 B Transport Lane, Suite 1 Ooltewah, TN 37363 800-724-8780 Toll Free
423-238-5187 Fax

TABLE OF CONTENTS

ACH PARTICIPANTS .......................................................................... 4 ACH TRANSACTION TYPES ............................................................ 5 TRANSACTION CREATION & DELIVERY OPTIONS................ 9 SENDING A FILE FOR PROCESSING........................................... 15
AUTHENTICATION AND VERIFICATION SERVICES ................. 17

AUTHORIZATIONS & DISCLOSURES......................................... 19 TIMING................................................................................................. 22 MANAGING ACH RETURN ITEMS............................................... 25 RETRIEVING YOUR RETURN FILES........................................... 26 REPORTS & SPECIAL SERVICES ................................................. 28 CONTACT INFORMATION ............................................................. 30

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INTRODUCTION
Thank you for choosing ACH Commerce, LLC as your ACH service provider. We are dedicated to providing you with excellent customer service throughout our relationship. We have created numerous tools and methods to allow you to create and transmit a variety of ACH transactions. The implementation guide will introduce each transaction creation and delivery option in order to help you determine which method will work best for your business. This guide will also: Introduce the participants of the ACH network Describe the various types of ACH transactions Introduce authorization and disclosure requirements Introduce the current authentication and verification tools offered by ACH Commerce Provide samples for each authorization and disclosure requirement Address timing of transaction delivery, returns and settlement Explain the various file creation and transmission methods offered by ACH Commerce Provide instructions to securely send and receive information to ACH Commerce Discuss ACH returns Provide sample reports and confirmations Present special services offered by ACH Commerce Provide ACH Commerce contact information

If you have any questions when reviewing the guide, please feel free to contact us via telephone at 423-238-5184 or via e-mail at support@achcommerce.com. We look forward to a long and mutually beneficial relationship.

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ACH PARTICIPANTS
Originator (Your Company) The originator is the entity that agrees to initiate ACH entries into the payment system according to an arrangement with a Receiver. The Originator is usually a company directing a transfer from a consumers or another companys account. Third Party Service Provider -(ACH Commerce, LLC) The entity that acts as the collection point for transactions created by the Originator and then forwards the transactions to the ACH Operator on behalf of the ODFI. Originating Depository Financial Institution -(ODFI) The ODFI is the financial institution that warrants all transactions created by the Originator that are forwarded to the ACH Operator. ACH Operator -(Federal Reserve Bank) An Automated Clearing House (ACH) Operator is the central clearing facility operated by EPN or the Federal Reserve Bank. The ACH Operator performs the settlement function and transaction delivery between ODFIs and RDFIs. Receiving Depository Financial Institution (RDFI) -(Your Customers Bank) The Receiving Depository Financial Institution is the financial institution that receives ACH entries from the ACH Operator and posts the entries to the accounts of its depositors (Receivers). Receiver (Your Customer)- A Receiver is a natural person or an organization that has authorized an Originator to create an ACH entry to their account with the RDFI. A Receiver may be either a company or a consumer, depending on the type of transaction. NACHA (National Automated Clearing House Association)-The entity that governs the framework and the Rules of the ACH network. All participants are obligated by legal agreement to abide by the Rules set forth by NACHA.

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ACH TRANSACTION TYPES

ACH transaction types are easily identified by (SEC) or Standard Entry Class Code. Proper use of SEC codes is crucial in insuring that your company and the ODFI are in compliance with NACHA rules. Each SEC code has different rules, authorization and/or disclosure requirements. Samples can be found in the section entitled Authorizations & Disclosures. Below you will find a list of transaction types, (with referenced SEC code), that are supported by ACH Commerce, LLC. Direct Debit & Direct Deposit = (PPD-Prearranged Payment/Deposit) Direct Debit-Your company (Originator) may debit the account of your customer (Receiver) for goods or services as they become due, provided you have obtained written authorization from your customer. Direct Deposit-Your company (Originator) may credit the account of your employees or customers (Receiver) for payroll, interest, dividends or pensions. Although written authorization is not required, it is recommended as a method of obtaining valid routing and account numbers. This type of transaction can only be submitted to Consumer accounts. Corporate Collection/Payment = (CCD Corporate Cash Deposit/Disbursement) CCD-Your company (Originator) can collect, distribute or consolidate funds between corporate entities provided that you have obtained written authorization or have an agreement in place with the corporate entity. This type of transaction can only be submitted to Corporate accounts. Check Conversion-Mail In/Drop Box = (ARC-Accounts Receivable Conversion) ARC-Your company (Originator), may convert checks received by mail or in a drop box from your customers (Receivers) into ACH items, provided that you: o Properly disclose this practice on your invoice, statement or agreement o Retain an image of the front and back of the check for 2 years o Destroy the paper item after 14 days o DO NOT convert Corporate Checks, Money Orders, Cashiers Checks or Third Party Checks Check Conversion-In Person = (POP- Point of Purchase Check Conversion) POP-Your company (Originator) may convert checks presented in person by your customers (Receiver) into ACH items, provided that you: o Capture MICR information with an electronic device o Void the check and give back to the customer upon receipt o DO NOT convert Corporate Checks, Money Orders, Cashiers Checks or Third Party Checks

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Telephone Check = (TEL-Telephone Initiated Entry) TEL-Your company (Originator) can accept payments over the phone from your customers (Receiver) using their savings or checking account information when there is either; o An existing relationship between your company (Originator) and your customer (Receiver). o No existing relationship between the Originator and Receiver, but the Receiver has initiated the telephone call. o Oral authorization is obtained via recording or notice is sent prior to debit entry posting to customers account. o TEL entries are for one-time payments, recurring payments authorized in this manner are not permitted. On-Line Check Acceptance = (WEB-Web Initiated Entry) WEB-Your company (Originator) can accept payments, both single or recurring, over the Internet from your customers (Receiver) using their savings or checking account information provided that you; o Obtain electronic authorization by posting of appropriate disclosure on the site. o Have incorporated commercially reasonable authentication and verification methods. o Are providing a secure session for the transaction. Electronically Collect NSF Paper Checks = (RCK-Returned Check Re-Presentment) RCK-Your company (Originator) can collect paper checks that have been returned for NSF or Uncollected funds by creating an ACH item provided that you; o Post signage at the point of sale indicating that if a check is returned it will be collected electronically. o Initiate the item for the face value of the check only o DO NOT DEPOSIT the paper item after you have created an electronic item. o DO NOT attempt to collect Corporate Checks electronically NSF fees may be collected electronically, however the NSF fee must be created as a PPD entry and written authorization must have been obtained at the point the check was presented. The following quick reference guides are designed to provide additional information regarding POP, RCK, ARC, TEL & WEB entries.

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POP, RCK, ARC Reference Chart-Operations

Point-ofPurchase Standard Entry Class Code POP RCK Re-presented Check ARC Accounts Receivable

Description of the electronic check transaction

Check voided by merchant and returned to consumer. A one-time ACH debit entry to a Receivers account for inperson purchases made at the point-of-purchase. Check Serial Number, Terminal City and Terminal State, Terminal Location. Consumer. They received it back at time of purchase. Merchant should stamp the check void Determined by consumer.

NSF check or uncollected funds re-presented electronically.

What prints to the consumers statement?

Who retains the check?

REDEPCHECK Company Entry Description of the Company/Batch Header Record Company name and check number Company to which check was written. Originator must be able to provide a copy of the front and back of the source document for 7 years. Originator not required to retain the original check Less than $2,500 Consumer NSF checks under $2,500 First party checks only. Once as check, twice as ACH or twice as check, once as ACH. Yes, as a separate PPD transaction with authorization. Signage or written notice at time of payment. Affidavit required Follow error resolution procedures. 60 days from settlement date. (Not Reg E)

Check mailed to biller for payment. A one-time debit entry to a consumers account initiated by an Originator for purchases or payments that are made by mailing a check via U.S. mail or placing in a drop box. Check Serial Number

Biller to which check was mailed.

How long is the check retained?

Dollar limit? Eligible Items

No limit Consumer checks First party checks only. Must contain a pre-printed serial number. Three presentments Yes, as a separate APPD transaction with authorization. Authorization receipt signed at time of purchase. Affidavit required Follow error resolution procedures. 60 days from statement date. (Reg E)

Number of presentments Can a return fee be charged? Authorization requirements If consumer claims not authorized If consumer claims error in transaction (improper entry) How much time does consumer have to dispute transaction? What Return Reason Codes should be used for: Unauthorized Authorization Revoked Are Stop Payments allowed? What if there is a Stop Payment on a check and it comes in as ACH? What happens if the source document and ACH entry are both presented for payment. Legal Framework

Source document must be destroyed within 14 days. Copy of front and back of source document must be retained for a period of two years from the Settlement Date of Entry. No limit Consumer checks First party checks only. Must contain a pre-printed serial number, must be completed and signed by consumer Three presentments Yes, as a separate PPD transaction with authorization. Notice must be provided to Receiver. Affidavit required Follow error resolution procedures. 60 days from settlement date. (Not Reg E)

R10 or R37 Cannot revoke Yes, prior to posting of item. Return R08 within 2 days. No extended Return Time Frame. Return R37 within0 days of settlement date NACHA Rules, Electronic Fund Transfer Act and Regulation E

R51 Cannot revoke Yes, prior to posting of item. Return R52 within 2 days. Return R52 within 60 days of settlement date. Return R53 with 60 days of settlement date NACHA Rules, Uniform Commercial Code and Federal Reserve Regulation CC

R10 or R37 R07 Yes, prior to posting of item. Return R38 within 2 days. Return R08 within 60 days of settlement date. Return R37 within 60 days of settlement date. NACHA Rules, Electronic Fund Transfer Act and Regulation E

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WEB and TEL Reference Chart Operations

Standard Entry Class Code

Description of the transaction What prints to the consumers statement? Addenda Formatting Requirements How many transactions does this authorize? How long is the authorization retained? Dollar limit? Number of presentments Authorization requirements

Internet-Initiated Entry WEB

Transaction authorized on the Internet. Used for origination of debit entries (either recurring or single entry) Descriptive word and Company name WEB entry may be accompanied by one optional addenda record R or S is placed in Payment Type Code Field of Entry Detail. Consumer can authorize single or recurring entry. Two years following transaction or termination. No limit No limit Must authenticate consumer and signify assent. Must be in a writing that is signed or similarly authenticated, must clearly and conspicuously state its terms and for recurring payments must state a way to revoke the authorization. Affidavit required. Follow error resolution procedures. 60 days from statement date. (Reg E) R10

Telephone-Initiated Entry

TEL
A single entry consumer debit transaction authorized by telephone. Descriptive word and Company name TEL entries cannot carry addenda

Consumer authorizes single entry only. Two years from date of authorization. No limit No limit Must be recorded or notification provided to consumer. Signed or similarly authenticated. The Originator must ensure that the required specific information is disclosed to the consumer during the call (Information provided on page OG82 of the 2002 ACH Rule Book. Affidavit required Follow error resolution procedures. 60 days from statement date. (Reg E) R10 Cannot revoke

If consumer claims not authorized If consumer claims error in transaction How much time does consumer have to dispute transaction? What Return Reason Codes should be used for: Unauthorized

Cannot revoke single entry (S contained in Entry Type field) Yes, prior to posting of item. Return R08 within 2 days of settlement. NACHA Operating Rules and Regulation E

Authorization Revoked Are Stop Payments allowed? Legal Framework

Yes, prior to posting of item. Return R08 within 2 days of settlement. NACHA Operating Rules, Regulation E

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TRANSACTION CREATION & DELIVERY OPTIONS Transaction Creation

ACH Commerce provides a variety of web-based applications to create and deliver ACH transactions. These are ACHStation, which supports PPD, CCD and TEL entries for one time, recurring and batch transactions and MobileScan which supports creation of ARC, POP and RCK transactions. User documentation for these products can be found at http://www.achcommerce.com/support. However, if your system can create an ACH formatted file, simply deliver it to us for processing. If your system can export data, send it to us and we can provide conversion assistance. ACHStation ACH Commerce provides a solution for companies that want to create single, recurring or a batch of transactions. Our Web Based Entry solution allows a user or multiple users to effortlessly enter basic customer information to initiate ACH transactions. ACHStation is located at gateway.achcommerce.com

ACH Mobile Scan MobileScan is a web based check conversion application hosted by ACH Commerce. MobileScan allows companies to convert paper checks into ACH, image items and capture remittance data using a Mag-Tek or RDM scanning device. ACH Commerce can provide the company with ACH processing services through the Federal Reserve Bank, or simply provide an ACH formatted file for processing through their own financial institution. ACH Format Most payroll systems can generate a direct deposit file in ACH format. Some accounting systems have this capability to generate direct debit entries. For companies that opt to use this format, specifications for file creation can be found in the ACH Rule Book available for purchase at www.nacha.org ACH Commerce can support conversion of data received in Pipe Separated Value format into ACH format for processing. A sample of this format is shown below:

PSV Format

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PSV Origination File Format Fields are pipe-separated ( | ). Other field separators are possible and are handled on a perrequest basis. Records may be separated by a CR (Carriage Return), LF (Line Feed), or both.
Field Name Customer ID Customer Name Originator ID Originator Name Transaction Nature Frequency Field Length 10 23 10 16 1 10 Format Alphanumeric Alphanumeric Alphanumeric Alphanumeric Alphanumeric Alphanumeric Required? Yes Yes Yes Yes Yes No Comments ID assigned by ACH Commerce. This must be consistent in all records in a file. Name of Customer. This must be consistent in all records in a file. The ID of the originating company or organization. A file may contain transactions for different Originators. Name of company or organization responsible for the transaction. If the Customer and Originator are the same, a customer service phone number should be placed here. S=Single, R=Recurring, B=Batch Some Transaction Types(SECC) do not allow Recurring (Examples: TEL, ARC, RCK, POP) If Nature is Recurring, the frequency. MO Monthly WK Weekly FN Fortnightly YR Yearly BM Bi-Monthly If Nature is Recurring, the total number of transactions. If left empty, the transactions will continue forever; until cancelled. If Nature is Batch, the name of the batch to which the transaction belongs or is to belong. C=Create, R=Remove, U=Update Update does not apply if the Nature is Single. Remove may only be used for a Single transaction if the transaction has not already been pulled for processing. The transaction type as defined in the NACHA ACH Rules as a Standard Entry Class Code. Examples: PPD Consumer payment or collection, written authorization. CCD - Corporate Collection or Deposit WEB - Web-Initiated single or recurring Consumer Payments

Number of Occurrences Batch Name Transaction Action Transaction Type (SECC)

4 15 1

Numeric Alphanumeric Alphanumeric

No No Yes

Alphanumeric

Yes

TEL Telephoneauthorized one-time Consumer payments

RCK Re-presentment of Consumer paper checks POP Point-of-purchase conversion of Consumer paper check to electronic item ARC Conversion of Consumer check received other than at point-of-purchase. A description of the reason for the transaction. Examples: PAYROLL, DUES, FEES, TVORDER. The date the transaction is intended to post to the individual or company account. For recurring transactions, the intended posting date of the first occurrence.. This field is used to identify the individual or company

Description Effective Date Individual

10 6

Alphanumeric YYMMDD

Yes Yes

15

Alphanumeric

Depends on

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ID

SECC

Name Routing# Account# Account Action Account Type Amount Check # Terminal City Terminal State Transaction ID

22 9 17 3

Alphanumeric Numeric Alphanumeric Alphanumeric

Depends on SECC Yes Yes Yes

Alphanumeric

Yes

11 9 4 2 20

Numeric Numeric Alphanumeric Alphabetic Alphanumeric

Yes Depends on SECC Depends on SECC Depends on SECC Depends on Action

being debited or credited. Examples might be a persons account number at a utility company, or the number of an invoice being paid. This is not required for POP,RCK, and ARC transactions. Name of the individual or company being debited or credited. This is not required for POP and ARC transactions. Routing/ABA number of the individual or company bank. Must be 9 characters in length. The account number at the individual or company bank that is to be debited or credited. DR Debit (Collect) CR Credit (Pay-out) DRP Debit Pre-Note CRP Credit Pre-Note CK Checking SV Savings GL General Ledger LN Loan Amount may include only 2 decimal places. The amount must be zero for Actions DRP and CRP and cannot be zero for CR or DR. The Check number as captured for RCK, ARC, and POP transactions. Not required for other SEC. An abbreviation for the city where the Point-of-Sale terminal is located. Required for POP transactions. The two-character abbreviation for the state where the Point-of-Sale terminal is located. Required for POP transactions. The unique ID assigned to this transaction by the Customer or Originator. This can be used to maintain a unique tracking mechanism between Originated and Return files.

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Transaction Delivery
ACH Commerce, LLC provides two secure methods for transaction delivery. ACHTransit If your company would like to take advantage of real-time transaction delivery and verification, ACHTransit is our solution for server-to-server communication via secure HTTPS post. Detailed specifications for ACH Transit can be found at http://www.achcommerce.com/support ACHTransport allows you to upload your electronic files, either ACH formatted or exported data files, to ACH Commerce via the Internet using secure FTP transmission. Electronic return files will also be downloaded using this same method. Complete documentation for using this method of transmission and obtaining return files can be found in the Guide to Managing ACH Returns or at http://www.achcommerce.com/support.

ACH Transport

Electronic files must be accompanied by a transmittal form when using ACHTransport.. Please remember to email a completed transmittal form to processing@achcommerce.com anytime you submit an electronic file for processing. A sample transmittal is shown below:

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Delivery Confirmation
Confirmation notices will vary depending upon the transaction creation or delivery method used. A description and sample of each are shown below: Transactions sent using ACHTransport or ACHTransit will receive the following confirmation notice.

Transactions created using ACHStation will receive the following confirmation notice.

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Once your file has been processed you will receive a notice detailing the types of transactions processed, effective entry date, settlement date, transaction types and amounts as shown below:

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SENDING A FILE FOR PROCESSING

ACHTransport Login Instructions
Initiate a connection to the Internet from your computer. Go to https://achtransport.achcommerce.com using your preferred web browser. You will be directed to the Login screen shown below:

A secure login and password will be provided by ACH Commerce. Type this information in the appropriate fields shown. Click the Login button or press enter on your keyboard This will bring you to the Main Screen of ACHTransport as shown below:

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Uploading (Sending) a File to ACHTransport

Once youve signed in to ACHTransport, you have the ability to send and receive secure information to ACH Commerce. Click the folder that corresponds to the type of file you are uploading. (Example: If you are sending a file to ACH Commerce for processing, you will choose the Tranfile folder.) Click the Add File icon located in the upper right hand corner of the main screen. The prompt shown below will allow you to choose the file you wish to upload.

Click the Browse button to navigate to where the file is stored on your computer or simply type in the path and filename. Then click the Add button to upload your file.

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AUTHENTICATION & VERIFICATION SERVICES

Overview
ACH Commerce understands the risk involved with accepting checks electronically. We provide a variety of tools designed to perform commercially reasonable check validation and buyer authentication. Based on the risk profile of your particular business, ACH Commerce can supply the right combination of tools to create a secure environment for you and your customer. These tools include: Routing Number Validation Account Number Validity Check & Status

Product Descriptions ACH MatchTrac: This service is designed to verify the validity of a bank routing number.
ACH Commerce provides this service through a partnership with the entity that issues routing numbers to financial institutions and maintains the most current information regarding routing number status in a central database. This service is available in real-time or by filtering batches prior to processing and can be utilized by all of our data collection and transmission methods. Features: Allows lookup of bank name by routing number Quickly identifies data entry errors of routing number Identifies inactive or retired routing numbers due to bank merger or acquisition Identifies financial institutions with valid routing numbers that do not accept ACH transactions Identifies credit unions and financial institutions whose rules do not allow debit or credit ACH transactions to post to savings or checking accounts Available in real-time or batch filtering Benefits: Reduces administrative returns, allowing you to identify bad routing numbers and enables you to make the correction at the point of acceptance instead of after the sale Reduces cost associated with administrative return items

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ACH VeriTrac: This service also verifies the validity of routing numbers but is enhanced
by the ability to verify that the account number is recognized as an open account and is not currently in overdraft status. Approximately 70% of the financial institutions contribute to this national database and the number is growing daily. This product can be combined with our other verification products and utilized by all of our data collection and transmission methods. Features: Recognizes items drawn on closed accounts Recognizes items drawn on accounts currently in overdraft status Identifies inactive or retired routing numbers due to bank merger or acquisition Identifies financial institutions with valid routing numbers that do not accept ACH transactions Available in real-time or batch filtering Benefits: Reduces Account Closed and NSF returns Allows your company to recognize potentially fraudulent transactions Reduces cost associated with return items and collections

ACH VeriTrac Express: An alternate method of utilizing ACH Commerces Veritrac

product. This web-based application is ideal for single verification of your customers accounts. Customer Service Representatives can simply enter the routing and account number of a potential customer into the web-based form for real-time verification of the account status.

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AUTHORIZATIONS & DISCLOSURES

o PPD Debit Sample Authorization AUTHORIZATION AGREEMENT DIRECT PAYMENTS (ACH DEBITS) I (we) hereby authorize _____________________________________, hereinafter called COMPANY, to debit entries to my (our) account indicated below and the Financial Institution named below, hereinafter called FINANCIAL INSTITUTION, to debit same to such account. I (we) acknowledge the origination of ACH transactions to my (our) account must comply with the provisions of U.S. law. ___________________________________________________ (Financial Institution) (Branch) ______________________________________________________________________________ (Address) (City-State) (Zip) _____________________ (Routing/Transit Number) ___________________ (Account Number) ___Checking ____ Savings (Account Type)

Recurring Amount________/ Range: Minimum__________Maximum____________ This authority is to remain in full force and effect until COMPANY has received written notification from me (or either of us) of its termination in such time and manner as to afford COMPANY and FINANCIAL INSTITUTION a reasonable opportunity to act on it. _________________________________________ (Print Individual Name) _________________________________________ (Signature) ________________________ (Individual ID Number) ________________________ (Date)

PLEASE ATTACH COPY OF VOIDED CHECK TO THIS FORM

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o PPD Credit Sample Authorization AUTHORIZATION AGREEMENT DIRECT PAYMENTS (ACH CREDITS) I (we) hereby authorize _____________________________________, hereinafter called COMPANY, to credit entries to my (our) account indicated below and the Financial Institution named below, hereinafter called FINANCIAL INSTITUTION, to debit same to such account. I (we) acknowledge the origination of ACH transactions to my (our) account must comply with the provisions of U.S. law. ___________________________________________________ (Financial Institution) (Branch) ______________________________________________________________________________ (Address) (City-State) (Zip) _____________________ (Routing/Transit Number) ___________________ (Account Number) ___Checking ____ Savings (Account Type)

Recurring Amount________/ Range: Minimum__________Maximum____________ This authority is to remain in full force and effect until COMPANY has received written notification from me (or either of us) of its termination in such time and manner as to afford COMPANY and FINANCIAL INSTITUTION a reasonable opportunity to act on it. _________________________________________ (Print Individual Name) _________________________________________ (Signature) ________________________ (Individual ID Number) ________________________ (Date)

PLEASE ATTACH COPY OF VOIDED CHECK TO THIS FORM

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ARC Sample Disclosure

Accounts Receivable Check Truncation Notice Checks received by mail or in our drop box will be converted to an ACH debit item. The check number, amount and payee will appear on your monthly bank statement in lieu of a cancelled check.
o

POP Sample Authorization

Point of Purchase Check Conversion Authorization I authorize the merchant to convert my check and debit my account for the sale amount via ACH. In the event that the ACH item is returned unpaid, I agree to pay and have my account debited electronically for a returned item fee of _________. Questions may be directed to ________________. Signature:___________________________
o

RCK Sample Disclosure & Authorization

RCK Signage & NSF Fee Authorization In the event your check is returned unpaid for insufficient or uncollected funds, it may be redeposited electronically for payment. If the merchant intends to assess a returned check fee electronically, they are required to have the consumer sign a written authorization, which may be stamped on the back of the check. In the event this check is returned, I hereby authorize the merchant to debit my account for a returned check fee of $___________.
Signature:___________________________ Phone: ______________________

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TIMING
Origination Timing
The ACH rules govern timing of transaction delivery to the ACH Operator and timeframes for returning an item for NSF or Unauthorized. Timing of Settlement entries to your companys (Originator) account is typically determined by the ODFI based on a risk evaluation conducted through the underwriting process. It is important to note that numerous dates and times are often referred to when processing ACH items. These are outlined below: 1. Cut-Off Time: The daily time established as a deadline to insure transactions are processed that day. Your cut-off time for processing is established in your ACH Origination Agreement. Files submitted after the cut-off time are not processed until the next processing day unless. Processing of late files is permitted but late file fees are assessed upon approval. 2. Process Date: The date transactions received by the cut-off time are processed and forwarded to the ACH Operator by the Third Party Service Provider or ODFI. 3. Effective Entry Date: The date your company (Originator) intends payment or collection to post to your customers (Receiver) account. Effective entry dates may be adjusted if they are stale dated, fall on a holiday or weekend. The diagram below illustrates the Process and Effective Entry Dates.

Monday Process Date

Tuesday Effective Entry Date

Wednesday

Thursday

Friday

(File sent to ACH (Transactions post to Commerce for Processing) Receivers accounts)

4.

Non Processing Holidays

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5. Settlement Date: The date your company (Originator) is debited or credited for the sum of ACH transactions processed for a particular day. This date varies and is negotiated during the underwriting process. Your settlement date is established in your ACH Origination Agreement. Since your customers/employees banks (RDFIs) use different processing systems, the ACH network requires specific timing of transactions to be considered when transmitting these entries to the ACH Operator. These rules are as follows: Credit Transactions are to be delivered by the deadline of the process date at least two business days prior to the Effective Entry Date of the transactions. Debit Transactions are to be delivered by the deadline of the process date at least one business day prior to the earliest Effective Entry Date of the transactions within the file.

Return Timing
The ACH network requires your customers banks (RDFI) to return all entries by the opening of the second business day following the effective entry date of a transaction, with the exception of Revoked or Unauthorized transactions which can be sent back for a period of 60 days following the effective entry date of a transaction. More detailed information regarding the format of electronic return items that will be provided and return reason codes can be found in the Guide to Understanding ACH Returns which may be obtained by contacting an ACH Commerce representative.

Settlement Timing & Types

Timing of settlement is determined by the Third Party Service Provider or ODFI based on a risk evaluation conducted during the underwriting process. Timing of settlement can occur as follows: 1. Same Day Settlement-is when your company (Originator) is debited or credited for the sum of transactions on the same day as the effective entry date of transactions processed to your customers (Receiver) account. Example: Your customers are debited on the 10th of the month, funds are deposited into your account on the 10th of the month. 2. Delayed Settlement-is when your company (Originator) is debited or credited for the sum of transactions after the effective entry date of transactions processed to your customers (Receiver) account. Delayed settlement can be up to 5 business days. Example: Your customers are debited on the 10th of the month, funds are deposited into your account on the 15th of the month. The illustration below shows the flow of each settlement type.
Monday Process Date Tuesday Effective Entry Date
Same Day Settlement Occurs 1-Day Delay 2-Day Delay 3-Day Delay Settlement Occurs Settlement Occurs Settlement Occurs

Wednesday

Thursday

Friday

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3. Pre-Funding-is when your company (Originator) is debited for the sum of credit transactions prior to the effective entry date of transactions to be credited to your customers/employees (Receiver). The illustration below details a 1-day pre-funding scenario.
Monday Tuesday Wednesday Thursday Friday
Effective Entry Date for Payroll Credits.

Payroll File is sent Your account is The payroll to ACH Commerce. debited for the credits are sent out total amount of the to your employees. payroll file.

4. Net Settlement-is when your company (Originator) is debited or credited for the sum of transactions due on a delayed settlement date, minus return items received for those transactions, late returns for previously settled transactions, reserves and fees. A sample of a net settlement report is shown below: Net Settlement Report Sample:

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MANAGING ACH RETURN ITEMS

ACH Commerce will provide information on return items on a daily basis. You may elect to receive a return item report or receive your return items in electronic format. A sample of a report is shown below:

Electronic return files can be sent in ACH format or Comma Delimited format. The ACH Return format can be found in the ACH Rules Book. A sample of the Comma Delimited Return format is shown below:

More detail on how to effectively manage ACH returns can be found in the Guide to Managing ACH Returns. To obtain a copy, please go to http://www.achcommerce.com/support.

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RETRIEVING YOUR RETURN FILES

ACHTransport Login Instructions
Initiate a connection to the Internet from your computer. Go to https://achtransport.achcommerce.com using your preferred web browser. You will be directed to the Login screen shown below:

A secure login and password is provided by ACH Commerce. Type this information in the appropriate fields shown. Click the Login button or press enter on your keyboard. This will bring you to the Main Screen of ACHTransport as shown below:

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Downloading (Receiving) a File from ACHTransport

Once youve signed in to ACHTransport, you have the ability to send and receive secure information to ACH Commerce. Click the folder that corresponds to the type of file you are going to download. (Example: If you are downloading your return file, you will choose the Retuns folder.) After clicking on the appropriate folder, you will see a list of files that you can download onto your computer. The image below illustrates what you will see:

Windows users should right click on the file and choose Save Target As to

download a file. MAC users should Control-click or click and hold onto the file you wish to download. Choose the location on your computer where you wish to save or download the file.

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REPORTS & SPECIAL SERVICES

ACH Commerce provides two additional reports upon request. These are the Customer Activity Summary Report (useful for monthly reconcilement) and Return Reason Code Summary (useful in analysis to reduce return item fees). These reports can be provided on a monthly basis for an additional fee of $15.00 per month. We also have many other custom reports that are available upon request. Customer Activity Summary Report

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Return Reason Code Summary

ACH Commerce also provides two verification services to assist you in reducing return items. These services are known as ACH MatchTrac and ACH VeriTrac. MatchTrac is instrumental in reducing administrative type returns such as non-participating financial institution and invalid routing number. VeriTrac is useful in reducing account closed and NSF return types. More information on these services can be found at in the Authentication and Verification Services portion of this guide or at www.achcommerce.com under Corporate Services.

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CONTACT INFORMATION
Mailing Address : ACH Commerce, LLC. 8920 B Transport Lane, Suite 1 Ooltewah, TN 37363 800-724-8780 Toll Free 423-238-5184 Main 423-238-5187 Fax sales@achcommerce.com support@achcommerce.com processing@achcommerce.com is@achcommerce.com

Phone Numbers :

General E-Mail:

Management Personnel Listing

Deborah Hickok, AAP President Email dhickok@achcommerce.com David Peace Executive Vice President, Sales & Marketing Email dpeace@achcommerce.com Alan Lane, AAP Chief Information Officer, Software Development Email alane@achcommerce.com Dana Peace Bianculli Sales, Marketing and Administration Email dana@achcommerce.com Michael Clements, AAP Customer Service Manager, Sales Implementation & Setup Email mclements@achcommerce.com Clint Blaylock Processing Manager, Sales Implementation & Setup Email cblaylock@achcommerce.com Dan Cummings Processing Specialist Email dcummings@achcommerce.com Terri Moffett Processing Specialist Email tmoffett@achcommerce.com Valerie Clark Quality Control, Accounting Email vclark@achcommerce.com
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