Overview

Automated Clearing House (ACH) is an electronic network for transactions used globally across the finance industry.

The ACH Network is a batch processing, store-and-forward system that processes large volumes of credit and debit transactions in batches. Transactions received by the financial institution during the day are stored and processed later in a batch mode. Rather than sending each payment separately, ACH transactions are accumulated over a predetermined time period and sorted by destination for transmission.

Typically, five participants are involved in an ACH transaction:

• The originating company or individual (Originator): The Originator is usually a company directing transfer of funds to or from a consumer’s or another company’s account.
• The Originating Depository Financial Institution (ODFI): The Originating Depository Financial Institution (ODFI) is the institution that receives payment instructions from Originators and forwards the entries to the ACH Operator.
• The ACH Operator: An Automated Clearing House (ACH) Operator is the central clearing facility operated by a private organization or a Federal Reserve Bank (FRB) on behalf of DFIs, to or from which Participating DFIs transmit or receive ACH entries.
• The Receiving Depository Financial Institution (RDFI): The RDFI is the Depository Fund Institution (DFI) that receives ACH entries from the ACH Operator and posts the entries to the accounts of its depositors (Receivers).
• The receiving company, employee, or customer (Receiver): A Receiver is a person or an organization which has authorized an Originator to initiate an ACH entry to the Receiver’s account with the RDFI.

In the ACH terminology, Originator and Receiver refer to the participants that initiate and receive the ACH entries rather than the funds. An ACH entry may be a credit or a debit entry. By examining what happens to the Receiver’s account, one can distinguish the difference between an ACH credit and an ACH debit transaction.

• ACH credit entries occur when an Originator initiates a transfer to move funds into a Receiver’s account.
• In an ACH debit transaction, funds flow in the opposite direction. Funds are collected from a Receiver’s account and transferred to an Originator’s account, even though the Originator initiated the entry.

While ACH credit is handled by the Vendor ACH module of Odessa Core, this document intends to cover ACH debit transactions and how they are handled.

Pre-requisites

To process and create receipts for ACH payments in Odessa Core, you first need to ensure that the ACH Operator Config table is defined, followed by setting up the Bank Account and Bank Branch for the legal entity.

Working with ACH

In the application, you can define in ACH in the following ways:

• Recurring ACH
• One time ACH

Defining ACH for a Legal Entity

You can define various ACH settings at the legal entity level while creating/editing one in Odessa Core.

While setting up a legal entity, scroll down to the Bank Account Details section to specify details of the bank account to which ACH payments should be credited and click the Add button.

In the Legal Entity Bank Account dialog box, you can enter the following information:

1. Enter the Account Name.
2. Click the eye icon for the Account # field and enter the corresponding account number.
3. In the Branch Name field, select the branch to which the bank account belongs to.
4. Enter the IBAN number, Currency, and GL Segment Value.
5. Click the ACH/PAP option under the Automated Payment Method field to indicate that this account should be used for automated payments.
6. To mark this account as the default account for automated payments, check the Primary ACH/PAP
   1. NOTE: It is recommended to have one account marked as primary, for each currency to be processed through ACH .
7. In the ACH Operator field, select the appropriate operator and file format for the account.
8. Select the required information in the Account Type, Account Category and other fields before clicking OK.

Field	Field Description
Account Name (Mandatory)	Name of the Account as per the bank records
Account # (Mandatory)	Account number. It is a unique identifier of each account.
Last 4 Digit Account #	Read only field. Displays last 4 digits of the account number.
Branch Name (Mandatory)	Refers to the name of the Branch of the Bank. Each bank branch has a unique code as identifier. Can be selected from any active Bank Brach available in the system.
IBAN	Internationally agreed system of identifying bank accounts across national borders to facilitate the communication and processing of cross border transactions. It is a unique identifier.
Currency	Currency in which the ACH should be processed
GL Segment Value (Mandatory)	GL Segment Value for the account for accounting records
Automated Payment Method	Indicates if the account operates ACH or PAP
Primary ACH/PAP	Allows the Users to specify if the account details given are primary to the Legal Entity for ACH/PAP transactions.   Enabled when the ACH/PAP condition is enabled.
ACH Operator (Mandatory)	Identifies the ACH Operator for the account. Can be selected from the list of active ACH Operators configured in the system. Enabled when ACH/PAP condition is enabled.
Account Type (Mandatory)	If the account is Paying or Receiving or Both. Becomes mandatory when the ACH/PAP condition is enabled.
Remittance Type	Mode of Remittance for the account – Check, Wire, ACH, or All
Default Bank Account For	If the account is to be used as the default account for remittances in Check, Wire, ACH, or All.
Account Category (Mandatory)	Indicates whether account category is ‘Savings’ or ‘Checking’
Active	Indicates if the Account is active
ACIS Customer Number	Customer reference number in the generated ACH/PAP control files
Source of Input	Free form text field. User-defined source of input; this value will be used as part of the generated ACH/PAP control files

Bank Branches

While selecting the Bank Branch field for the Legal Entity, it is important that the branch you select is configured for automated payments.

For this, access the Bank Branch section from the main menu under Entity >> Setup >> Bank Branches.

With the basic details entered, enter the the following information pertaining to automated payments:

1. Enter the Name and Bank Name.
2. To enable pre-authorized payments, enable the PAP
3. Enter the Bank Transit Code/PAP Routing # for ACH or PAP payments.
4. In the Electronic Network Supported for Financial Transactions field, select whether the account should be considered for ACH or PAP payments.
5. In case you need the system to create an additional control file, enable the Generate ACH/PAP Control Files
6. In case you wish to add a credit entry to the ACH/PAP file, enable the Generate Balanced ACH
7. In the Recurring ACH/PAP Lead Days field, enter how many days advance should the ACH/PAP request be sent for processing in case of recurring automated payments.
8. Similarly, add the lead days for one-time automated payments in the One-time ACH Lead Days
9. Indicate whether you wish to have the records in the NACHA file padded by Spaces or Zeros.

FIELD	FIELD DESCRIPTION
Name (Mandatory)	Unique Identifier for the bank branch.
Bank Name (Mandatory)	Bank Name is a mandatory field. Only one Bank Branch can exist for unique combination of Name and Bank Name.
Country	Country to which the Bank Branch is associated
PAP	This checkbox denotes if the bank branch is used for pre-authorized payments. When you select this checkbox, the Transit Code should be used for PAP. If you do not select the checkbox, the Transit Code is used for ACH. (This is based on the assumption that the same branch would not be used for ACH as well as PAP.)
Validate Transit Code Length	Indicates if the transit code should be validated
Bank Transit Code	Nine-digit bank code, used in the United States, which appears on the bottom of negotiable instruments such as checks identifying the financial institution on which it was drawn.
PAP/ACH Routing # (Mandatory)	A PAP/ACH Routing Number identifies the primary branch that acts as a clearing house for electronic payments, not necessarily the Branch the payment was drawn on.
Wire Routing #	Nine-digit Wire numbers used for paper or check transfers identifies the primary branch that acts as a clearing house for checks.
Electronic Network Supported   for Financial Transactions	It is a radio button field with two options: ACH & PAP. It is a mandatory field. Indicates if the branch supports ACH or PAP for electronic mode for financial transactions.
SWIFT Code	SWIFT code is a standard format of Bank Identifier Codes (BIC) and it is unique identification code for a bank. These codes are used when transferring money between banks, particularly for international wire transfers. Banks also use the codes for exchanging other messages between them.
Business Calendar	Business Calendar followed by the Bank Branch. Lookup lists all the active business calendars configured in the system.
Internal Bank #	An optional text field used to be sent in outbound interfaces.
Active	Indicates if the bank branch is active or not.
Generate PAP/ACH Control Files	Indicates if ACH/PAP control files must be generated
Generate Balanced ACH	Indicates if balanced ACH must be generated
Recurring ACH/PAP lead days	Indicates the number of lead days for recurring ACH/PAP
One Time ACH lead days	Indicates the number of lead days for one time ACH
NACHA File Padding Option (Mandatory)	Indicates the padding options for the NACHA file.

Recurring ACH

Recurring ACH allows you to schedule recurring payments at the customer and contract level.

Defining ACH for a Customer

Odessa Core allows you to define default ACH parameters for a customer, which can be used for any further contracts associated with that customer.

While creating a contract, you can choose to use these defaulted ACH parameters or define new parameters.

Bank Accounts / Credit Cards

While adding/editing a customer, navigate to the Bank Account / Credit Card Details section to define the accounts applicable for the customer and click Add.

In the Party Bank Account dialog box, enter the following information:

1. Enter Account Name.
2.  

In case you have active Credit Cards in the system, you can choose to add a credit card as the preferred payment method for the ACH request. Hence, you would need to enter the Payment profile ID of the credit card, instead of the bank account number in the Account #/ Payment Profile ID field.

• Click the eye icon for the Account # field and enter the corresponding account number.

3. In the Branch Name field, select the branch to which the bank account belongs to.
4. Enter the IBAN number and Currency.
5. Click the ACH/PAP option under the Automated Payment Method field to indicate that this account should be used for automated payments.
6. To mark this account as the default account for automated payments, check the Primary ACH/PAP
7. Select the type of account in the Account Category field and click OK.

Field	Field Description
Account Name (Mandatory)	Name of the Customer who has an account in the bank. This must be entered as per the bank records.
Account # (Mandatory)	Unique identifier of each account. The account number can be a maximum of 20 digits.
Last 4-digit Account #	Displays the last 4 Digit of the Account Number
Branch Name (Mandatory)	Refers to the name of the Branch of the Bank. Each bank branch has a unique code as identifier
IBAN	Internationally agreed system of identifying bank accounts across national borders to facilitate the communication and processing of cross border transactions. It is a unique identifier
Currency	Select currency for the bank account from the list of currencies available
Automated Payment Method	Indicates whether the payment is made through ACH/PAP or credit card. Not applicable in case the account is not used for automated payments.     Credit Card is available in the Edit mode only.
Primary ACH/PAP/CC	Enables you to specify if the account details given are primary to the customer.
Account Category	Enables you to select the type of account, such as Savings or Checking (in case of ACH/PAP) or Credit Card (in case of credit card).
Active	Indicates the status of the Bank Account. In create mode, this is set to yes and cannot be overridden.

ACH/PAP/CC Assignments

With a bank account associated to the customer, scroll down to the ACH/PAP/CC Assignments section and click the Import Receivable Types button.

From the list of receivables available in the system, select the ones applicable for automated payments and click OK.

Select a receivable type and click the Edit button to define parameters to be used to automate the payments.

In the Customer ACH Assignment dialog box, enter the following information: