Everything ACH

CCD – Corporate Credit or Debit

CCD should only be used for any Business to Business transactions* and can be either Debits or Credits. CCD can be used for either a single one-time transaction or recurring transactions and may be accompanied by one addenda record.

Authorization: The authorization requirements are much more lax for CCD transactions* than PPD transactions which we discussed in the last post. However, I like to use the PPD authorization requirements as a guide for a really good authorization.

Here’s what the ACH Operating Rules say though: “The Receiver has authorized the Originator to initiate the entry to the Receiver’s account. In the case of CBR, CCD, and CTX entries, the Receiver has an agreement with the Originator under which the Receiver has agreed to be bound by these rules as in effect from time to time.” Essentially, to me, this means that there must be an agreement. That’s it, there must be an agreement.

The reasoning is that we all assume that when there is an ACH Authorization between two businesses that 1) it will be part of a larger agreement and 2) lawyers (with the best interest of the Receiver) will be involved. The difference of course is the assumption that the typical consumer would not have that luxury and therefore requires additional protections.

Please note that I strongly advocate the incorporation of all or as many as possible PPD authorization requirements be used in any Business to Business authorization.

 * Notes:

I know that I said that CCD should only be used for Business to Business transactions; there is of course, one exception. In the event a company is reimbursing an employee for expenses, that transaction to their personal/consumer account should be labeled a CCD.

Just because the requirements for CCD transactions are less onerous than PPD does not mean you should start using CCD for all of your transactions hoping to reduce your requirements. It does not work that way. Sending a CCD transaction to a consumer account, inappropriately, is a violation of the ACH Operating Rules.

And as before, when you have designed the authorization to suit your needs, please, please, please, be sure to pass it by your compliance person or preferably, your legal counsel before you roll it out for general use and after any future changes.

Stay tuned next week for TEL. Ring, ring.