The auto settlement service from U.S. Central Bridge Federal Credit Union will be discontinued as of May 31, 2012. This service is used by many credit union vendors and processors to transfers funds to and from your SunCorp Cash Management Account. Many vendors may have a specific alternative option they wish you to use, or they may ask you to choose from several options including ACH or wire transfer entries.
We are here to assist you with any questions you may have about these options, and to help you setup any CorPower or APEX System templates needed to submit wire or ACH entries. It is our goal to make this process as easy as possible for your credit union. If you have questions or need assistance, please contact Monica Culver at extension 4638 or Jill Case at extension 4657.
As credit unions add services for business accounts, and consumer members use their accounts for business purposes, credit unions need to be aware of the potential issues with processing ACH entries for these accounts. The rules, procedures, and risks are different for business ACH entries compared to regular consumer accounts.
Business ACH entries are identified by their SEC (Standard Entry Class) codes of either CCD or CTX. These entry codes are used to debit / credit a business or institutional account, or a personal consumer account used for business purposes. ACH entries sent to the credit union itself – such as settlement entries for posting to a credit union general ledger account – are also covered by these special ACH rules.
Return Entry Deadline
The most important difference in handling incoming business entries is the return deadline for unauthorized entries. Normal consumer entries can be returned as unauthorized up to 60 days after the posting date. Normally, business ACH entries can only be returned as unauthorized within 24 hours of the entry settlement date, and must contain the R29 return reason code. If the ODFI (Originating Depository Financial Institution) agrees to accept a return after the 24 hour return deadline, the unauthorized CCD or CTX entry can be returned using return reason code R31.
In any case, make sure that your account agreements state that business members need to dispute any unauthorized entries immediately so that the entry can be returned before the 24 hour deadline. Otherwise, the credit union may need to absorb the loss on the unauthorized entry.
Addenda Record Information
Another issue with ACH business entries is the need to provide addenda record information. Many CCD and CTX carry addenda records – extra free-form fields that contain additional information about the entry. Some of the addenda information may be needed by your business members to accurately account for the entry. If requested by the member, your credit union needs to provide this addenda record information to the business or organization. We suggest that your ACH posting program automatically include the addenda information as part of the normal CCD and CTX posting process. Members can then view the information online or on their statements as needed.
If you have any questions on the proper handling of ACH entries for business members, contact our Member Services Department at 1-877-786-2677.