With ACH credit, the payer initiates payment through their financial institution. Their financial institution then electronically transmits the payment through the ACH/Federal Reserve network to the CBP account maintained by the Treasury Department.
Benefits of ACH Credit
- Payer controls the initiation and timing of payments.
- Payer controls the date funds are debited.
- Immediate posting of payment transactions.
- Fraction of the costs of FEDWIRE.
- Eliminates lost or stolen check problems.
- Reduces administrative and check processing costs.
ACH Credit Formats
The ACH Credit program uses the National Automated Clearinghouse Association's (NACHA) payment conventions. You can send ACH Credit transactions in one of the following formats:
- CCD+ Cash Concentration or Disbursement Plus contains a single payment and a single addendum record.
- CTX Corporate Trade Exchange contains a single payment with multiple addendum records.
CCD+ and CTX, along with the TXP-Tax Payment addendum format, are required by CBP.
ACH Credit Process
Step 1: The Payer Provides the Necessary Data to Their Financial Institution. CBP provides the payer with a payment format, which the payer then gives to the financial institution. The data requirements include CBP transit routing number, CBP account number, payer identifier, settlement date (the date the account is scheduled to be debited), total payment amount, document number being paid, document payment amount, and payment type.
Step 2: The Payer Initiates the Payment Transaction. The payer follows their financial institution's procedures for initiating payment. The transaction must originate at least one day prior to the settlement date. Once the transaction has been initiated it cannot be reversed. CBP does not accept reversals. Any overpayments will be handled through the normal refund process.
Step 3: The Treasury Department Transmits the Information to CBP and Payment is Posted. If the amount paid matches the amount due, the payment is posted. If there is a discrepancy, CBP will manually reconcile the transaction, which may cause a delay in posting the payment.
Step 4: The Federal Reserve Notifies the Financial Institution that Payment was Received. The transaction will be listed on the payer's bank statement, or through other arrangements made with the bank.