Automated Clearing House (ACH) payments are high-volume, value-dated payments exchanged among participant banks of nationwide automated clearing houses. ACH payments are reliable, predictable, and cost efficient. ACH is unique because it can be used to send funds (ACH Credit Origination) or collect funds (ACH Debit Origination) to and from other parties.

Keywords: Standard Entry Class (SEC) codes; ACH Entries; Same-day; Standard; Addenda Records; Nacha; Returns; Notifications of Change (NOC); ACH Reversal; ACH Recall; ACH Delete

Counterparty Requirements

Before kicking off a new ACH entry, Customers will need to supply counterparty information so the payment is accepted by the network. Please see the below table for the fields required.

counterparty_nameThis is the name of the counterparty (consumer or business entity).Required
account_numberThe account number of the counterparty in question. This will be the account affected by the ACH entries originated.Required
routing_numberThe routing number of the Bank (or Financial Institution) at which the counterparty's accounts is maintained.Required
account_typeType of bank account managed by the counterparty. Accepted values are checking and savings.Required

Standard Entry Class (SEC) Codes

Standard Entry Class (SEC) Codes are required when creating an ACH entry; they are connected to specific payments use cases, and as such require certain fields for origination. It’s important to become familiar with SEC codes, as they also determine constraints when submitting credit or debit entries. As a bonus, people will be really impressed with your payments knowledge!

Below is the list of SEC codes supported by Newline.

SEC CodeDescriptionCredit / DebitType of CounterpartyExample Use Cases
CCDCorporate paymentsBothCorporateB2B payments
PPDPre-arranged Payment or DepositBothConsumerPayroll, travel & expense re-imbursement to employees, and fixed pension payments
WEBInternet initiated entry - Debit or CreditBothConsumerOnline bill payments
TELTelephone initiated entryDebitConsumerCall Center initiated payments
CIEConsumer Initiated EntryCreditCorporateBill payments

For more information, context, and use cases regarding SEC codes, please refer to Nacha's official documentation.

Standard and Same-day ACH Entries

ACH entries can be designated as either standard or sameday, or will be treated as such depending on the supplied effective_entry_date.

The Effective Entry Date is the date specified by the Originator on which it intends an entry to be settled. Entries must be submitted by the cut-off time on banking day prior to the Effective Entry Date, except when sending Same-Day ACH entries.

If entries are not received prior to Effective Entry Date, the transaction will post on the next banking day, with the exception of ACH items where the receiver’s account is at Fifth Third Bank.


Operating Windows and Processing Schedule

Newline recommends submitting ACH entries no later than 10 pm ET, Monday through Friday. While Newline accepts entries 24x7, including past 10pm, if there is an issue with the entry, it cannot be addressed until the next business day.

As Newline receives ACH entries, we will attempt to process them as soon as possible and in accordance with the desired settlement time, delivered in the effective_entry_date field.

Please note that holidays are non-business days, and as such, the Federal Reserve will be closed for ACH processing. This may affect your operations, like in the below example.

NoteXYZ Company’s paydays are on Fridays. The payroll ACH entries are normally sent on Wednesday. During the month of November, one payday falls on the Friday after Thanksgiving (a Thursday). Due to this holiday, the file must be sent a day earlier, on Tuesday, to ensure memo posting of the payroll entries occurs on Friday.

Additionally, if you use a non-business day as your Effective Entry Date, this may cause the items to post later than expected. A weekend or holiday Effective Entry Date is forwarded to the next business day.

Nacha Operating Rules and Guidelines

Nacha is the governing body for the ACH Network. The Nacha Operating Rules & Guidelines contain the rules that all participants in the ACH network must follow. Organizations may order an online code, hard copies, or e-books of the Nacha Operating Rules & Guidelines (Rules), as well as other ACH related publications, at their sole cost and expense, from Nacha at the following website: https://www.nacha.org/eStore. The Rules are updated on a yearly basis and new editions are typically available for purchase in January.

Customers can receive $35 off nonmember pricing on the 2023 Nacha Rules & Operating Guidelines using our special discount code: A53BETTER at the following website. To claim the offer, simply log in to Nacha’s website and enter the discount code at checkout to receive member pricing on any format you choose: 2023 Nacha Rules & Operating Guidelines

As an Originator of ACH transactions, it’s important to stay updated on the latest Nacha news and rules. Visit the ACH Rules Resource Center for Corporates for FAQs, webinars, and details on Rules and impacts.

Roles and Responsibilities

To help understand your role in the ACH Payment Flow, and how that relates to the above Nacha rules, please refer to the following descriptions of each participant:

  • Originator: An entity that agrees to initiate transactions into the payment system according to an arrangement with a Receiver.

NoteFor ACH Debit entries, the Originator must obtain ACH pre-debit authorization, via a form or letter, from the Receiver to transact against their account. This form or letter must be retained by the Originator.

  • Originating Depository Financial Institution (ODFI): Receives the payment instructions from an Originator and forwards the Entries to the ACH Operator.
  • Automated Clearing House Operator (ACH Operator): A central clearing facility that receives Entries from an ODFI, distributes Entries to the appropriate RDFI, and performs the settlement functions for the financial institutions. There are two ACH Operators: the Federal Reserve Bank and the Electronic Payments Network (The Clearing House).
  • Receiving Depository Financial Institution (RDFI): Receives ACH Entries from the ACH Operator destined for the Receiver’s account.
  • Receiver: Authorizes an Originator to initiate an ACH Entry (Debit or Credit) to the Receiver’s account at the RDFI.
  • Third‐Party Sender (TPS): Transmits ACH Entries on behalf of Originators, typically their customer or merchants, that have no contractual agreement with the ODFI
  • Third‐Party Service Provider (TPSP): Performs any functions, such as creating and sending ACH files, on behalf of an Originator or Third-Party.

Third Party ACH Relationships

By utilizing our ACH Service, you are considered an Originator, sending ACH payments on behalf of your organization, or a Third-Party Sender (TPS), sending payments on behalf of unrelated entities.

Fifth Third is responsible for monitoring the activities of Third-Party Relationships (Third-Party Senders and Third-Party Service Providers). Providing ACH services to and/or through Third-Party Relationships introduces additional risks to the Bank. Therefore, it is important to identify if you are a Third-Party Sender or use a Third-Party Service Provider. Knowing the classification helps the Bank manage the risks associated with Third-Party Relationships, including having the proper agreements in place. Please familiarize yourself with your classification:

  • You are classified as an Originator if (all conditions must be satisfied):
    • You utilize the ACH Service to originate Entries that are settled to designated account owned by you.
    • You do not provide Third-Party payment processing services to another organization.
  • You are classified as a Third-Party Sender (TPS) if:
    • You process ACH payments through your accounts for unrelated entities (your customers, merchants, etc.).

      Note As a TPS, a Third-Party Sender agreement must be executed between you and the Bank. Additionally, Third Party Senders are considered Third-Party Payment Processors (TPPP) under the Bank’s Customer Due Diligence Policy and must be approved to establish services with the Bank. Please note that it’s mandatory under Nacha rules for a Third-Party Sender to conduct a yearly self-audit.

  • You are utilizing a Third-Party Service Provider (TPSP) if:
    • You gave an organization authorization to create and/or send ACH Entries to the Bank on your behalf
      or you received permission to create and or send ACH entries to the Bank on behalf on another Originator.

      Note   A Third-Party Service Provider agreement must be executed among you, the Bank, and the TPSP.

Exposure Limits and Prefunding

As part of Customer onboarding, we will establish, with you, the types of transactions accepted, set exposure limits and additional transaction limitations applicable to your origination activity.

If you use our Prefunded ACH without debit exposure product, sufficient, available funds must be present in your settlement account when you submit ACH entries. A hold will be placed on your account the same day you submit your file for processing if sufficient available funds are present. The Prefund process will check the account for funds availability.

Note   The Prefund process does not check loan sweep funds availability.

If available funds are not present in the account, ACH processing can continue, at Newline's discretion, to attempt to process your file up to two days past the settlement date of the transactions, until funds are available. If funds do not become available after two days past the settlement date of your file, your entries are deleted and not processed.

Additionally, you cannot submit ACH debits.

Returns and Notifications of Change (NOCs)

In some instances, an ACH transaction may be returned to you if the receiving bank cannot process it (due to incorrect account information, insufficient funds, etc.), or if the Receiver of the transaction returns it as unauthorized. Your account will be debited or credited for the amount of the returned transaction. Most ACH Returns are received and reported within three banking days. Consumers have 60 days to return an ACH Debit as unauthorized, whereas businesses have two banking days.

A receiving bank may send a Notification of Change (NOC) if they successfully process the payment, but want to advise a revision that you need to act on prior to sending another transaction to the same account. A common example is when a routing number is changed when there is a bank acquisition. An Originator must make the changes specified in a NOC within six Banking Days of receipt of NOC reporting or prior to initiating another Entry to the Receiver’s account, whichever is later, per the Nacha Rules.

If you are originating ACH Debits, you may receive Proof of Authorization (POA) requests from Newline and Fifth Third, asking for documentation showing that the ACH Debit was properly authorized by the Receiver. If the Proof of Authorization is not submitted in a timely manner, the ACH transaction may be returned.

Deletions, Reversals, and Recalls

If you release an entry in error, we provide delete, reversal, or recall services. In this event, if you'd like to request a delete, reversal or recall, please reach out to your Newline Specialist or Relationship team.

ACH Delete: A deletion request can be executed if the transaction has not yet been processed and distributed. In the event a delete cannot be processed, you can work with your Newline Specialist or Relationship team to attempt a reversal or recall.

ACH Reversal: A reversal can be processed for a transaction that was processed and distributed into the ACH system. However, the reversal can only be initiated/requested within five (5) days of the settlement date. After the fifth day, the request becomes a recall.

Note Please note that reversals are never guaranteed. When a reversal is submitted, your account will be credited or debited for the amount of the reversal. If a reversal is returned, your account will be debited or credited accordingly.

ACH Recall: A recall is a request to have an ACH transaction manually returned to you after it posted to the receiver’s account. A recall is requested when more than five (5) days have passed since the original settlement date and/or if the item was not sent in error.

NotePlease note that recalls are never guaranteed. Under Nacha rules, Originators cannot recall an ACH transaction once it is sent to the originating financial institution. However, an originating financial institution, such as Fifth Third Bank, can request a receiving financial institution to return a transaction. A receiving financial institution is not obligated to comply with such a request.


Newline can support blocks against ACH entries for interested Clients or Customers, applied at the account level. These blocks are also semi-permeable, allowing for the Client or Customer to specify supported filters to allow certain ACH entries to be accepted.

Block TypeEffect
CreditPrevents any ACH credit entries from being pushed to an account.
DebitPrevent any ACH debit entries from being pulled from an account.
Maximum Dollar EntriesPrevents any ACH entry (credit or debit) from being enacted against an account if it is above a maximum dollar threshold.
Specified CounterpartiesPrevents any specified counterparty from submitting an ACH entry (credit or debit) from being enacted against an account.

These blocks can be configured with help from your Newline Specialist, so please reach out if you'd like to discuss or start setup.

Account Validation

There are multiple ways to validate the receiver’s bank account information if desired.

  • Pre-notification: A non-monetary process for testing the accuracy of the information associated with a new transaction. Although pre-notes are no longer required, they are recommended to help you verify information prior to releasing a “live” transaction. The receiving institution then may notify you, either with a NOC or a Return notice, of needed corrections before money is transferred. After sending a pre- notification, please wait three (3) business days before initiating a live transaction.
  • Micro-Entries: ACH credits of less than $1 and any offsetting ACH debits used for the purpose of verifying a Receiver’s account. Micro-Entries require the description of ACCTVERIFY in the Entry Description. An Originator of Micro-Entries must conduct commercially reasonable fraud detection on its use of Micro-Entries, including by monitoring of forward and return volumes of Micro-Entries.
  • Account Validation: Fifth Third offers a separate Account Validation API to validate account status (open, closed, inconclusive) and account ownership matching (name, address, TIN, etc.). Please contact your Relationship team for more information if interested.

Nacha Rules require that originators sending WEB Debits (an ACH debit to a consumer account where the consumer gave authorization online), must make a commercially reasonable attempt to validate bank account status prior to the first time debiting an account.


When does the transaction have to be sent relative to the settlement date?

  • Transactions must be sent at least one (1) business day prior to the effective date, unless sending a Same-Day ACH transaction.

How many addenda records can each ACH entry carry?

  • It depends on SEC code. We support CCD, PPD, CIE, and WEB, all of which only support 1 addenda record. Please see above section about SEC codes and use cases.

What is the timeframe for an ACH transaction to be returned as unauthorized if it is a CCD entry?

  • 2 business days after the RDFI (or Receiving Depository Financial Institution) has posted the item to the Counterparty's account.

What is the timeframe for an ACH debit sent to a consumer account to be returned as unauthorized?

  • 60 days

Note   This does not negate consumer protection rights for unauthorized activity under Regulation E for ETAs.

How many business days after the settlement date of a transaction may a reversal be issued?

  • 5 days. After 5 days, a recall may be issued.

What is the deadline for sending a Sameday ACH entry?

Payment WindowFunds Availability (for Receiver)
9am ET1:30pm
1:30pm ET5:00pm
2:30pm ETReceiving Bank end-of-day processing

Note: It is best practice to send payments at least 30 minutes prior to deadline, as this assumes the payments and totals (calculated by Newline) are processed with no issue. Additionally, all times for funds availability are in the receiving bank's local processing time.

What is the transaction limit for Same-day ACH entries?

  • $1,000,000

What happens if a batch is submitted for Same-day settlement and contains one or more entries over $1,000,000?

  • All entries in the batch are processed and the items over $1,000,000 are assigned the next business day’s settlement date, whereas the remaining items receive same day settlement.