May is Direct Deposit/Direct Payment Month, a time when financial institutions and other businesses encourage employees to receive payments through the Automated Clearing House (ACH) Direct Deposit transactions, and other alternatives to paper payments.
Dallas-based SWACHA, one of the largest not-for-profit electronic payments associations in the country, conducted a Consumer Insights Survey in 2011 and found that 85 percent of those surveyed are using their employer’s Direct Deposit option, a 19 percent increase from 2009.
“I have seen an overall increase in the use of Direct Deposit and Direct Payment in the past few years, and I know that consumers understand the countless advantages these methods have to offer over paper checks,” said Dennis Simmons, AAP, president and CEO of SWACHA. “Through Direct Deposit and Direct Payment, employers can effectively and efficiently distribute finances to employees in a secure and environmentally friendly manner that is beneficial to all parties involved.”
Direct Deposit via ACH provides more protection over checks. Check fraud amounts to billions of dollars every year and Direct Deposit saves companies, employees and the government money by eliminating the risk of fraud as well as the amount it would cost to issue paper checks. Additionally, using Direct Deposit via ACH for split deposit allows consumers to automatically move part of their paycheck into a savings account promoting increased savings.
Similarly, Direct Payment is at an all-time high, wherein people are having their bills paid by Direct Payment via ACH as opposed to mailing in paper checks. Through this method, consumers automatically have their bills paid ensuring timely payments.
About Direct Deposit: Direct Deposit is the electronic transfer of a payment from a company or organization into the checking or savings account of employees, retirees, taxpayers, vendors or shareholders.
About Direct Payment: Direct Payment is the automatic electronic transfer of an authorized payment from a consumer’s checking or savings account into the account of a business, financing or investment company, or non-profit organization.
SWACHA-The Electronic Payments Resource®, is one of the largest not-for-profit regional payments associations in the country with approximately 1,100 members across the Southwest. SWACHA is the resource of choice for financial institutions and corporations in the areas of education, training, payments system risks and knowledge about electronic payments. For more information visit: