|Doc. Number||Article Title||Effective Date||Version|
|FHC-XX||What is Direct Pay?||March 30, 2023||1.0|
Direct Pay is a payment type that helps streamline the business process and improve the delivery of settlement payments to creditors.
What is an ACH Credit or Direct Pay?
Direct Pay is simply a new payment method that Forth will be using to pay creditors via ACH credits.
ACH is an acronym for Automated Clearing House, an electronic network used to process bank-to-bank transactions. An ACH credit occurs when funds are deposited electronically into a creditor account by Forth. Forth initiates a payment through our bank, which then electronically transmits the payment through the ACH network to the recipient's bank account.
How is this different from current payment processing?
Instead of a creditor submitting payment against your settlement account as a DEBIT (usually as a check by phone or ACH debit payment), Forth sends ACH payments as a CREDIT directly to creditors.
What does this mean in terms of settlements?
ACH Direct Pay or ACH Credits means You authorize Forth to transfer a specified payment amount from your client’s custodial account to the creditor's account. This eliminates the need for you to make daily decisions on the decisions page as there will not be a check payment presented to us for a decision. A scheduled settlement payment is pushed to the creditor if the transaction is “pending” and has sufficient funds. Low Balance transactions will not be sent until they are funded by the consumer or advanced funds by your company.
What are the benefits of Direct Pay?
- Fast and convenient.
- Fewer decisions to handle and make each morning.
- Easier to monitor/manage settlement payments and advance funds when needed.
- Eliminates worry about checks getting lost in the mail.
Q: How is an ACH Credit different from ACH Debit?
A: ACH credits occur when funds are automatically deposited electronically into a creditor’s account by Forth Pay. ACH Debits occur when a creditor draws funds from a client/ForthPay account and are decisioned via the Decisions Page.
Q: How do ACH Credits affect daily settlements?
A: The daily reconciliation and matching process of settlements designated as ACH Credits will be eliminated from the review decisions page. You can manage your settlements via the low balance forecast report (Click here) and uncollected settlements report (Click here).
Q: What happens with NSF/ Low Balance client accounts?
A: For client accounts that are low balance, they will be left in low balance status and not paid. If you wish, you can manually advance funds before the payment is due and the system will then pay the settlement. If you don’t advance, the settlement will be paid automatically by the system once the client has funds available.
Q: How do I know what client accounts are Low Balance?
A: Forth has created tools to help you manage low-balance settlements. These include automatic email triggers sent to your settlements team and also the low balance forecast report.
Q: How do I know if the creditor got paid?
A: Refer to the settlement. If paid, the settlement will automatically be updated with status = Cleared. We are working to provide tracking information and will provide updates as soon as they become available.
Article Version History:
|1.0||03/30/2023||Added header and version control footer; updated company references to Forth; Updated the first paragraph to the present tense and to reflect the current status of this feature.|