Adding a ForthPay Reserve Account

This article describes the details involved in adding a ForthPay Reserve Account. This article is broken down into the following sections:

• Overview
• How does a reserve account work?
• How to make an initial deposit
• How do you set up a Reserve Account?
  • Account to Account Transfer
  • Account to Client Transfer (can also be performed from the Enrollment page).
  • Account to Client Transfer - Settlement Advance
• Reserve Limit
• Recommended Minimums for Reserve Account

Overview

A ForthPay reserve account is a separate dedicated account that may be used to pay for consumer refunds, chargebacks, advances on consumer NSF accounts, etc. Reserve accounts are highly recommended as a mechanism to pay for unexpected business expenses and other funding shortfalls. The reserve account can be funded by depositing funds directly with Forth or they can be pulled from available earned fees. 

How does a Reserve Account work?

Reserve accounts are “rolling balance” accounts and can be used up to the available balance. If funds are drawn down to advance a settlement payment or refund a consumer, the transfer is immediate and the account available balance is updated. The account is replenished daily from the earned fees you collect back to the preset reserve amount you set up. 

How to make an initial deposit

For new companies who may not have sufficient earned fees to deposit, it is suggested to wire funds or mail a check to Forth. To wire funds directly, please contact Forth at settlements@setforth.com.

The recommended minimum deposit is $1000.00.

For checks, please make payable to Forth Inc. and send them to the following address: 

Forth Inc. 150 N Martingale Rd, Suite 1200, Schaumburg, IL 60173

The alternative is to wait for funds to build up in the account to meet the reserve limit. 

IMPORTANT: A new automated process recoups Forth Pay advances when DRSP reserve balances are low, automatically scheduling the recoupment based on anticipated fund inflows. Users retain the ability to override the suggested recoupment schedule if needed.

During this time, any earnings will not be paid until the reserve limit is met. Any NSF accounts or fees that are due will need to be immediately funded and wired to Forth for payment.

How do you set up a Reserve Account?

The following steps illustrate the basics for setting up a reserve account in Forth. Navigate to the Accounting tab and select the "Fee Accounts" button (see below). 

IMPORTANT: A Forth Pay Payee is required to setup a Reserve Account. If a new Forth Pay Payee is required, please see our documentation on setting up a Payee HERE.

NOTE: All new Forth Pay Payees are automatically placed on a processing hold until compliance@setforth.com receives and approves a Payee Setup Form. The CRM will prompt you with this upon the Payee's creation

Account to Account Transfer

An Account-to-Account transfer allows you to instantly transfer funds between two payee Fee Accounts. A balance for the transfer must be available in the account to wish to transfer from.

To perform an Account-to-Account transfer, select the "Account-to-Account Transfer" from the banner option (see below).

The transfer modal will open and you will be prompted to select your "From Account" and your "To Account" from the dropdown menu. You'll then enter an amount and memo and select "Transfer Funds".

This is an instantaneous transaction and the withdrawal will show up in the history of the "From Account" and the deposit will show in the history of the "To Account".

NOTE: If you do not have adequate funds available, you will receive a warning like the one shown below:

Account to Client Transfer (can also be performed via Enrollment page).

An Account-to-Client transfer allows you to instantly transfer funds from a payee Fee Account directly to a client custodial account. A balance for the transfer must be available in the account to wish to transfer from.

To perform an Account-to-Client transfer, select "Account-to-Client Transfer" from the banner option (see image below). 

OR if you can go to the "Enrollments" tab and select "Advance Fees" from the Navigation Bar.

The transfer modal will then open, and you will be prompted to select your "From Account" from the dropdown menu.

Enter the client ID/name into the "To Contact" field (select it once it shows up just like when searching for a contact). 

Next, enter a transfer amount in the "Transfer Amount" field. 

Finally, you may either type a memo in the "Memo" field (see example above), or if you click the "Memo" header a dropdown menu becomes visible to choose one of several pre-entered memos (see example dropdown menu on the bottom right of the image above). Click Save when finished.

IMPORTANT: This is an instantaneous transaction. The withdrawal will show up in the history of the "From Account" and the transfer will be reflected in the contacts enrollments as the type "Transfer".

NOTE: If you enter a recoup date, a recoup transaction will be scheduled.

Account to Client Transfer - Settlement Advance

To perform an Account-to-Client transfer as a Settlement Advance, follow the directions listed above, with the exception that you must enter a "recoup date to ensure a "Settlement Advance" (see next section below).

Be sure to select a "Recoup Date" from the calendar on a date the client will have funds in the future.

Click the Save button when finished.

Again, this is an instantaneous transaction. The withdrawal will show up in the history of the "From Account" and a "Settlement Advance" will be reflected in the contacts enrollments as the type "Settlement Advance".

The recoup transaction will be scheduled in the future as an ACH Credit Fee with the memo "Settlement Advance - Memo - "Recoup."

Reserve Limit

To determine or makes changes to your Reserve Limit, return to the Accounting tab and click Fee Accounts. You should then see the top left of the page looking similar to the image shown below:

You can select the payee account you'd like to set up from the dropdown menu titled Select Payee Account. If you do not see the payee account you want or need to set up a new payee account, contact Settlements@setforthcom for further assistance.

Once you have selected the payee account, click the link highlighted in red in the image above - Reserve Limit, and a pop-up window will appear (see below). Enter a new amount and hit the Save Reserve button.

Note: The reserve limit can be changed at any time by your firm's authorized user(s).

REMINDER: An automated process recoups Forth Pay advances when DRSP reserve balances are low, automatically scheduling the recoupment based on anticipated fund inflows. Users retain the ability to override the suggested recoupment schedule if needed.

Recommended Minimums for Reserve Account

The table below outlines the recommended minimum reserve account balances with Forth Pay. A minimum reserve balance of $1,000 is required upon initial enrollment, with subsequent recommendations scaled according to client enrollment numbers.

NOTE: Please keep in mind that these are suggested amounts, if your organization has worked well with a specific reserve amount, your company may be allowed to not move up to the next recommended reserve amount. Please reach out to your Account Manager if you have questions.

Article Version History: