-as of [16 APRIL 2024]–
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*aka ‘direct credit’*
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-in ‘banking’, a ‘direct deposit’ is a ‘deposit’ of ‘money’ by a ‘payer’ directly into a payee’s ‘bank account’-
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Direct deposits are most commonly made by businesses in the payment of salaries and wages and for the payment of suppliers’ accounts, but the facility can be used for payments for any purpose, such as payment of bills, taxes, and other government charges.
When making a direct deposit by means of electronic funds transfer, the payer also normally enters reference information to make it easy for the payee to recognise who made the deposit and which account to credit.
The reference may be an account number, an invoice number, the payer’s name, or some other meaningful identification.
To ensure that the payee is aware of the deposit, the payer commonly follows up by sending to the payee a remittance advice.
The direct deposit facility is often better known by country-specific payment systems used to action these payments such as the following:
Giro in most of Europe
ACH Network (ACH) in the United States
Direct entry in Australia
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Alternatives
If a funds recipient does not have a bank account, but a payer is obligated to pay by electronic funds transfer, alternative payment arrangements need to be made.
For example, a US law of 1996 required the federal government to make electronic payments, such as direct deposit, available by 1999.
As a part of its implementation, the US Treasury Department paired with Comerica Bank and MasterCard in 2008 to offer the Direct Express Debit MasterCard prepaid debit card, which can be used to make payments to federal benefit recipients who do not have a bank account
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See also
Debit card
Direct debit
Electronic bill payment
Wire transfer
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References
^ “Federal government chooses direct deposit and prepaid cards over mailing checks” Archived 2013-04-23 at the Wayback Machine, BankCreditNews, 15 April 2013, accessed 22 April 2013.
en.wikipedia.org /wiki/Direct_deposit
Direct deposit
Contributors to Wikimedia projects2-3 minutes 2/4/2004
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