Early Direct Deposit

Generally, when an employer deposits a paycheck directly into an employee bank account, the money only becomes available to the employee up to 2 days later.

Cross River Early Direct Deposit (EDD) gives your customer earlier access to their money if they receive their paycheck directly to their bank account. Cross River gives your customers EDD functionality for payments sent via ACH. Funds settle when CR gets the ACH file from the Federal Reserve, instead of waiting to release the money to the account on the payment effective date. When you apply EDD to a specific product type, all your customers using that product are eligible.

Note

While EDD is primarily used for paycheck deposits, any deposit amount that falls between 0 and the EDD threshold set for the deposit account product type and has the values shown in the sandbox testing section will be treated as an EDD.

Requirements for your customers to participate

Ensure that your customers:

  • Understand the requirements and limitations.

  • Understand that EDD is not guaranteed and depends on timely transfer of ACH files.

  • Have checking or savings accounts set up with Cross River.

  • Are enrolled for direct deposit with their employers. Once EDD is enabled, 1 to 2 pay cycles are usually necessary before it takes effect.

Typical flow

  1. Your customer's employer instructs their bank or payroll agency to initiate payroll payment.

  2. The employer’s bank sends an ACH file to the Federal Reserve.

  3. The Federal Reserve sends the ACH file to Cross River.

  4. Cross River settles funds to customer’s account on the same day the ACH file is received (up to 2 days before the effective date). A memo post* is added to the available balance. On the effective date, the memo post is replaced seamlessly by a full transfer.

  5. The customer can access funds upon settlement.

*Memo posts indicate that funds will go out or come in and affect the available balance accordingly. For example, with debit cards the available balance drops. In this case, the available balance increases.

Enable Early Direct Deposit

Reach out to your Relationship Manager to enable Early Direct Deposit. Once you sign a contract addendum, COS Ops enables EDD for your customers.

Limitations

Be aware of the following limitations:

  • EDD is not guaranteed and depends on timely transfer of ACH files.

  • The customer's employer must initiate the payroll payment on time, and the employer’s bank or payroll agency must ensure delivery of ACH files to the Federal Reserve before the effective date.

  • The amount sent must be greater than 0 but less than the early ACH threshold configured for your product.

Test in the sandbox

Once we enable EDD for you in the sandbox, call the simulate ACH inbound payment endpoint to generate an ACH credit transfer that matchs the EDD requirements.

  1. Register for the Ach.Payment.ReceivedEarly webhook.

  2. Use the ACH POST /v1/payments/simulated-inbound-originations endpoint with these values for the following attributes:

    • transactionType = Push

      serviceType = Standard

    • secCode = PPD

    3. Make sure the amount you send is greater than 0 but less than the EDD payment threshold configured by CR for your deposit account product.