General Questions About Direct Deposit
Getting Started with Direct Deposit
Concerns About Direct Deposit
General Questions About Direct DepositWhat is Direct Deposit?Direct Deposit is an electronic payment deposited directly to your checking or savings account. How many people use Direct Deposit?Three out of four working Americans who have Direct Deposit available for their pay use it. Ninety-seven percent (97%) of Direct Deposit users are very satisfied with it. Do I have to use a certain financial institution to participate in Direct Deposit?No. You may use any financial institution in the United States that is a member of the ACH Network. A very small number of financial institutions are not ACH Network members, so be sure to check with the financial institution of your choice to make sure it can accept your Direct Deposit. Do I need to have a checking account to use Direct Deposit?No. Your money can be deposited into any account you specify, or be distributed among different accounts. Can I divide my pay among different accounts if I use Direct Deposit?With Direct Deposit, you may have the option of splitting the deposit. Check with your employer or the company issuing your payment for more information. When can I withdraw money from payments deposited to my account using Direct Deposit?Your money is generally available to you when your financial institution opens for business on payday. What if my pay date falls on a holiday?If your pay date falls on a holiday or other dates when financial institutions are closed, your money will be available on the day before your scheduled pay date. How will I know when my payment has been deposited using Direct Deposit? How much money in taxes and deductions is withheld from my pay?Most companies issue a dated payment stub that is identical to what you receive with a paper check. This stub shows how much was deposited into your account, the date of the deposit, and an itemized list of tax, insurance, and other deductions. I don't want the joint owner of my checking account to know how much money I make. How can I participate in Direct Deposit?The best way to keep transactions confidential from a joint account holder is to open another single account. Depending on the company's policy, you may be able to split your deposits among multiple accounts. Check with your employer or the company issuing your payment for more information. What should I do if I change financial institutions?You will need to provide your new account information to your employer or the company issuing your payment. You may also need to complete a new authorization form. Be sure to leave the old account open until the first Direct Deposit transaction appears in your new account. What if I want to cancel my Direct Deposit?You will need to contact the company that is sending you the Direct Deposit. Getting Started with Direct DepositHow do I sign up for Direct Deposit?If your company offers Direct Deposit, you will be provided with an authorization form. What if my company does not offer Direct Deposit? How can I let my employer know that I want it?Tell your employer that you're interested in being offered Direct Deposit as a benefit. You may want to download the one-page fact sheet to show your employer the benefits of Direct Deposit. Can my employer require me to use Direct Deposit for payroll?Some states allow companies to mandate Direct Deposit of payroll. Contact your state for more information. Why did my employer ask for a voided check when I signed up for Direct Deposit?The company uses the financial institution identification number (also known as a routing transit number) as well as the account number that appear on checks to set up the Direct Deposit. The voided check is a way to make sure the information is correct. Does Direct Deposit cost me any money?No. Direct Deposit should not cost you anything. In fact, many financial institutions offer free checking to consumers using Direct Deposit. Concerns About Direct DepositWith Direct Deposit, won't more people have access to my personal account information? Will my employer be able to take money out of my account?No. Once you sign up for Direct Deposit, the information you provide simply becomes part of the transaction information read by computers. No one knows that information, and no one can withdraw money from your account. What happens if my payment goes into someone else's account?That's very unlikely. Should an error occur, however, simply notify the company that sent the payment. What should I do if I have a problem with Direct Deposit?Problems with Direct Deposit are rare because payments are made electronically. If you do have a problem, you will need to contact your employer or the company that sent you the Direct Deposit. The problem can usually be corrected immediately. How will I be able to keep track of the balance in my account?You will be able to manage your balances with your account statements, automated phone systems, or online. The amount of money I receive is confidential. With Direct Deposit, can I be sure my privacy is protected?Yes. In fact, your privacy will increase when you use Direct Deposit. Once you have authorized the Direct Deposit, computers - not people - are processing the payments. Multiple levels of security are in place to protect the payment as it passes electronically through the banking system. What if my deposit isn't in my account on the pay date?In the unlikely event that your deposit fails to post to your account on the scheduled pay date, contact the company that sent the payment immediately. |
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