{"id":1739,"date":"2014-07-21T23:10:03","date_gmt":"2014-07-21T23:10:03","guid":{"rendered":"https:\/\/www.peeriosity.com\/shared-services\/articles\/?p=1739"},"modified":"2022-05-12T08:07:14","modified_gmt":"2022-05-12T08:07:14","slug":"increasing-electronic-payment-rates-by-simplifying-the-setup-process","status":"publish","type":"post","link":"https:\/\/www.peeriosity.com\/shared-services\/articles\/2014\/07\/increasing-electronic-payment-rates-by-simplifying-the-setup-process\/","title":{"rendered":"Increasing Electronic Payment Rates by Simplifying the Setup Process"},"content":{"rendered":"

As a follow-up to the December 2013 research brief on the topic of \u201cMandating Electronic Payments to U.S. Suppliers\u201d, this article takes a closer look at one of the process steps companies often follow when setting up a supplier for electronic payments.\u00a0 While no longer required, many companies create an Automated Clearing House (ACH)<\/a> pre-notification transaction (a pre-note) using a nominal dollar amount to test the setup prior to activating electronic payments.\u00a0<\/span><\/p>\n

Years ago, pre-notification transactions were necessary; however, today there isn\u2019t any ACH rule to require companies to validate bank account and routing information.\u00a0 There is also a common misconception that the receiving financial institution is required to inspect the pre-note to verify that the account name matches with the name record associated with the account<\/a>, when in fact the only requirement is to verify that the routing number is valid and that the account number appears to be valid based on the numbers length, format, and, in some cases, the presence of a mathematical check digit in the number.<\/span><\/p>\n

A Peeriosity member recently used iPollingTM<\/sup> to find out how prevalent the practice of using a test transaction was, in hopes of learning from others about practices that could simplify their path towards a greater volume of electronic payments for their U.S.-based operations.\u00a0\u00a0<\/span><\/p>\n

Specifically, the iPolling question asked companies if they conducted testing using a nominal dollar amount (for example, $.01 or $.10) to create a live transaction to ensure account information is accurate.\u00a0 Interestingly, the results suggest that only one out of three companies conduct such a test for their suppliers, with the remaining companies either using other methods to verify the information or deciding not to take steps to verify the data prior to creating a live transaction.<\/span><\/p>\n

Here are the details:<\/span><\/p>\n

\"ipolling<\/p>\n

Because iPollingTM<\/sup> allows respondents to make additional comments to clarify their responses, once Peeriosity members review the summary of a poll, it is always a good idea to take a close look at member comments.\u00a0 (Note that Peeriosity members can also see the names of other respondents with the ability to contact other members individually to discuss solution options).<\/span><\/p>\n

Here are some of the additional comments from companies that selected the response to indicate that they complete a nominal currency test for all suppliers:<\/span><\/p>\n