Automated Clearing House

To preemptively reduce your exposure to fraud, Citi administers and manages an ACH Debit Block service that automatically returns all ACH Debits, preventing them from posting to your account.

Citi's ACH Debit Filter service enables you to create, maintain and update Electronic Payment Authorizations (EPA) to filter and identify ACH Debit transactions that are approved to post to your account. Users can create, change, and delete Electronic Payment Authorizations for all accounts set up with ACH Debit Block.

Electronic Payment Authorizations identify ACH Debit transactions by Originator (Company Identification); however, the advanced functionality of Citi's ACH Debit Filters enables you to further customize the filters using additional authorization criteria including:

• Single Payment Authorization
• Recurring Payment Authorization
• Fixed Dollar Amount
• Maximum Dollar Amount
• Authorization Expiration Date

Citi's ACH Positive Pay service provides you with an additional opportunity to review ACH Debit transactions that have been rejected as a result of an ACH Debit Block and/or an ACH Debit Filter. Using this solution, you can review the transaction, decide if it should be paid or returned to the originating bank, and even create a new ACH Debit Filter to authorize future transactions. This new enhancement offers several key benefits to ensure your organization avoids the burden and costs associated with inadvertently rejecting ACH Debit payments.

1. When Citi receives an ACH debit transaction for an account with an established ACH Debit Block, a query is performed against the client's ACH Debit Filters (Electronic Payment Authorizations) on file.
2. If the transaction meets the authorization criteria (as defined by the client's ACH Debit Filters), the transaction is posted to the client's account.
3. If the transaction does not match the client's authorization criteria, Citi's ACH Positive Pay service will send email notifications to designated users.
4. Upon receipt of the notification, the user will have the opportunity to review the ACH debit transaction and decide if the transaction should be paid or if it should be returned to the originating bank.
5. If the transaction is flagged to proceed with payment, the user will have the opportunity to create a new ACH Debit Filer (Electronic Payment Authorization) to authorize future occurrences of these types of transactions.

Citi's ACH Warehouse Inquiry feature enables users to query Citi's ACH database for ACH transactions. This feature provides access to additional transaction information including remittance details.

Citi's ACH Control Total Verification feature provides an alternative method of entering File Control Totals for ACH Origination. Using this feature, users can submit approved transaction totals which will be used to verify the ACH file totals on the file received by Citi. If the file values received by Citi match the approved transaction totals, Citi will submit the file for straight-through processing. If the file values received by Citi do not match the approved transaction totals, Citi will notify you of the exception and work with you to resolve the discrepancy. New functionality for Citi ACH Control Total Verification enables users to submit the approved transaction totals (Total Debit Dollar Amount and Total Credit Dollar Amount for ACH Origination files) directly into the CitiDirect^® Online Banking portal. This enhancement enables users to save time and dynamically manage ACH Origination files at the user's convenience. Citi will also continue to offer its standard voice response system to submit approved transaction totals over the phone (should users prefer to use that method).

The enhanced application security and entitlements offered through CitiDirect ACH enables organizations to control access to transaction details with customized User Groups. In addition to controlling access to transaction information, User Group entitlements can also be used to determine which users can modify and set ACH Debit Filters, which users receive email notifications and which users can reject or accept exception transactions.

CitiDirect users must be entitled to access this application. Once entitled, users can access CitiDirect-ACH using their CitiDirect log in credentials.

Automated Clearing House (ACH) Payments –

The U.S. payment landscape is going through significant transformation. High-volume, low-dollar consumer and business payments are typically made via ACH (with settlement either next day or same day), though checks still hold a share of business-to-business payments. Instant payments, launched in 2017 via The Clearing House’s RTP system, was the first new payment scheme in the U.S. in 40 years, and is expected to grow in usage over time. Other emerging networks and alternate payment methods, such as Zelle, Venmo, and PayPal are also proliferating for consumer payments. Larger-dollar, lower-volume same-day payments are usually routed through the same-day transfer systems, such as Fedwire and The Clearing House for Interbank Payment System (CHIPS). In the U.S., access to clearing and settlement systems is typically limited to financial institutions only.

High-volume, low-dollar payments historically have had longer settlement times and are typically made via ACH (Same or Next Day Value), the check clearing systems or eventually Instant Payment methods.

A NACHA member since 1986, Citi processes ACH for 6,000+ clients. We offer industry leadership with a large market share:

• Ranked 4th on NACHA’s Top 50 List of Originators in 2023
• Citi, as a whole, averages approximately 109 million ACH transactions a month
• Board membership on the NACHA and EPN board
• Members on the NACHA Risk Management Advisory and Payment Alliance Groups
• Owner bank of The Clearing House with participation on the EPN Business Committee
• Key Presenters at the annual NACHA Payment Conference

ACH Application Security and Entitlements

The enhanced application security and entitlements offered through CitiDirect-ACH enable Citi clients to control access to transaction details with customized User Groups. In addition to controlling access to transaction information, user group entitlements can also be used by Citi clients to determine which users can:

• Modify and set ACH Filters
• Receive email notifications of unauthorized rejected transactions
• Reject or accept exception transactions

CitiDirect-ACH Safety and Fraud Mitigation Features – CitiDirect-ACH is Citi’s solution that simplifies and automates the complex ACH review and approval process with capabilities designed to provide enhanced transparency, control, and usability.

Transparency: Enables users to access, navigate and manage ACH Debit transactions in Citi’s secure online environment quickly and easily.

Control: Accessed through the CitiDirect online banking portal, CitiDirect-ACH provides dual approval in an effort to mitigate fraud and may help to reduce the costs and inefficiencies associated with inadvertently approving or rejecting ACH debit payments and when adding/deleting/modifying filters.

Usability: CitiDirect-ACH, allows clients to dynamically set customized ACH debit filters and notifications to monitor and control ACH Debit transactions more effectively. CitiDirect-ACH provides users with the ability to adjust settings and controls in real-time so organizations can continue to refine system settings to better meet organizational needs.

Key Services Provided via CitiDirect-ACH:

• ACH Positive Pay: If Citi clients plan to allow debits/credits from any US Citi accounts, this feature provides clients with an opportunity to review ACH Debit/Credit transactions that have been rejected due to an ACH Debit/Credit Block and/or an ACH Debit /Credit Filter. With this solution, clients can review the transaction, decide if it should be paid or returned to the originating bank, and even create a new ACH Debit/Credit Filter to authorize future transactions. This feature helps Citi’s clients avoid the burden and costs associated with inadvertently rejecting ACH Debit/Credit payments.
• Online ACH Debit Filter Management: Enables Citi clients to create, manage, and update debit/credit filters on accounts that have been set up with ACH debit/credit blocks. Clients can establish:
  • Single Payment Authorization
  • Recurring Payment Authorization
  • Fixed Dollar Amount
  • Maximum Dollar Amount
  • Authorization Expiration Date
• Online Control Totals Verification: This is an alternative method to IVR for entering File Control Totals for ACH Origination. This feature allows users to submit approved transaction totals that are used to verify the ACH file totals on the file received by Citi. If the file values received by Citi match the approved transaction totals, Citi will submit the file for straight-through processing. If the file values received by Citi do not match the approved transaction totals, Citi will notify the client of the exception and work with you to resolve the discrepancy. This feature also allows for file level notifications related to receipt and processing.

Debit / Credit Block Filters Service | Unauthorized Debit / Credit Protection

Citi enables clients to prevent unauthorized ACH debits and credits to their accounts through our ACH Debit / Credit Block and Filters Services.

Since reconciling your account(s) daily is advisable but may not always be possible, Citi recommends that clients implement an ACH debit block on their U.S. Citibank N.A. account(s). Although the majority of ACH transactions are legitimate, an ACH debit block can help reduce the potential for unauthorized, fraudulent and/or erroneous ACH debits.

Additionally, an ACH debit block is a value-add option when it comes to US ACH returns as they will process automatically versus manually and it may help alleviate processing delays.

It is the responsibility of the Receiver (your organization) to reconcile your U.S accounts on a daily basis and reject any ACH payments deemed by you to be unauthorized or improper by notifying your Citi customer service representative immediately should you find any such transaction.

• In order for unauthorized ACH Debits to be returned and promptly credited through the ACH network, the NACHA Operating Rules requires that returned items must be made available to the Originating Bank no later than the opening of business on the second banking day following the settlement day of the original transaction.
• Otherwise, such claims would need to be presented directly against the Originating Bank which can lead to delays in the return or even denial.

Please contact your Citi Service Representative on how to be set up for US ACH Debit/Credit Block and Filter Services.