Party, Party, Party

 

We just talked about the 5 main parties (Originator, ODFI, ACH Operator, RDFI and Receiver), now let’s talk about the 3rd party.

 

The Third Parties, to be exact. There are three of them and they each have a very different and distinct function.

 

Third Party Sender

Third Party Receiver

Third Party Service Provider

 

First: The Third Party Sender (TPS) exists between the ODFI and the ACH Operator . Their primary function is to simply take transactions from the ODFI and send them on to the ACH Operator. An example of a TPS is ADP. This is not a shameless plug.

 

Second: The Third Party Receiver (TPR) exists between the ACH Operator and the RDFI. Their primary function is to simply take transactions from the ACH Operator and send them to the RDFI. The TPR also generally provides additional support as well, such as posting transactions to the RDFI’s accounts, handling returns (which we’ll talk about in another post), etc. Their responsibilities will vary depending on the needs of the RDFI. An example of a TPR is The Independent Banker's Bank or FiServ. This is not a shameless plug.

 

Third: The Third Party Service Provider (TPSP) exists between the Originator and the ODFI. Their primary function is to collect transactions from an (or multiple) Originator(s) and forward to the ACH Operator. Just like the TPR, the TPSP can provide a number of additional services. THIS is a shameless plug.   Check out www.achdirect.com for all your ACH (and Credit Card and Debit Card) processing needs.

 

Now that’s a party. Hope you had fun. Tell your friends.