NACHA Standard Entry Class (SEC) Codes

NACHA requires that a transaction submitted to the Federal Reserve for processing must include something called a Standard Entry Class (SEC) Code to communicate exactly how the customer gave you authorization to debit/credit their bank account. There are only a few authorization methods allowed by NACHA, so this list of SEC Codes is very short. Below are some common Standard Entry Class (SEC) codes:

Consumer Applications

ARC - Accounts Receivable: This SEC code enables originators to convert checks received via U.S. mailbox location to Single-Entry ACH debits.

CIE - Customer Initiated: This code enables customer to initiate fund transfer, owed to a company, typically from a self-service banking terminal, for example, an automated teller machine, or bill payment service provider.

MTE - Machine Transfer Entry: Fund transfer through automated teller machines (ATM) supports ACH Network for clearing the transactions.

PBR - Consumer Cross Border Payment: Used for international household transactions. For example, foreign exchange conversion, origination and destination currency, country codes, etc.

POP – Point of Purchase: A check presented by the originator to a merchant for purchasing a goods or service, is presented as an ACH debit rather than a physical check.

PPD - Prearranged Payment and Deposit: This SEC code is used to credit or debit a consumer account. Generally used for payroll direct deposits and preauthorize bill payments.

POS - Point of Sale: Swapping of debit or credit card from a network, where a sales transaction occurs.

RCK - Re-presented Check: A physical check that is presented but returned due to insufficient fund in the account holder, this may represent as an ACH entry.

TEL - Telephone-Initiated: This SEC code enables a single entry debit transaction to a consumers account through an oral authorization made by a phone call.

WEB - Internet-Initiated Entry: This SEC code entry enables payment authorization is obtained from the customer via the Internet.

Corporate Applications

CBR - Corporate Cross-Border Payment: This SEC code entry is used for international business transaction. Basically these are used by giant corporate.

CCD - Corporate Credit or Debit: This SEC code entry is used for business-to-business transactions.

CTX - Corporate Trade Exchange: A fund transfer system used by corporate and government institution, to pay trading partners via the automated clearing house (ACH) system. This type of fund transfer allows payment to several parties with a single fund transfer.