Posted by NationalACH on Mar 05, 2010

How are ACH Transactions Classified?

This article provides information on the classification codes associated with ACH processing

ACH Classification Codes

The Standard Entry Class (SEC) code is a three letter code that identifies the nature of the ACH processing entry. Here are some common SEC codes:

ARC Accounts Receivable Entries. Checks received by a merchant through mail or drop box and presented as an ACH entry.

BOC Back Office Conversion. Checks that are converted from paper to an electronic debit at a centralized location.

CCD Corporate Cash Disbursement. Primarily used for business to business transactions.

DNE Death Notification Entry. Issued by the Federal Government.

POP Point-of-Purchase. A check presented in-person to a merchant for purchase is presented as an ACH entry instead of a physical check.

POS Point-of-Sale. A debit at electronic terminal initiated by use of a plastic card. An example is using your Debit card to purchase gas.

PPD Prearranged Payment and Deposits. Used to credit or debit a consumer account. Popularly used for payroll direct deposits and preauthorized bill payments.

RCK Represented Check Entries. A physical check that was presented but returned because of insufficient funds may be represented as an ACH entry.

TEL Telephone Initiated-Entry. Verbal authorization by telephone to issue an ACH entry such as checks by phone. (TEL code allowed for inbound telephone orders only. NACHA disallows the use of this code for outbound telephone solicitations calls. )

WEB Web Initiated-Entry. Electronic authorization through the Internet to create an ACH entry such as Paypal.

XCK Destroyed Check Entry. A physical check that was destroyed because of a disaster can be presented as an ACH entry.


ACH payments are the most the preferred alternative payment method for millions of Americans.

An ACH merchant account gives you the ability to collect payments from consumers that don't have cards, are maxed out on cards, or who simply prefer to pay you with an electronic check.

ACH payment processing reduces expenses, increases cash flow, and provides another convenient way for consumers to pay you.

Do you want to accept ACH payments?

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