AAP Handbook Questions

Question 1

What is Direct Access?

Answer 1

Direct Access occurs when an Originator, Third-Party Service Provider or Third-Party Sender transmits credit or debit entries directly to an ACH Operator using an ODFI’s routing number and settlement account.

Question 2

What is a Third-Party Service Provider?

Answer 2

An organization that performs any function related to the processing of ACH entries on behalf of an Originator, Third-Party Sender, ODFI or RDFI

Question 3

How can financial institutions and business limit their risk when dealing with Third-Party Service Providers?

Answer 3

• Entering into agreement addressing areas of Risk
• ODFI approval required for any client origination
• ODFI should establish dollars limits on files that the
  Third-Party Service Providers can deposit with the
  ACH Operator

Question 4

What is a Third-Party Sender (TPS)?

Answer 4

A type of Third-Party Service Provider that acts as an intermediary in transmitting entries between
an Originator and an ODFI, including through Direct Access, and acts on behalf of an Originator or
another Third-Party Sender.

Question 5

What does warehousing of an entry mean?

Answer 5

Storage of pending files until release or settlement date.