Nacha File Format

Did you know that Nacha, also known as the National Automated Clearing House Association, has its own file format to facilitate Automated Clearing House (ACH) payments? It’s true, and the Nacha file format is crucial for accounts payable teams as companies and consumers move away from check payments. 

The system itself is nuanced and requires attention to minute detail to make sure it all works efficiently. Luckily, much of the work done to process ACH payments and withdrawals is handled by technology, not humans, to make it more efficient.

What Is The Nacha File Format?

The Nacha file format is straightforward at face value—a list of instructions to kickstart an ACH payment batch once the information is sent via an ACH processor and uploaded into a bank portal. It’s the payment file to make sure ACH transfers between bank accounts run smoothly. 

The Nacha file format can vary slightly between financial institutions and transfer types, but there are established Standard Entry Class Codes necessary. This particular file format is most popular because of the rise of ACH payments for B2B and individuals as well as the low cost and reliability.

When you want to work with an expert in Nacha and ACH payments, talk with us. Envestnet | Yodlee is a Nacha Preferred Partner

ACH Payment Formats and Entry Class Codes

ACH payment files can take on a variety of formats to fit the types of transfers it facilitates. 

Some of the formats include:

  • ARC - Accounts Receivable Entry

When an eligible check is received in the mail or at a dropbox location and then undergoes an ACH transfer, it’s known as an Accounts Receivable Entries (ARC). It’s a single-entry ACH debit where a check is processed as an electronic check and the debit appears on the customer’s statement as an ACH transaction.

  • BOC - Back Office Conversion

A Back Office Conversion allows originators to convert paper checks to single-entry ACH debits during processing in the back office. 

  • CCD - Cash Concentration or Disbursement

A Cash Concentration or Disbursement applies to corporate credits and debits and provides fast, secure transfers where funds clear overnight.

  • CIE - Customer Initiated Entry

A Customer Initiated Entry enables a consumer to initiate an ACH credit to transfer funds to a company for funds owed to that company. 

  • CTX - Corporate Trade Exchange

Corporate Trade Exchange transfers in the ACH network are used by corporations and government agencies to pay trading partners.

  • IAT - International

An International ACH Transaction is an ACH entry that is part of a payment transaction involving a financial agency's office that is not located in the territorial jurisdiction of the United States.

  • POP - Point of Purchase Entry

The Point of Purchase ACH format allows an integration with a point of purchase or swipe terminal, triggering a single entry ACH debit transaction for in-person purchases made at the point of purchase.

  • PPD - Prearranged Payment and Deposit Entry

Prearranged Payment and Deposit used to pay or collect from personal (consumer) accounts including direct deposit of payroll to employees, payments to individuals and collections of consumer funds.

  • RCK - Re-Presented Check Entry

The Re-Presentation Check Entry format is used to represent a returned check. It enables an ACH debit transaction to re-present a paper check after the paper check has been returned for either insufficient or uncollected funds.

  • TEL - Telephone-Initiated Entry

The Telephone-Initiated Entry format is used when an oral authorization is recorded for an ACH debit. 

  • WEB - Internet Initiated Entry

An Internet Initiated Entry is used for the origination of debit entries (recurring or one-time) to a consumer's account based on an authorization that is obtained by the recipient via the internet.

Nacha File Format Fields

When dealing with Nacha payment files and formats, there are several fields and records required to make an ACH transfer happen. 

  • File header — The file header provides basic information about the NACHA file including who the payer is and which bank is handling the initial processing.
  • Batch header — The batch header includes specific information about the payment including the standard entry class, description of payments, and effective date.
  • Detailed transaction record — This record contains the payment details and includes banking information related to the recipient  and the amount of payment.
  • Addendum — The addendum is an optional record that sometimes accompanies Nacha files, primarily for corporate-to-corporate transactions.
  • Batch control total — This record appears at the end of each ACH batch process and contains totals for each batch.
  • File control record — This is a final check on the payment batch and data submitted. It lays out the block and batch counts as well as the totals of each type of entry.


What is the Difference Between ACH and Nacha?

What is ACH? The Automated Clearing House (ACH) Network is an electronic funds-transfer system run by Nacha, also known as the National Automated Clearing House Association, since 1974. So, in many ways, ACH and Nacha work in tandem, and serve different purposes. The ACH network falls under the umbrella of the self-regulated association with very specific Nacha rules for participants to abide by. 

What are the Benefits of ACH for B2B Payments?

Using ACH for debits and credits has benefits for individual consumers as well as business-to-business transfers.

  • The ACH network is less expensive than other “payment methods” because processing can be batched together vs. individual payment processing.
  • With ACH payments, businesses eliminate the need to process paper checks, saving time and reducing human error. 
  • Automation means that businesses don’t need to worry about making or receiving payments each month. With the appropriate permissions, money can be automatically sent or pulled from an account. 
  • It’s also faster. Instead of waiting for traditional mail, all of the payments are processed digitally, so you can send and receive money faster.


Is your business ready to benefit from Nacha and the ACH network? Envestnet | Yodlee provides proven solutions for safer and faster processing of ACH transitions using our account verification and payment solutions. Together, we can empower your organization to offer flexible payment options while saving time and money.