In April 2020, we began offering early ACH credit postings to our members. Essentially, many members may receive their direct deposits up to two days earlier than normal.
If you make your loan payments with cash and/or an automated transfer, you will need to manage your account to make sure you do not withdraw your money PRIOR to your loan(s) payments posting. Your loan payment due date will not change.
Please make sure your account remains funded for any transfers you have requested.
If you are not using SmartLink home banking or the mobile app, we encourage you to sign up for free text alerts so you know when your money is deposited.
If you have any questions about this change, please contact your local VBSFCU office.
Q: What is Direct Deposit and how does it work?
Direct Deposit is an Automated Clearing House (ACH) transaction that is a safe, proven, confidential method of receiving payment. With Direct Deposit, money is electronically transferred into a checking or savings account.
Q: Is Direct Deposit for everyone?
It is an important employee benefit. It is an excellent financial planning tool because it allows people to divide their pay into as many different accounts as they wish. Saving or investing automatically this way adds up.
Q: How many people use Direct Deposit?
Nearly 65 percent of workers receive one or more payment via Direct Deposit. Research conducted by the Federal Reserve in 1998 found that 97 percent of consumers using Direct Deposit are very satisfied.
Q: Why don’t more people use Direct Deposit if it has been around for so long?
Some employers do not offer it and some employees may not understand the societal benefits prefer paper checks. Usage will increase when people understand how much it can eliminate fraud and abuse and save the government, companies, and consumers millions of dollars a year.
Q: Are checks safe?
According to a study by Tinucci & Associates for NACHA, “While the banking system itself is secure, the sheer number of times a check must be passed from hand to hand while it is being processed means there is less security available.” In short, checks are usually safe, but Direct Deposit is safest. For banks, check fraud is a $4.3 billion annual problem. Direct Deposit can eliminate these problems. It is the most private, safe, proven way to transfer money.
Q: What is the relative cost versus checks?
Direct Deposit saves the government, companies, the country, and individuals an enormous amount of money. For consumers, total direct and indirect costs of depositing a check instead of using Direct Deposit is $5.88, according to the study Tinucci & Associates. Small companies with 2,500 employees can save $1,200 a month using Direct Deposit instead of paper checks. Large companies of 30,000 employees can save $16,200 a month. The 8.9 billion ACH transactions in 2002 saved the United States over $14 billion using the Federal Reserve’s estimate that society saves about $1.62 per ACH transaction vs. checks. The government spends an average of 51 cents more to process a check than an electronic transfer.
Q: Is it good for consumers?
Direct Deposit is secure, convenient and fast. A Direct Deposit payment has never been lost; it saves consumers from waiting in lines at their financial institution and gives many people access to their money earlier.
Q: Is is governed by any laws?
The Federal Reserve Banks’ “Regulation E” and NACHA’s operating rules regulate Direct Deposit. Additional rules pertaining to government payments.
Q: Can employers require employees to use Direct Deposit?
Many states allow companies to mandate Direct Deposit. However, it is so beneficial that most employees want to use it voluntarily. Check your state’s labor codes for details.
Q: Won’t I lose the float from my pay period?
The savings you will realize far outweigh any money earned from check float.
Q: How do I sign up?
Your human resources or payroll department can give you the authorization form. If it is not available, ask your human resources officer to consider offering direct deposit. Your financial institution should also have information for you.
Q: How do I know when my payment has been deposited?
Most employers continue to issue a pay stub with Direct Deposit. It will show how much is deposited in your account and how much is took out for taxes, insurance, and other items. Your financial institution can tell you exactly when the money is available in your account.
Q: Why should I help save my employer money?
Most employees understand a stable and healthy company provides a reasonable measure of job security, as well as benefits the community and country.
Q: Can I divide my pay among different accounts?
Yes, you can deposit your pay into as many accounts as you choose. Many people save money using this method by automatically depositing a portion of their pay into a savings account.
Q: Can it be used for other reimbursement systems?
It is used for expense reimbursement, travel advances and any other form of payment.
Q: How often will I have a problem?
Problems are rare. In fact, you are 10 times more likely to have a problem with a check. As the Tinucci & Associates study says, “Direct Deposits really cannot be lost.”
Q: When can I access my money?
Your payment is available to you at the opening of business the morning of payday. Your financial institution can tell you exactly when your money is available.
Q: What happens if I change banks?
Just fill out a new authorization form and provide your written permission to switch accounts.
So now you learned about Direct Deposit! Is your next stop a car or personal loan?
Visit our Loan Center page and jump to learn more!
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