PPD – an ACH Transaction Code

These abbreviations relate to an 'application' kind, and facilitate confirm the detail record format. ACH applications are classified as being either client or company payments, counting on the connection between the parties.

PPD - Prearranged Payment and Deposit Entry

A debit application where the companies with billing operations may involve with the ACH through electronic transfer (direct debit) of bill payments. Through standing authorizations, the patron grants the corporate authority to initiate periodic charges to their account as bills become due.

PPD transactions are defined by those who are approved in writing on a type or contract that grants a business permission to debit a consumer’s personal checking or bank account.

This is used for credit transactions such as direct deposit of payroll, pension, dividends, as well as debit transactions such as payment of utility bills, mortgages, loans and other recurring payments.

One-Time PPD Transactions

One-time PPD transactions are usually used as a part of a contract once a client is creating one payment for products or services rendered. Let me give you an example.

·        Paying for a year of service before when a contract is signed.

·        Making a significant purchase like furnishings, art, or a second user vehicle.

·        Placing an order for a product or service that may be beaked fully on a future date.

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