Which type of ACH Entry represents the transfer of funds into an account?

Which type of ACH Entry represents the transfer of funds into an account?

• A. Debit Entry
• B. Credit Entry
• C. Check Entry
• D. Loan Entry

Answer: (B)

A Credit Entry in the ACH network signifies the transfer of funds into an account. This type of entry is used for transactions where money is deposited or added to a recipient's account, such as payroll deposits, government benefits, or any payments made to an individual or business. The essential function of a Credit Entry is to increase the balance of the receiving account. In contrast, a Debit Entry is utilized for withdrawing funds from an account, such as bill payments or recurring charges. Check Entry isn't a standard term used within the ACH framework, as checks and ACH are separate payment processes. Loan Entry is also not applicable in this context since it doesn't denote the mechanism of allocating funds into a depositor's account within the ACH system. Understanding the distinction between Credit and Debit Entries is crucial, as it forms the foundation of recognizing how funds move through the ACH network.

A Credit Entry in the ACH network signifies the transfer of funds into an account. This type of entry is used for transactions where money is deposited or added to a recipient's account, such as payroll deposits, government benefits, or any payments made to an individual or business. The essential function of a Credit Entry is to increase the balance of the receiving account.

In contrast, a Debit Entry is utilized for withdrawing funds from an account, such as bill payments or recurring charges. Check Entry isn't a standard term used within the ACH framework, as checks and ACH are separate payment processes. Loan Entry is also not applicable in this context since it doesn't denote the mechanism of allocating funds into a depositor's account within the ACH system.

Understanding the distinction between Credit and Debit Entries is crucial, as it forms the foundation of recognizing how funds move through the ACH network.