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Integration Guide: Selecting the Correct ACH SEC Codes

To ensure high processing success rates and compliance with NACHA (National Automated Clearing House Association) guidelines, it's important to use the correct Standard Entry Class (SEC) code.

Using the wrong code can lead to transaction rejects, compliance fines, or extended dispute windows. Zift supports the following ACH SEC codes:

  • CCD
  • PPD
  • POP
  • TEL
  • WEB

Use this guide to map your payment flow to the correct SEC designation.

For Developers: The SEC code is used in ACH transactions as the transactionIndustryType parameter in an ACH sale request.

Quick Reference Decision Tree

  1. Is the Payer a Business or a Consumer?

    • Business Account: Use CCD.

    • Consumer Account: Proceed to step 2.

  2. How is the payment being authorized?

    • Via Website/Mobile App > Use WEB

    • Via Phone Call > Use TEL

    • Via Signed Paper/Digital Form > Use PPD

    • Via Physical Check at Counter > Use POP

SEC Code Definitions

CCD (Corporate Credit or Debit)

Use Case: B2B Payments (Invoices, Vendor payments). If your client is a business paying another business via an online link, use CCD. Even though it happens online, the business-to-business nature of the account takes precedence over the "web" medium.

  • ACH Dispute Window: 2 Business Days.

WEB (Internet Initiated Entry)

Use Case: E-commerce, Online Bill Pay (Consumer). Used for any ACH debit authorized by a consumer via a website or mobile application.

  • Compliance Note: NACHA requires Account Validation (e.g., instant bank verification or micro-deposits) for the first transaction with any new consumer account under the WEB code.

PPD (Prearranged Payment and Deposit)

Use Case: Recurring Subscriptions, Payroll, Membership Fees. Used when a consumer provides a standing authorization (usually via a signed document or digital equivalent) to debit their account on a set schedule.

  • Compliance Note: You must provide the consumer with a copy of the authorization.

TEL (Telephone-Initiated Entry)

Use Case: Call Center Payments, Phone Collections. Used when a consumer gives oral authorization over the phone.

  • Compliance Note: You must either record the call or send a written confirmation of the details to the customer before the funds settle.

POP (Point-of-Purchase)

Use Case: In-person Retail. Used when a consumer presents a physical check at a physical location. The check is scanned for routing/account info and then returned to the customer.

  • Compliance Note: A signed receipt and a posted notice at the point of sale are required.

Why Correct Coding Matters

Risk Factor Business (CCD) Consumer (WEB/PPD/TEL)
Dispute Window Strict 2-Day Limit. Once settled, it is very difficult for a business to reverse a CCD. 60-Day Window. Consumers have significant protections and a long window to claim a transaction was "unauthorized."
NACHA Audit Low risk if the contract is clear. High risk. Incorrectly using PPD for a WEB transaction can result in fines for failing to perform required account validations.

Integration Tips for Developers

  • Logic Check: If your UI collects a "Company Name," your backend should ideally default the SEC code in the transactionIndustryType parameter to CCD.

  • Validation: For WEB transactions, ensure your integration includes an account verification step to meet the NACHA "WEB Debit Account Validation" rule. 

Need help with specific API parameters?

Contact our Integration Support Team.