Direct Deposit Procedures

August 14, 2020


Most employees in the United States are paid with direct deposit because of its cost and convenience benefits to both employers and employees. The direct deposit process starts with the employer establishing direct deposit capabilities with their bank and then paying out payroll via the Internet using the bank's software. No traditional "hard copy" check is written. The costs to employers vary from bank to bank and state to state. The bank may charge set-up fees depending on the size of the employer and relationship with bank and some banks may also charge ongoing monthly service fees.

 Direct deposit benefits for employers include:

  • Reduced risk of check fraud and lost or stolen checks
  • Timely payment of payroll checks, even when employees are away
  • No delay on when checks are “cashed”
  • Online transaction reports available immediately

 Direct deposit benefits for employees include:

  • Timely depositing of checks
  • Reduced time required for checks to clear
  • Reduced chance of losing checks or having them stolen


 Steps to Set Up and Process Direct Deposit with Your Bank

1. The employer needs to contact their bank representative (at the bank where they hold an operating/payroll account) and ask if they offer direct deposit and if the bank has the capability of having a “NACHA” file uploaded thru their website.

  • If preferred, please connect your bank contact with your accountant, D & S Management Services, to help with this crucial step.

2. The bank will provide the employer with documents to complete in order to initiate the set-up process. Banks sometime refer to the documents as “ACH payment set up”.

  • Once the platform is set up, the employer will need to set their accountant up as a user and give them access to the account.
  • Some banks require “dual authentication”, so two people at your accounting provider would need online access.
  • Some banks require the use of a token to log into the account AND to authorize/approve the direct deposit file uploaded.
  • If“dual authentication” is necessary, then two tokens may be needed.  
  • The employer would need to request the token(s), and have it mailed to your accountant’s office.
  • Not all banks require a token, some prefer a cell phone for access/approval process.

3. An individual from the bank’s Treasury Management Department will contact your accountant to discuss direct deposit set up.

  • Your accountant will work with the bank’s representative to configure their accounting software’s ACH field setup to the bank’s requirements.

4. Once the setup is complete, the accountant will schedule a time to test out the NACHA file. This test is done one of two ways:

  1. Email the bank representative the NACHA file, or
  2. A test website/platform is set up to upload the file.

If the test is unsuccessful, the accountant will go back and adjust their ACH field setup and try again.

5. While the above set up process with the bank is under way, the employer should begin gathering the routing and account numbers of their employees and share this information with their accountant.

  • Your accountant will provide you with a standard form to have your employees complete.
  • To prevent errors, it is imperative to avoid any handwritten routing/account numbers.  
  • Generally,your accountant will request a voided check or something official from the bank that is computer generated and shows the routing/account numbers.
  • Deposit slips are NOT accepted.



The entire direct deposit process normally takes 4-6 weeks to implement. Due to the complexity of the process and the time invested, we only recommend direct deposit to employers who plan to commit all employees. As mentioned above, some of the benefits of switching to direct deposit include no longer having to disburse payroll checks or track down lost employee checks. In addition, direct deposit provides added security to your business’s routing and account number,preventing potential check fraud. The direct deposit process can be time consuming and confusing, especially when you’re running Domino’s franchises. You have a lot on your peel, let us at D & S Management Services help you with all your accounting needs.

We're Ready To Help With All Your Domino's Needs
Prospect, New or Veteran Franchisee,
No Matter, We're Ready To Help