Benefits of Direct Deposit(s) for Employees

Paycheck via Direct Deposit

Giving employees the option to have their payroll funds deposited via direct deposit into their banking account(s) is both a convenience and a benefit for them and an employer.

Employees do not have to take the time to make the trip to their bank or worry about losing their paycheck.

For the company, the direct deposit liability is debited from the company’s account in one “lump sum” so the company saves the hassle of reconciling and tracking live checks written on their account. Multiple accounts can be configured, including savings and investment accounts too.

Direct Deposit Benefits

If you are an employer, to ensure a smooth transition and avoid potential issues when starting or changing an employee’s direct deposit, please keep the following guidelines in mind:

  • ABA outing Numbers are nine (9) digits in length
  • Routing Numbers starting with the number five (5) are NOT valid and will generate a banking return
  • Do NOT obtain the routing number from a deposit slip—please use a voided check or a bank supplied specification sheet
  • Always obtain and file any documentation of the employee’s account information or direct deposit request
  • The first two digits of the ABA Routing Number must be in the ranges of 00 through 12, 21 through 32, 61 through 72, or 80. Detail on each category are as follows:
    • 01 through 12 are “normal” routing numbers
    • 00 is used by the United States Government
    • 21 through 32 were assigned only to credit unions and savings banks through the year 1985 and are currently still in use by long-established institutions
    • 61 through 72 are used for electronic transactions
    • 80 is used for traveler’s cheques

If you have any questions or concerns, please contact the Pacific Payroll at 949.215.3769 for further discussion. We have direct deposit authorization forms available, should you need them.

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