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Working With Pre-notes

Pre-notes (prenote notifications) test bank account information before processing actual deposits. They verify that routing and account numbers are valid without transferring funds.

Pre-notes are no longer mandatory under NACHA regulations, but some banks and ACH processors may still require them for new direct deposit setups.

When Pre-notes Are Required

Check with your ACH processor or bank to determine if pre-notes are required for:

  • New employee direct deposit setups
  • Changes to employee bank information
  • Bank-specific compliance requirements

Creating Pre-notes

If pre-notes are required, you must manually edit the NACHA file after exporting:

  1. Export the direct deposit file as normal from Client Functions > Electronic Processing > Employee Direct Deposit Bulk (or Employee Direct Deposit Single Co for single-company processing).
  2. Open File Explorer and navigate to the ProPay directory.
  3. Go to the directory containing the NACHA file.
  4. Type: `EDIT filename.TXT` (using the actual filename).
  5. Locate Type "6" records (lines starting with "6").
  6. For each Type 6 record, edit columns 2-3 (Transaction Code):

Transaction Code Changes

Original Code Description Change To Pre-note Type
22 or 32 Credit to employee 23 Prenote Credit
27 or 37 Debit to employer 33 Prenote Debit
  1. Change the amount field to 0.00 for each pre-note record.
  2. Save the file.
  3. Upload the pre-note file to your ACH processor.

Important: Pre-note files do not transfer actual funds. After pre-notes are verified (typically 3-5 banking days), process regular direct deposits.

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