What type of entry allows only the Originator's financial institution to remove funds?

The term "Credit Entry" refers to a type of transaction in the Automated Clearing House (ACH) network that enables the Originator's financial institution to initiate a payment that adds funds to a recipient's account. In this context, only the Originator's financial institution has the authority to remove those funds from the Originator's account to process the transaction.

This mechanism is vital for transactions where the recipient (the receiver) does not have any repercussions over the funds being removed, ensuring that control remains with the financial institution that initiated the entry. This control is crucial for maintaining the integrity of the payment system and the trust between financial institutions and their customers.

On the other hand, Debit Entries involve withdrawing funds directly from an account, which allows for different circumstances where parties outside the Originator's financial institution may have a say, potentially leading to less control over the funds. Wire Transfers are usually immediate and not governed by the same rules as ACH entries, and they usually require different protocols. ACH Entries encompass both debit and credit transactions, thus they do not specifically define the nature of control regarding fund removal.

Understanding the nature of Credit Entries and their relation to the control exercised by the Originator's financial institution is essential for anyone working within the ACH framework.