Direct credit payments are made via an ABA file. An ABA file is a specially formatted text file that can be uploaded to your bank in order to send payments to your investors via electronic funds transfer.
To generate an ABA file during the payment process, you must first fill in the bank details in your company profile. Check with your financial institution whether they require ABA files to have a self-balancing row.
Direct credit list
Before generating an ABA file for a payment, you can review the Direct credit list by clicking on Direct credit in the Calculated payment amounts table on the Payment details page. Here you can see the payment details and status for each direct credit payee.
Paying direct credit payees
Once you have scheduled a payment, you can pay your investors via direct credit:
- On record date, in the Payment details view, you will be able to download an ABA file from the ABA files section.
- Set the ABA payment date. Initially, this will be the payment date for the dividend. Subsequent payments may be required where payments to an investor fail or if the investor has not provided their bank details by the Payment date. See handling failed payments for further information.
- Click Download ABA file. After the file has downloaded and you've uploaded it to the bank, answer the following question: Did your bank accept the ABA file?
- If your bank accepted the ABA file, click Yes, the file was accepted to set all Direct credit payees to 'Paid' in the Direct credit list. Any failed or returned payments can be handled by changing the status of the failed payment from 'Paid' to 'Retained' in the Direct credit list or by updating the payee's bank details. Once bank details have been updated you can generate a new ABA just for those payees.
- If the file was rejected because of a particular payee then click the No, the file was rejected button. Once an investor's bank details have been updated, a new ABA file can be downloaded and re-uploaded to the bank
- Once you have confirmed the ABA file upload, you can click the View ABA file details link to see a list of payments to be made. The list contains the following fields from the investors recorded banking information:
- Account name
- ABA reference no
- Account number
- Direct credit (this is the amount to be paid to the investor)
- At this point, the status for each payment in the ABA file will be automatically set to Paid unless the investor is missing bank details. In which case, the status will be set to Payment retained - no bank details. See handling failed payments for more information on dealing with failed payments.
Once you have paid your investors via direct credit, you can send them their payment statements.