How to Set Up Direct Deposit to Your Bank

Learn how to get direct deposit and skip an extra trip to the bank.


Direct deposit is highly popular: 82 percent of Americans with access to direct deposit take advantage of the service, according to NACHA, the Electronic Payments Association; 87 percent reported being highly satisfied and 72 percent reported that direct deposit helps them better control their finances.

Convenience is one of the major advantages of direct deposit. Electronic money transfers eliminate the risk of losing a check and don’t require the account holder to visit a bank branch to make a transaction. Timing is another one of its appeals because traditional checks might be subject to clearing periods of as long as a week and direct deposit funds are available in as little as a day. So you can save yourself some effort and time, learn how to set up this payment feature and start enjoying the perks of direct deposit.

What Is Direct Deposit?

Direct deposit is a system that moves funds electronically into accounts at banks and other financial institutions. It’s an alternative to the traditional method of making deposits into accounts via paper checks, and is commonly used for deposits associated with:

  • Paychecks
  • Tax refunds
  • Government benefits
  • Employee expense reimbursements
  • Annuities and interest payments

Learn: 20 Ways Direct Deposit Helps You Become Rich

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How to Get Direct Deposit Set Up

Although direct deposit setup procedures and requirements can vary slightly depending on your employer and financial institution, signing up for direct deposit usually follows a universal process. Follow these steps to set up direct deposit:

1. Verify your financial institution is an ACH member.
2. Ask your employer if direct deposit is available. If not, tell your company’s human resources department that you’re interested in direct deposit.
3. Ask your employer for a direct deposit authorization form. Most direct deposit authorization forms ask you to provide:

  • Your bank’s routing number: The routing number is the nine-digit sequence on the bottom left corner of your checks. On some checks, it might be the middle number, coming after the individual check number at the far left.
  • The checking account number: The account number is on the bottom of your check to the right of the routing number. It’s the number you use for all transactions. Some banks allow direct deposits to savings accounts or other accounts as well, in which case you’d supply that account number.
  • A voided check: Employers might require a voided check to validate your financial information. Write the word “void” in large letters across one check and attach it to your direct deposit authorization form — but don’t write over the routing or checking numbers.
  • Your bank’s address: Provide the address of your bank’s local, brick-and-mortar branch.

4. Submit your direct deposit form to your employer and monitor your bank account to ensure your deposits are processed correctly. Some employers allow you to set up direct deposits to multiple accounts — such as directing a portion of your paycheck to your checking account and a portion to your savings account. If you want to set up more than one direct deposit, ask your employer if you need to fill out a separate authorization form for each account or if you can list more than one account on a single form.

Read: Here’s the First Thing You Should Do With Every Paycheck

How to Set Up Direct Deposit for Benefits and Other Payments

You’ll need to find out the payer’s specific process for setting up direct deposit if you want your tax refund, benefits or other payments to be directly deposited into your bank account. If you conduct your transactions with the payer online — such as by e-filing your taxes, for example — you’ll most likely be prompted on that payer’s website to provide your bank’s routing number and your bank account number to receive the direct deposits.

If you’re not currently conducting your transactions or business online, call or visit the government office or company that’s sending you checks and request a direct deposit authorization form. You might also be able to set up direct deposit through your bank, credit union or other financial institution. The Social Security Administration, for example, allows people who receive benefits to sign up for Social Security direct deposit through their own financial institutions.

Related: How to Stop Automatic Withdrawals

How Does Direct Deposit Work?

Direct deposits are any ACH credit payment from a business or government to a consumer, according to NACHA. The ACH network conducts 90 percent of the total value of all monetary transfers between financial institutions — nearly 25 billion transactions for a total of more than $43 trillion annually.

If you sign up for direct deposit, it’s likely that ACH will be the network moving the money between your employer or another company and your bank. Major banks — including Bank of America, Wells Fargo and Chase — as well as many credit unions and smaller banks are ACH members, and therefore offer direct deposit. You don’t have to be a customer of the same bank as your employer or any other company or government office in order to receive direct deposit, as long as both financial institutions offer the service.

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Direct deposit is free to recipients, and many financial institutions waive fees associated with various banking services if you participate in direct deposit. Some banks waive fees associated with their checking accounts if you have money directly deposited into checking each month — this is known as a recurring deposit.

See: 10 Best National Banks of 2017

The many benefits of direct deposit make it an option you should consider. In addition to being safe, fast and convenient, direct deposit makes money management easier by reducing instances of overdraft. Direct deposit funds are generally available on the day of the deposit, and when you don’t have to wait days for a paper check to be processed, you can more easily manage your incoming and outgoing funds. Moreover, employers generally schedule paychecks to be directly deposited on the business day before a holiday, according to the Electronic Payments Association, so you have faster access to your money.


Editorial Note: This content is not provided or commissioned by the bank advertiser. Opinions expressed here are author’s alone, not those of the bank advertiser, and have not been reviewed, approved or otherwise endorsed by the bank advertiser. This site may be compensated through the bank advertiser Affiliate Program.

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About the Author

Andrew Lisa has been writing professionally since 2001. An award-winning writer, Andrew was formerly one of the youngest nationally distributed columnists for the largest newspaper syndicate in the country, the Gannett News Service. He worked as the business section editor for amNewYork, the most widely distributed newspaper in Manhattan, and worked as a copy editor for, a financial publication in the heart of Wall Street’s investment community in New York City.