The ACH file must have the word PAYROLL in Company/Batch Header Record 5, position 54-63 effective 3/20/26.

NACHA changes effective 3/20/26 include adding the work "Payroll" to the ACH file generated when Manually sending ACH File for Direct Deposit payments. 

Nacha Risk Management Topics-Company Entry Descriptions

This doesn’t effect any payments made by Check or through the Sage Direct Deposit Processing application.

NACHA's change to the Operating Rules for Company Entry Descriptions is effective March 20, 2026.  All ACH originators are to use the specific description "PAYROLL" for direct deposit payments of wages and salaries.  This is to combat fraud, along with implementing enhanced risk-based fraud monitoring for all ACH transactions, phased in throughout 2026. This field is customizable in Direct Deposit Maintenance.

Sage Engineering is working on a resolution to change the Company Entry Description to PAYROLL if blank in Direct Deposit Maintenance. This is on the roadmap and tentatively scheduled for the Sage Payroll 2.26.2 release in July 2026.

 

Workaround:

 

1. Select Payroll_Direct Deposit_Direct Deposit Maintenance.
2. Go to the Records Tab. (Displays tab only if Manually Send ACH File.).
3. Populate Company Entry Description with the word "PAYROLL" and Accept.

ID 119051