How much processing lead time is required for direct deposits to be made on time?

Author: Ryan F. Donovan

NACHA (The Electronic Payments Association) holds that a three-business-day lead time should exist between processing of direct deposits with the bank and payday. This three-day window does not include banking holidays or weekends. Many banks and payroll processors will still make deposits on time for clients who submit just one or two days prior to payday but an employer should avoid this. While larger banks will typically get the money there on time, they are not legally obligated to do so. Smaller banks and other institutions may have a slower turnaround time.