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A Guide to Understanding Who’s Who in the Payments Networks
Bank of First Deposit
A Third-Party Sender is one type of Third-Party Service Provider when acting as an intermediary between its Originator and the Financial Institution (ODFI).In this type of relationship, the Third-Party Sender process entries on the behalf of and for the benefit of the Originator through an agreement with their ODFI. The Third-Party Sender has an agreement with both the Originator and the ODFI. The ODFI does not have a direct agreement with the Originator.
In this model the merchant (Originator) has an ACH Origination Agreement directly with the Financial Institution (ODFI) and an agreement with the Third-Party Service Provider for some aspect of ACH Processing. In some cases, the ODFI may require the Originator to identify the Third-Party Service Provider in a Tri-Party Agreement.
In this model there are two Third-Party Service Providers, one offers a service to the Originator based on an agreement the Originator holds with the ODFI and the second Third-Party Service Provider acts as a Sending Point for the ODFI.
In this model the Third-Party Sender has an agreement with both the ODFI and Nested Third-Party Senders. Nested Third-Party Senders hold Agreements with their Originators which are the ultimate beneficiary of entries.
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