Payments
What is this use case?
In this use case, a Payment is the transfer of funds.
How have others used it?
Payments are commonly useful for a variety of uses:
- Account-to-Account (A2A) payments to send money directly to an account
- Person-to-Person (P2P) payments to send money to anyone
- Accept online payments for ecommerce
- Pay a bill
- Pay a loan
How do I use it?
You may have multiple options for payments, depending upon which Jack Henry products and services are being used at your financial institution.
Faster payments
If your institution has iPay and Payrailz, then you might want to use them for faster payments which can make funds available within minutes.
- Note that transactions may settle between financial institutions later through Automated Clearing House (ACH) or debit card networks.
Services like Zelle® or Payrailz Pay A Person℠ are often used for faster payments.
They often rely upon faster payments capabilities such as:
- Real-Time Payments (RTP®) Network from The Clearing House® (TCH)
- FedNow® Service from the Federal Reserve.
Open Loop vs. Closed Loop Systems
One important distinction between different P2P providers is whether they offer an open loop or closed loop solution. A closed loop solution allows the sender to pay anyone if they are also a user of that same solution. For instance, a PayPal user can pay any other PayPal user, but they can’t pay someone who doesn’t use PayPal. That’s because PayPal, like Venmo and Zelle, is a closed loop system.
Open loop systems, on the other hand, allow users to pay anyone, regardless of whether they are part of the solution used by the sender. This eliminates the need for the sender to know which solutions the receiver uses, and the receiver doesn’t have to disclose their PayPal, Venmo, or Zelle account name to the sender. Instead, open loop systems allow the sender to initiate payment using more common identifiers like an e-mail address or a phone number.
Zelle®
Zelle is a payment solution operated by Early Warning Services, a payments company owned by a group of the nation’s largest financial institutions.
Zelle P2P is a closed loop system, but because it is run by the nation’s largest banks there are more than 100 million people with access to it (About one-third of Americans surveyed—36%—report using it.)
While Zelle funds are typically available to the recipient within minutes, transactions settle between financial institutions later through the ACH or debit card networks.
Payrailz Pay A Person℠
Payrailz Pay A Person is an open loop system.
Recipients can receive funds without having to download an app or join a network.
One-time and recurring payments can be made and delivered on the same-day, the next-day, or a designated future date using the good funds settlement model – which virtually eliminates the risk of overdrafts with pre-funded payments.
Recipients can choose to deposit funds directly into a checking or savings account, or as a credit to their debit card.
In the background, Pay A Person can use the ACH network or debit card rails to deliver the funds, with support for instant payments through the RTP Network and the FedNow Service.
Traditional payments
If your financial institution has the JHA SmartPay Platform™, then you may want to use that platform for traditional payments.
Automated Clearing House (ACH)
Automated Clearing House (ACH) transactions are electronic credits or debits sent by originating companies through the banking system to post against a checking, savings, or loan account of the recipient.
The ACH system has the advantages of processing batches of payments and processing fees which may be lower than other payment alternatives.
Jack Henry offers two APIs for ACH payments:
- SmartPay Transaction Processing API
- SmartPay Payment Vault API
Remote Deposit Capture (RDC)
Remote Deposit Capture (RDC) is a way for consumers to make deposits by simply snapping a picture of a check and submitting the image through their financial institution’s mobile banking application.
Jack Henry offers multiple services for RDC payments:
- JHA SmartPay Remote Deposit Anywhere™ (RDA)
- JHA SmartPay Remote Deposit Complete™ (RDC)
- JHA SmartPay Remote Deposit Now™ (RDN)
- JHA SmartPay mRDC™ (Mobile Remote Deposit Complete)
- Ensenta Business Remote Deposit Capture™ (bRDC)
- Ensenta Business Mobile™
- Ensenta Consumer Mobile™
Next steps
Read the developer docs for the API which makes the most sense for your solution: