Earlier this month, the City of Shelton began electronically depositing city employee’s payroll into their personal bank accounts using direct deposit services. The month of May happens to be Direct Deposit and Direct Payment via ACH Month, which is celebrated annually by the National Automated Clearing House Association (NACHA). During Monday’s City Commission meeting, Jim Morrell, Vice-Chair of the Board of Directors for NACHA recognized the City’s Finance Director, Nola von Nuedegg, and Accounting Manager, Meegan Crossan, for their efforts in making the successful transition to direct deposit.
Prior to making the switch, the City of Shelton paid its employees primarily with physical paychecks. Department supervisors were responsible for paycheck distribution and reporting. Employees were then required to make arrangements to get their paychecks to their respective banking institutions, which usually involved driving to a bank, waiting in line, and occasionally, taking time off from work to get to a bank during normal banking hours. In addition to being vulnerable to a variety of security risks, physical paychecks created several obstacles that were inefficient for both the payroll staff and employees. The new direct deposit system saves city employees time and money, improves processing efficiency, and improves financial management security systems.
Vice-Chair Morrell commended the City’s Finance Department stating, “The effort to setup an organization such as the City of Shelton does not just happen without a lot of hard work, vision, and guidance. There is a tremendous amount of detail that goes into implementing direct deposit. Meegan Crossan meticulously ensured that every piece of account information was confidentially handled and entered into the direct deposit system. City employees rely on this effort to ensure that they receive their payroll, which they depend upon to support their households.”
The City of Shelton is now part of the national ACH Network, which is governed by NACHA. Since 1974, NACHA – The Electronic Payments Association has served as trustee of the ACH Network, managing the development, administration and rules for the payment network that universally connects all 12,000 financial institutions in the U.S. by moving money and information directly from one back account to another. Financial institutions exchange 25 billion ACH payments valued at $43 trillion annually. Through its collaborative, self-governing model, NACHA supports the more than 12,000 financial institutions it represents with such activities as direct deposit.