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Introduction to
Automated Clearing House (EG-ACH)
EG-ACH Direct Credit and Direct Debit
Copyright © 2012
EG-ACH Introduction
 The Egyptian Automatic Clearing House (EG-ACH) is a nationwide
Electronic Funds Transfer (EFT) network.
 EG-ACH processes batches of interbank Credit and Debit transactions.
 EG-ACH facilitates a wide range of Customer to Customer (C2C) payments
such as salary distribution, supplier payment, governmental payments,
pension distribution and many more.
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CBE - Payment and Settlement Systems
 In its effort to develop payment systems in Egypt,

CBE has established Real Time Gross Settlement (RTGS) system for large
value payments,

CBE has assigned EBC with the development of the Automated Clearing
House (ACH) system for Bulk small value payments.
Central Bank of Egypt
Banks
RTGS
CCH
EGP
ACH
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Mobile
CCH
Banks
USD, EURO
EBC Role
CBE Role
Copyright © 2012 Egyptian Banks Company
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RTGS vs. ACH
RTGS
ACH
 High value, low volume
 High volume, Low value
 Time critical
 Non-urgent
 Individual PI processing
 Batch PI processing
 Bi-lateral settlement
 Multi-lateral settlement
 Real time
 Session/ Window concept
 Direct credit only
 Direct credit & direct debit
 Irrevocable after settlement
 Cancellation or rejection prior to
settlement at RTGS
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EG-ACH Direct Credit
Copyright © 2012
Direct Credit Workflow
Originator Bank
Beneficiary Bank
Originators
 Corporates
RTGS
 Individual
Fund Movement
Beneficiaries
 Corporates
 Suppliers
 Individual
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Direct Credit Usage
 Customer-initiated transactions (e.g., money transfer)
 Corporate-to-corporate payments (supplier payments, etc…)
 Payrolls-private and government
 Pensions-private and government
 Government supplier payment
 Dividends
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EG-ACH Direct Debit
Copyright © 2012
EG-ACH Direct Debit Service
 Payment scheme governed by EBC to facilitates payment collections.
 Permits billers to collect recurring amount due from their customers at
their banks by initiating direct debit transaction.
 Banks are not responsible for any underlying contract between biller and
their customers as it is solely an early collection method.
 Based on a written authorization given by customers to biller for the debit
of their accounts; this written authorization named Direct Debit Mandate.
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Direct Debit Usage
 Utility payments
 Credit card bill payment
 Corporate-to-corporate payments
 Insurance payments
 Mortgage and installment loan payments
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Definitions and Interpretation
 Debtor (Customer or Payer)
 Creditor (Biller or Originator)
 Debtor bank (Customer bank)
 Creditor bank (Biller bank)
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Direct Debit Workflow
Creditor Bank
Debtor Bank
Creditor
 Billers
Debtor
RTGS
 Company
 Individual
Fund Movement
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Definitions and Interpretation
 Mandate Processor:

Receives the signed mandate from the debtor, dematerializes the mandate,
archives a scanned copy of the mandate and forwards the electronic
mandate information to EBC and send the physical mandate to the debtor
bank.
 Third Party Processor:

Delivers direct debit transactions to EG-ACH on behalf of originator banks.
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What about the Direct Debit Mandate
 Direct Debit Mandate (DDM) should be approved by the Debtor Bank prior
to direct debit transaction initiation.
 EBC has taken the responsibility of providing mandate centralized
screening system “Mandate Portal” with following features:

Host all direct debit mandates in an electronic form (e-mandate)

Screen each direct debit transaction against the respective mandate

Allowing the debtor bank to activate/deactivate particular mandate
 Mandate Portal:

A central hub for mandate business workflow which facilitates collecting
and routing the dematerialized Mandates between the different parties
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Direct Debit Mandate Types
 Irrevocable Mandate

Irrevocable transactions

Payment frequency as per contract terms and conditions

Could be canceled based on mutual agreement between Debtor and Creditor
 Revocable Mandate

Revocable transactions

Payment frequency is required (Monthly, Quarterly, Semi-Annual, Annual)

Could be canceled upon Debtor request
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Direct Debit Mandate Initiation
Mandate
Processor
Biller
Activate
Archive
Fill
Mandate
Debtor
Bank
Send
Copyright © 2012 Egyptian Banks Company
Mandate Portal
Packing
Payer
Dematerialize
Courier
Deliver
Physical Mandate
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Direct Debit Workflow & Screening
Creditor Bank
Debtor Bank
Mandate Portal
Creditor
 Billers
Debtor
 Corporate
RTGS
 Individual
Fund Movement
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Direct Debit Participants
EBC
Third Party
Processor
Mandate
Processor
Creditor
Bank
Debtor Bank
Scheme Owner
and Operator
Work on behalf
the banks
Collect
mandates
Host creditor
account
Host debtor
account
Mandate Portal
Provider
Send DD
transactions
Dematerialize
mandates
DD transaction
initiator
Activate
Mandate
Screening
Receive DD
transactions
Archive
mandates
Clearing and
Settlement
Send mandates
to debtor bank
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Copyright © 2012 Egyptian Banks Company
Creditor
(Biller)
Review &
Fill Missing
Data
Print
Mandate
Review &
Fill Missing
Data
Final Status
Report
Dematerialize
Mandate
View
Accepted
/Rejected
Mandates
Send
Physical
Mandate to
Bank
Final Status
Report
Creditor
Bank
Print
Mandate
Mandate
Processor
Detailed Mandate Cycle
Final Status
Report
Final Status
Report
Cancel
Mandate
Fill & Sign
Mandate
Portal
Debtor
(Payer)
Debtor
Bank
Compare
Physical
against
Electronic
Validate &
Check
Business
Rules
Register
Final Status
Sync with
EG-ACH
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Copyright © 2012 Egyptian Banks Company
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Copyright © 2012 Egyptian Banks Company