Direct deposit saves you a trip to the bank on payday, as long as you provide the right banking information to your payroll processor.
In most cases, the bank will catch the error and return your money to your employer rather than making the deposit in the wrong account.
What happens if direct deposit goes to closed account?
Rejected Bank Deposits
If the account closes before you can cancel the transaction, the money will get sent to the closed account. The company will not issue a check or forward the money to another account until the direct deposit funds are returned.
What happens if you deposit money into the wrong account?
What Happens If the Bank Makes a Deposit Into the Wrong Account? Although it’s unlikely, it is possible for a deposit to be mistakenly credited to the wrong person’s checking account. When this happens, the bank will reverse the transaction and credit it to the correct account, but it can affect a number of things.
How long does a bank have to correct an error?
In general, errors must be reported within 30 to 90 days from the bank statement date. When it comes to an electronic funds transfer, you have up to 60 days. In the case of loss due to a fraudulently endorsed check, you have up to one year. Time frames may vary, so check with your banking institution.
Can a direct deposit be reversed?
Yes. The national NACHA (The Electronic Payments Association) guidelines say that an employer is permitted to reverse a direct deposit within five business days. Assuming that no applicable state laws override that, this is the guideline the employer must follow.