Direct Deposit Processing Speeds

Processing speed refers to the time it takes for Zoho Payroll to debit funds from your business bank account and deposit them into your employees’ bank accounts once you approve a payroll. It also determines how close to the pay date you can approve a payroll. That is, up to 3 or 2 business days in advance, depending on your organization’s processing speed.

Types of Processing Speeds

Zoho Payroll offers three types of processing speeds:

• 3-day processing speed
• 2-day processing speed
• 1- day processing speed

3-Day Processing Speed

All organizations start with the 3-day processing speed by default.

• Approval deadline: At least 3 business days before payday.
• Fund debit date: 1 business day before payday.
• Salary deposit date: On payday.
• Example:
  • If payday is Friday, you must approve the payroll by Tuesday. Your business bank account will be debited on Thursday, and employees will receive their salaries on Friday.

2-Day Processing Speed

You may become eligible for 2-day processing speed based on your organization’s payroll history and bank verification. When eligible, your processing speed will be updated automatically.

• Approval deadline: Up to 2 business days before payday.
• Fund debit date: 1 business day before payday.
• Salary deposit date: On payday.
• Example:
  • If payday is Friday, you must approve the payroll by Wednesday. Your business bank account will be debited on Thursday, and employees will receive their salaries on Friday.

1-Day Processing Speed

You may also become eligible for 1-Day Processing based on your organization’s payroll history and bank verification. When eligible, you can purchase this as an add-on.

This is an employee-specific add-on. That is, you only need to purchase add-ons for employees who are paid via direct deposit. For example, if 4 out of your 10 employees are paid through direct deposit, you can buy 4 add-ons.

Learn how to purchase the 1-day processing speed add-on.

Once purchased, the payrolls in your organization will be the below timelines:

• Approval deadline: Up to 1 business day before payday.
• Fund debit date: On the day you approve payroll (1 business day before payday).
• Salary deposit date: On payday.
• Example:
  • If payday is Friday, you must approve the payroll by Thursday. Your business bank account will be debited on Thursday, and employees will receive their salaries on Friday.

How Holidays Affect Processing Speeds

Weekends and US federal bank holidays are not considered business days. When a scheduled payday falls on one of these days, it will move to the previous business day. The approval deadline also shifts accordingly.

Examples:

1. 3-day processing speed: If payday is a Monday bank holiday, payday shifts to the previous Friday. You must approve the payroll by the preceding Tuesday.
2. 2-day processing speed: If payday is a Monday bank holiday, payday shifts to the previous Friday. You must approve the payroll by the preceding Wednesday.
3. 1-day processing speed: If payday is a Monday bank holiday, payday shifts to the previous Friday. You must approve the payroll by the preceding Thursday.

Things to Keep in Mind

• Weekends and US federal bank holidays are not considered business days.
• Always maintain sufficient funds in your bank account (covering both salaries and taxes) before the fund debit date.
• Payment failures due to insufficient funds or incorrect account details may affect your eligibility for faster processing speeds.