Receiving Depository Financial Institution
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Receiving Depository Financial Institution aka RDFI, is the institute which receives the ACH Automated Clearing House's transaction for posting to receiver's account. RDFI is the interface between the Receiver's account and the Cards Association network. All the Originating Depository Financial Institution (ODFI) are by default RDFI but all the RDFIs are not ODFI by default.
The transaction posted by RDFI can be debit or credit which always considered from the receiver's perspective.
For example, consider a case when a person buying goods from the shop and is paying by credit card to shop keeper (who is termed as Merchant). The person originating the ACH transaction is termed as "Originator" and the Merchant is ternmed as "Receiver". As the merchant's account is going to get credited, this transaction is called as "ACH Credit Transaction".
In another case when a person is subscribed to automatic bills payment, the institute initiating the transaction instruction becomes the "Originator" while the person becomes the "Receiver". In this case as the Receiver's account is going to get debited, this is called as "ACH Debit Transaction".
