ACH Service Terms

Last Updated: December 10, 2021

By using Block, Inc.’s (“Square,” “we,” “our,” or “us.”) ACH Service, you agree to be bound by the General Terms of Service (“General Terms”), the Payment Terms (“Payment Terms”), these additional terms and conditions (“ACH Service Terms”) and all other terms, policies and guidelines applicable to the ACH Service. You agree that the ACH Service shall be deemed part of (and included in) the definition of “Payment Services” under the Payment Terms. If you are using the ACH Services on behalf of a business, that business accepts these terms. Defined terms have the same meaning as in the General Terms.

Square is a Third Party Sender under the Nacha Operating Rules, and will authorize ACH Entries on your behalf.

1. ACH Service.

Square, as a Third Party Sender under the Nacha operating rules, offers services that allow you, as Originator, to initiate Automated Clearing House (“ACH”) debit or credit Entries to your customers’ (Receivers’) accounts (the “ACH Service”), and you desire to use such services. To offer the ACH Service, Square works with an ODFI, and you hereby authorize Square’s ODFI to originate Entries on your behalf.

You agree to pay the fees that you owe us for using the ACH Service.

2. Fees.

You will pay Square the fees and charges as agreed in writing, as well as other amounts owed, pursuant to these ACH Service Terms and Section 4 of the Payment Terms. Such other amounts shall include, without limitation, any amounts charged to Square, the underlying ODFI, or you by Nacha, the administrator of the ACH Network, in connection with your use of the ACH Service.

You agree to the Nacha Operating Rules. We may change your transaction limits by providing you notice.

3. Transaction Limits.

You shall operate and use the ACH Service in accordance with the transaction limits approved by Square and in accordance with the Nacha Operating Rules. Square may modify your transaction limits at any time upon reasonable notice to you.

The ACH Service currently supports WEB debit entries.

4. Types of Entries.

Square will transmit Entries that you initiate that fall within the following ACH Standard Entry Class (“SEC”) Codes: WEB.

You agree to the Nacha Operating Rules and all other laws and regulations that apply to your use of the ACH Service.

5. Compliance.

You agree to comply with the rules, guidelines and bylaws of Nacha (available on the Nacha website) and other applicable laws and regulations related to the operation and use of the ACH Network, which may include Uniform Commercial Code Article 4A or Regulation E, as each is amended from time to time. The foregoing rules, guidelines, bylaws, laws and regulations shall all be deemed part of (and included in) the definition of “Network Rules” and Nacha shall be included in the definition of “Networks,” both as defined in the Payment Terms.

You are responsible for obtaining authorizations to debit your customers’ bank accounts. We won’t be responsible for any return, reversal or other failure from your failure to obtain your customer’s authorization for an ACH debit transaction.

6. Authorizations.

You are solely responsible for obtaining authorization to debit your customer’s bank accounts for ACH Entries and you are solely responsible for ensuring such authorizations comply with the Network Rules and applicable law. You further agree that you shall retain authorization for each such Entry for two (2) years after termination or revocation of such authorization or for such other period as required by the Network Rules. When you use the ACH Service to initiate ACH Entries to your customers, you represent and warrant that you have all necessary authorizations and approvals from your customer for Square to originate an ACH debit or credit Entry to the customer’s bank account and that each such Entry is accurate and timely. You further warrant that any debit Entry that you initiate satisfies an obligation or corrects an error. Square shall not be liable for any return, reversal or other failure (or any related costs) arising from your acts and omissions, including failure to obtain your customer’s authorization for an ACH debit transaction. Square is permitted to document and store ACH authorizations, including timestamp and applicable ACH credentials.

You or Square may terminate your use of the ACH Services according to these terms. We may also suspend or terminate your use of the ACH Service if you fail to maintain sufficient funds in your Square account to pay any amounts you owe, violate the Nacha Operating Rules, or if the ODFI (our banking partner) requires it.

7. Suspension and Termination.

In addition to the term and termination rights set forth in Section 35 of the Payment Terms, either party may terminate any or all Payment Services in accordance with their rights under the Payment Terms, including the ACH Service. Square may suspend or terminate your use of the ACH Service for violation of any Network Rules, including, without limitation, acceptable limits for ACH returns and failure to maintain funds in your Square account to satisfy your obligations under these ACH Service Terms. Square may also terminate or suspend the ACH Service if the ODFI requires such suspension or termination.

Your funds will be available to you when the ODFI (our banking partner) receives the funds. If we decide to make those funds available to you before then, we have the right to a refund from you if the ODFI never receives the funds.

8. Settlement.

You acknowledge that funds paid to you by your customers through the ACH Service shall only be made available to you once the ODFI receives final settlement. In the event that Square makes available to you any provisional credit and such ODFI does not receive the final settlement, the ODFI is entitled to a refund for the amount of the provisional credit. You agree that you shall be responsible for all such refunds, and Square shall have the right to be reimbursed and recover such refunds or other amounts that are charged to Square by the ODFI in connection with the ACH Service pursuant to these ACH Service Terms and the Payment Terms.

Once an ACH entry is made, you won’t be able to cancel, amend or reverse the ACH transaction.

9. Cancellation, Amendment, Reversal.

You shall not have the right to cancel, amend, or reverse an ACH Entry after its receipt by Square. However, Square may, in its sole discretion, use reasonable efforts to act on your request to cancel, amend or reverse an Entry before transmitting to the ACH Network or processing it as an on-us Entry. Square shall have no liability if it fails to effect such requests.

We and the ODFI have the right to reject an ACH Entry.

10. Rejection.

Square or the ODFI may reject any Entry, including an on-us Entry, which does not comply with the requirements of these ACH Service Terms or the Network Rules, and may reject any Entry if you are not otherwise in compliance with these ACH Service Terms. In addition, the ODFI may refuse to process an Entry you initiate in its sole discretion. You shall be responsible for correcting any Entries rejected by Square or ODFI prior to resubmission.

We may receive a return or reversal of an ACH entry after the transaction has settled. You agree to hold sufficient funds in your linked bank account, and we have the right to recover any amounts you owe us due to a return or reversal.

11. Returns.

When using the ACH Service, you understand and agree that it may take more than 60 days for Square to receive notice a return or reversal of an ACH Entry and for Square to exercise any of our rights granted or reserved under these ACH Service Terms, the Payment Terms, or the Network Rules. You agree to maintain a sufficient balance in your linked bank account to satisfy all obligations to Square in connection with your use of the ACH Service, including returns, reversals, and associated fees, and to add funds immediately if Square notifies you that your funds in your linked bank account are insufficient. Square reserves the right to recover all outstanding amounts due to Square in accordance with the Recovery Authorizations set forth in Section 2 of the Payment Terms.

You agree to use the ACH Service for legal purposes only. You agree that your use of the ACH Service won’t cause Square to violate the law.

12. Violation of Laws.

You represent, warrant, and covenant to Square, as an Originator of Entries made under the Operating Rules, that (a) you will not seek to use the ACH Service in violation of any applicable law or regulation; and (b) no Entry delivered to Square or the ODFI, if accepted by the ODFI, will cause Square or the ODFI to be in violation of any regulation or sanction administered by the federal or state government or otherwise causes Square or the ODFI to be in violation of federal or state law.

You will allow us, the ODFI, or any third party auditor that we choose to inspect and review your policies and procedures for complying with these terms and the Nacha Operating Rules.

13. Audit and Review.

You agree to permit Square and the ODFI and their designated third parties to audit, inspect, and review your policies and processes for purposes of ensuring your compliance with these ACH Service Terms and the Network Rules. You agree to cooperate with any such audit and to respond to reasonable requests for information necessary to complete such audit in a timely manner.

We won’t be liable for anything the ODFI or a third party does that prevents us from providing you with the ACH Service.

14. Additional Limitation of Liability.

In addition to Section 18 of the General Terms, Square shall not be liable for any action or inaction by ODFI or a third party (e.g., the ACH operator or RDFI) that results in Square’s failure to perform under these ACH Service Terms or suspension, termination, restriction or other delay in Square’s performance under these ACH Service Terms.

If you do something using the ACH Service that gets us sued or fined, you agree to cover our losses as described below.

15. Additional Indemnity.

In addition to Section 33 of the Payments Terms, you will indemnify, defend, and hold us and our processors (and our respective employees, directors, agents, affiliates and representatives) harmless from and against any and all claims, costs, losses, damages, judgments, Tax assessments, penalties, interest, and expenses (including reasonable attorneys’ fees) arising out of any claim, action, audit, investigation, inquiry, or other proceeding instituted by a person or entity that arises out of or relates to (a) your breach of any representation, warranty or covenant set forth in these ACH Service Terms, (b) your failure to perform your obligations as an Originator under the Network Rules, (c) your failure to maintain a sufficient balance in your Square account to cover your obligations under these ACH Service Terms, (d) Square’s effecting or attempt to effect your request for the cancellation, amendment or reversal of an Entry, or (e) Square’s issuance of duplicate Entries.

These ACH Service Terms are part of the Payment Terms.

16. Relationship to Payment Terms.

These ACH Service Terms are hereby incorporated into and made part of the Payment Terms. To the extent the ACH Service Terms conflict with the Payment Terms, these terms shall control with respect to the ACH Service and only to the extent of such conflict.

See below for important definitions that are used in these terms.

17. Definitions.

• “ACH Network” means the funds transfer system (network) governed by the Nacha operating rules which provides for the clearing of electronic entries for participating financial institutions and Third-Party Senders.

• “Entry” is an order or request for the transfer of money to the account of a Receiver or general ledger account of an RDFI (a “credit Entry”); or an order or request for the withdrawal of money from the account of a Receiver or general ledger account of an RDFI (a “debit Entry”). “Entry” may also refer to the transmission of notice or data that is not an order or request for the transfer or withdrawal of funds.

• “ODFI or Originating Depository Financial Institution” means a financial institution that originates ACH Entries on behalf of Sellers.

• “Originator” means a person that has authorized an ODFI to transmit an Entry to a Receiver’s account at an RDFI.

• “RDFI or Receiving Depository Financial Institution” means a financial institution qualified by Nacha to receive ACH Entries.

• “Receiver” means a person that has authorized an Originator to initiate a credit Entry, debit Entry, or non-monetary Entry to the Receiver’s account at the RDFI.

• “Third-Party Sender” is an organization that is not an Originator that has authorized an ODFI to transmit, for its account or the account of another Third-Party Sender, a credit Entry, debit Entry, or non-monetary Entry to a Receiver’s account at an RDFI. Square acts as a Third-Party Sender in conjunction with the ACH Service.