What Happens to My Check If My Bank Account Linked to Direct Deposit is Closed?
Recently, a scenario has been discussed where an individual working at Walmart discovered that their direct deposit bank account had been closed. This prompted questions about whether their check would still be received, or if it would be delayed, and what steps they could take to ensure future paychecks are not affected.
Direct Deposit Failure
When an employee's direct deposit bank account is closed, the initial payment attempt will likely fail due to the non-existence of the account. The direct deposit transaction will be rejected by the bank, leading to the following outcomes:
Direct Deposit Failure
Transaction Failure: The direct deposit attempt from your employer to your closed account will be rejected because the account no longer exists. Employer Notification: Your employer will likely receive a notification of the failed deposit and might follow up with you to request updated banking information.Employer Notification and Updates
When your employer is informed about the failed direct deposit, they might take several actions, such as:
Contact: They may reach out to you to obtain your new banking details, ensuring future deposits go through smoothly. Inform HR: In many cases, employers will direct you to contact the HR or payroll department for assistance.Paper Check Option
Depending on your employer's payroll policies, they might issue a paper check if they cannot successfully complete the direct deposit. This process involves:
Timing Delay: The issuance of a paper check can take some time, and your next paycheck may be delayed if this happens. Reprocessing: Once you provide updated banking information, your employer can reprocess the direct deposit.Updating Your Information
To prevent any disruptions in your paycheck, it is crucial to update your direct deposit information promptly:
HR Contact: Notify your HR or payroll department immediately. Provide New Account Details: Ensure your employer has the correct account numbers for future deposits. Ensure Accuracy: Verify that the new information is correctly recorded in your system to avoid further issues.Reopening an Account with the Same Bank
If you closed an account at one bank but later reopened a new account with the same institution, the deposit should automatically go to your new account. However, if you reopen an account at a different bank, you would need to:
Notify Walmart’s Payroll: Inform your store's payroll department about the new account information. Maintain Accuracy: Ensure the payroll system is updated with your new bank details to facilitate correct processing.General Guidelines and Cyber Space Myth-Busting
It's important to address the myth about checks “traveling” through cyberspace. This is not accurate, as automated systems handle these situations efficiently. When a direct deposit is sent to a closed account, the bank returns the funds, and your employer then works to resolve the issue with the correct information.
Mr. Marcum's answer is correct, as there are specific automated procedures in place. Updates need to be provided in a timely manner to avoid delays in your paychecks.
By following these steps and ensuring accurate information is provided, you can minimize disruptions and secure prompt receipt of your paychecks.