TN 31 (01-08)

A. Introduction

The contract for Canadian International Direct Deposit (IDD) allows IDD to either Canadian or U.S. dollar accounts at Canadian financial institutions. Although it is convenient for many Canadian beneficiaries to receive their benefits in Canadian dollars, others prefer to receive their benefits in U.S. dollars. There are three types of coding to accounts in Canadian FIs; it is important to know exactly which coding to use. Understanding the coding also helps you identify where the payments are going if a problem occurs.

NOTE: U.S. domestic (i.e., non-border) field offices (FOs) should not attempt to process an IDD request for this country. U.S. domestic FOs must forward all appropriate information to the Office of Earnings and International Operations, Division of International Operations (OEIO, DIO) for processing (For more information on forwarding IDD information, see GN 02402.205C, GN 01010.255, and GN 01702.310C).

1. Canadian Dollar Accounts

This is the traditional IDD to Canada. Benefits are converted to Canadian dollars by Federal Reserve Bank of Kansas City (FRBKC) at an excellent rate a few days before the payment date. The prefix for the routing and transit number (RTN) is 51. The procedure for coding IDD to Canadian dollar accounts in Canada is at GN 02402.300D.

2. U.S. Dollar Accounts (Other than Royal Bank of Canada)

This choice allows a beneficiary to receive the exact amount of the benefits in U.S. dollars at the beneficiary's U.S. dollar account in Canada. The prefix for the RTN is 62. If IDD to U.S. dollar accounts in Canada is erroneously coded with prefix 51, the payments reject and are returned to SSA. The procedure for coding IDD to U.S. dollar accounts at FIs in Canada is at GN 02402.300E.

3. U.S. Dollar Accounts at Royal Bank of Canada (RBC)

If the beneficiary's U.S. dollar account is at RBC in Canada, special coding allows SSA to send the benefits in U.S. dollars through RBC's branch in New York, Routing and Transit Number (RTN) 026004093. RBC set up this branch, which does not itself have accounts, to move direct deposit payments to the correct branch and account in Canada. Because this is a U.S. bank, no special prefix is needed.

In the Depositor Account Number field, the coder keys the 5-digit branch number and the 7-digit account number.

Because this is treated as U.S. direct deposit, Treasury processes any nonreceipt or reclamation actions for these payments. The FO/TSC/PC follows the same procedures as for any U.S. direct deposit nonreceipt, or payment after death. No forms are sent to FRBKC for these actions. These actions by Treasury reduce the workload for SSA. Therefore, this is the preferred method of coding U.S. dollar accounts at RBC.

The procedure for coding IDD to U.S. dollar accounts at RBC in Canada is at GN 02402.300F.

B. Description - Source of the Bank Information

The data for coding may come from a check, a signup form for Canada (see GN 02402.300G.), or the equivalent information received by mail, phone, fax, or E-mail.

If the interviewer does not have access to a check or a signup form completed by the FI when the beneficiary makes a request for direct deposit by phone, the interviewer should ask the beneficiary to read all the numbers from the bottom of the check (the MICR line).

The interviewer should also ask for the check serial number at top right. This information is also included at the bottom of the check, so knowing the check number makes it easier to determine the actual bank data.

For U.S. dollar accounts, the actual account number may be in small print above the words “PAY TO THE ORDER OF.” For a U.S. dollar account at a Caisse Populaire, the number may be in rather small print toward the upper right.

When using a Canadian Payments Association Directory to find the bank data, the coder must use the information from the second column (“MICR Encoded No.”), not the first column (“Direct Payment Routing No.”).

The beneficiary may have a Pre-Authorization Statement from the FI. This gives the full information.

C. Description of Canadian Bank Data

Following is a description of the bank data for Canadian dollar accounts.

1. MICR Line on a Check

• The printed data (MICR line) at the bottom of a Canadian check consists of four groups of digits and special symbols, in the following order:

• The check number, usually 3 digits, starting at the left side of the check. This is not to be coded for direct deposit. On checks from some banks, this information may be between other elements, rather than the first three digits.

• The branch code (or transit number) of 5 digits followed by a dash. The dash is not to be coded for direct deposit.

• The institution code of 3 digits. All Canadian institution codes contain 4 digits, but only the final three are shown on the MICR line. The initial zero (which is not shown on the MICR line but is shown in the “Direct Payment Routing No.” column in the Canadian Payments Association Directory) should never be coded for SSA's IDD to Canada. FRBKC puts in the lead zero automatically. If SSA codes a zero before the three-digit institution code, the final digit of the institution code will be read by the processor bank as the first digit of the depositor account number, and the institution code is read as an incorrect or invalid code. The payment will be rejected at the processor bank.

• The Canadian account number, which may contain both digits and dashes. The account number dashes should not be coded. However, dashes are required for the following exceptions to the rule.

EXCEPTION 1: The dash before the 7th digit must be coded for a Caisse Populaire account at institution # 815 or 829. All seven digits are shown in the MICR line, but the numbers at the top of the check contain the account (“folio”) number followed by the check serial number (check number 14, for example). The beneficiary usually knows only the portion of the account number (folio) that is shown at the top of the check. This information contains no lead zeros and no check digit (the seventh digit). To make sure the beneficiary provides complete information during a phone interview, the interviewer should ask the beneficiary to read first the full MICR line and then the numbers at top right

EXCEPTION 2: The dash before the 6^th (next to last) digit, which is always a 2, must be coded for a Caisse Populaire at institution #865.

NOTE: The account number in the MICR line (following the institution number) may include all or a portion of the branch number at certain banks. If so, this must be included in the account number coding.

2. Signup Form for Canada

The completed Canadian signup form contains the branch code, institution code, and account number. It also tells whether this is a Canadian or U.S. dollar account. See GN 02402.300G. for an exhibit of the signup form.

3. Bank Data Characteristics

The information in this section is given to help you:

• avoid rejected payments for beneficiaries residing in Canada, and

• correct the problem after a payment to an account in Canada is returned for incorrect routing or account information.

a. U.S. Dollar Accounts

The following table tells how to recognize a U.S. dollar account at some Canadian FIs.

b. Other Characteristics of Account Numbers

The following table describes characteristics of account numbers at certain Canadian FIs. Payments sent to these FIs will reject if the account numbers do not have these characteristics. However, many Canadian FIs are changing the format of their account numbers so that all or a portion of the branch number is coded before the actual account number. Information that is given to SSA in this format should be coded as given.

D. Procedure - Coding Direct Deposit for Canadian Dollar Accounts in Canada

Follow these steps to code direct deposit of Title II benefits to Canadian dollar accounts at FIs in Canada.

1. Is the beneficiary's address on the MBR in a foreign country (PCOC = 8)? If no, STOP.

   REASON: The MBR will not accept the International Direct Deposit (IDD) information if the address is in the U.S.

2. Code the Account type for Checking or Savings. If you do not know which it is, code it as Checking.

3. If you receive the information by phone and do not have a check copy, ask the beneficiary to read all the numbers at the bottom of the check. Write down those numbers. Ask the beneficiary to read the check serial number at top right. Find the check serial (or sequence) number in the MICR line you've written down (usually the first 3 digits), and line through it. Remember not to code the check serial number.

4. Code the Depositor Account Number field

   • Start with the 3-digit institution code (which follows the 5-digit branch code on a check). Do not code a dash before or after the institution code. Do not code the check serial (sequence) number. Do not code a lead zero before the 3 digits of the institution code.

   • Code the account number. If the account is in a Caisse Populaire at institution #815 or 829, code a dash before the 7^th digit, which is the check digit. If the beneficiary gives you fewer than 7 digits for a Caisse Populaire account number, ask the beneficiary to read you the MICR line of a check, so you will have the 7^th digit. If the account is in a Caisse Populaire at institution #865, code a dash before the next to last digit (the 6^th digit, which is always 2). For any other FI, do not code any dashes.

   REASON: The Canadian account number field can contain up to 12 characters. For some FIs, if you include the dashes, the total number of characters will exceed 12. FRBKC drops any characters beyond the 12 when formatting a payment for the Canadian system. The payment then contains incorrect account information and may reject or be deposited to the wrong account.

5. Code the Routing and Transit Number field.

   • Start with 51, the prefix SSA has designated for Canadian dollar IDD.

   • Code the 5 digit branch code/transit number.

   • Add a zero (0).

   • Add the U.S. check digit. Obtain the check digit by using the Check Digit Code program on Title II/Interactive Comps.

EXAMPLE 1: Ms. Canadienne requests direct deposit to her Canadian dollar account at a Caisse Populaire, branch number 12345, institution number 815, account number 123456-7. Federal Reserve Bank of Kansas City codes her RTN 511234501. (The final digit, 1, is the U.S. check digit for 51123450.) Her DAN is 815123456-7.

EXAMPLE 2: Ms. Beneficiary presents a check for her Canadian dollar account with the following information at the bottom of the check:

237 00236-003 156-789-4.

The coder sorts the information as follows:

Check Number: 237

Branch Code: 00236

Institution Code: 003

Account Number: 156-789-4

The Routing and Transit Number will be: 510023603. (The final digit, 3, is the U.S. check digit for 51002360.) The Depositor Account Number will be: 0031567894.

E. Procedure - Coding Direct Deposit for U.S. Dollar Accounts at Banks in Canada Other Than Royal Bank of Canada

Follow these steps to code direct deposit of Title II benefits to U.S. dollar accounts at FIs in Canada, except see Royal Bank of Canada, GN 02402.300F.

1. Is the beneficiary's address on the MBR in a foreign country (PCOC = 8)? If no, STOP.

   REASON: The MBR will not accept the International Direct Deposit (IDD) information if the address is in the U.S.

2. Code the Account type for Checking or Savings. If you do not know which it is, code it as Checking.

3. If you receive the information by phone and do not have a check copy, ask the beneficiary to read all the numbers at the bottom of the check. Write down those numbers. Ask the beneficiary to read the check serial number at top right. Find the check serial (or sequence) number in the MICR line you've written down (usually the first 3 digits), and line through it. Remember not to code the check serial number.

4. Code the Depositor Account Number field.

   • Start by coding the 3-digit institution code (which follows the 5-digit branch code on a check). Do not code a dash before or after the institution code. Do not code the check serial (sequence) number. Do not code a lead zero before the 3 digits of the institution code.

   • Code the account number. If the account is in a Caisse Populaire at institution #815 or 829, code a dash before the 7^th digit, which is the check digit. If the beneficiary gives you fewer than 7 digits for a Caisse Populaire account number, ask the beneficiary to read you the MICR line of a check, so you will have the 7^th digit. If the account is in a Caisse Populaire at institution #865, code a dash before the next to last digit (the 6^th digit, which is always 2). For any other FI, do not code any dashes.

   REASON: The Canadian account number field can contain up to 12 characters. For some FIs, if you include the dashes, the total number of characters will exceed 12. FRBKC drops any characters beyond the 12 when formatting a payment for the Canadian system. The payment then contains incorrect account information and may reject or be deposited to the wrong account.

5. Code the Routing and Transit Number field.

   • Start with 62, the prefix SSA has designated for IDD to a U.S. dollar account in Canada.

   • Code the 5 digit branch code/transit number.

   • Add a zero (0).

   • Add the U.S. check digit. Obtain the check digit by using the Check Digit Code program on Title II/Interactive Comps.

EXAMPLE 1: Mr. Client requests direct deposit to his U.S. dollar account at a bank in Canada. The branch code is 54321, the institution number is 004, and the account number is 54327234567. DIO codes the RTN 625432105. (The final digit, 5, is the U.S. check digit for 62543210.) DIO codes the Depositor's Account Number as 00454327234567.

EXAMPLE 2: Mr. Benefit requests direct deposit to his U.S. dollar account. His letter gives the name and address of his bank, and his account number, 70-13. The border FO looks up the bank information in the Canadian Payments Association directory and finds that the bank is branch # 42440, bank code 002. For 002, the account number needs 7 or 12 digits, so the FO codes zeroes in front of the given account number to make it 0007013. (The FO does not code the dash.) The RTN is 624244006. The DAN is 0020007013.

F. Procedure - Coding Direct Deposit for U.S. Dollar Accounts at Royal Bank of Canada (RBC) in Canada

Follow these steps to code direct deposit of Title II benefits to U.S. dollar accounts at RBC in Canada. (See GN 02402.300D. if this is a Canadian dollar account at RBC.)

1. Code the Account Type as Checking or Savings. If you do not know the type, code it as Checking.

2. Code the Routing and Transit Number field 026004093. Do not code a 51 or 62 at the front of the RTN field.

3. Does the account number start with 9? If so, change the 9 to a 0 (zero).

4. Code the Depositor Account Number field by coding the 5-digit branch number, which starts with 0, followed by the 7-digit account number, which begins with 4 or 8. Use the account number that is shown in very small print above the words “PAY TO THE ORDER OF.”

EXAMPLE: Ms. Smith brings a check when she visits an SSA field office to sign up for direct deposit of her SSA benefits to her U.S. dollar account at Royal Bank of Canada. The FO codes the RTN as 026004093. The branch number, which consists of the first 5 digits after the RTN in the MICR line, is 91442. The account number, in very small print above the “PAY TO” line, is 4545678. The FO changes the 9 at the beginning of the branch number to a zero (0) and codes the Depositor Account Number as 014424545678 (the 5 digit branch/transit number followed by the 7 digit account number).

G. Exhibit - IDD Enrollment Form for Canada

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