What is a direct deposit?

A direct deposit refers to the automatic deposit of an employee's paycheck into their bank account by their employer. This process eliminates the need for physical checks, providing a more efficient and secure way to receive earnings. Direct deposits are typically arranged by the employee and require the provision of bank account details to the employer, allowing for regular and timely payment without the need for manual intervention.

The concept of direct deposit streamlines the payroll process for both employees and employers, reducing the logistical challenges associated with issuing physical checks and minimizing the risk of check-related fraud or loss, making it a preferred method of payment in many organizations.