Currently, our Bank Originates ACH transations for a handful of customers to pay the customer's loan here at our Bank with funds from another Bank. I am thinking that the CIE (customer initiated entry) is the proper code to code these transactions. Others are saying the PPD (prearranged payment and deposit entry) code is the correct code.

I'm going with CIE because it indicates that the Originator is usually an individual whereby the PPD indicates the Originator is usually a business entity. Also, my thinking is that the CIE code allows the Bank to get around the complicated binding agreements required by NACHA (Article 2.1.1).

Any thoughts?

Your loan customer's loan at your bank is being paid out of their checking account at another bank? Did they sign a document stating they wanted this? I think the Originator here could be the ODFI. I'm pretty sure it is. So to know for sure - are you originating a debit or a credit? I'm going to guess you're originating a debit (to their checking account at other bank). If so, it cannot be a CIE as a CIE is only a credit.

Yes that is correct - a loan here at our Bank is being paid with customer funds from another Bank via ACH. Our Bank does have signed agreements on file from the customers stating that this is what they want.

So you are saying that you think our Bank, and not the individual customer is considered the Originator? I could see that.

Our Bank is Originating a debit from the customer's account at the other Bank to credit the loan account here at our Bank. So yes I can see how CIE won't work. The more I thought about it I think CIE is more for something that mirrors a bill payment service.

So are you thinking that PPD is probably correct then?

Yes, my impression here is that the PPD is the best SEC code to use in this scenario (a debit, to a consumer account, written authorization...)