Prenote
Many finance and HR professionals will be familiar with prenotes, but other colleagues may not have heard of this type of transaction.
A prenote (or prenotification) is a zero-dollar test to validate the employee bank account information. Prenotes are sent and verified before direct deposit payroll can be processed.
A prenote test transaction gets sent to the bank to make sure the provided employee account information is valid before setting up a direct deposit transfer to pay the employee.
After the bank routing and account numbers are entered, the prenote status is pending. After the prenote period has passed, the status changes to complete.
An employee direct deposit bank account prenote status must be complete before direct deposit payroll can be processed and deposited into that bank account.