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The Authorization Agreement for Direct Payments serves as a crucial document in establishing automated payment relationships between businesses and their customers or service providers in the United States. This agreement is essential for compliance with federal regulations, including the Electronic Fund Transfer Act and NACHA rules. It provides authorization for recurring payments, specifies payment terms, includes necessary banking information, and outlines both parties' rights and responsibilities. The document is particularly important in today's digital economy where automated payments have become standard practice for recurring transactions.

1. Parties: Identifies the parties entering into the agreement (payment originator and account holder)

2. Background: Brief context about the purpose of the direct payment arrangement

3. Definitions: Key terms used throughout the agreement

4. Authorization: Explicit authorization for direct payments, including payment details and schedule

5. Bank Account Information: Details of the account from which payments will be withdrawn

6. Payment Schedule: Timing and frequency of payments

7. Termination: Conditions and process for terminating the authorization

8. Signature Block: Space for signatures and dates