# Transaction Types and Fund Flows

The **Virtual Account Service (VAS)** supports several types of transactions, each designed for specific business purposes. These transactions define how funds move between **Sub Accounts**, **Parent Accounts**, the **Settlement Account**, and ultimately **external counterparties**.

## Overview of Transaction Types

- **Authorized Customer Debit Transactions**
Corporate Clients can initiate a debit from a Customer’s Sub Account (with proper authorization). Funds move **up** the hierarchy — from Sub → Parent → Settlement — before being transferred externally.
- **Authorized Customer Credit Transactions**
Corporate Clients can credit a Customer’s Sub Account. Funds move **down** the hierarchy — from Settlement → Parent → Sub — usually representing inbound funding.
- **Deposit and Withdrawal Operations**
These handle customer funds entering or exiting the VAS environment. All deposits and withdrawals are subject to validation, monitoring, and audit.
- **Settlement Processes**
These finalize payments with external counterparties. The Settlement Account is always the source for outbound flows and the recipient of inbound funds.


## Transaction Codes and Flows

The following codes define the types of transactions supported within VAS:

| Transaction | Direction | Use Case |
|  --- | --- | --- |
| `ACRT` – Authorized Credit Transfer | Settlement → Parent → Sub | Funding virtual accounts (customer credits) |
| `ADBT` – Authorized Debit Transfer | Sub → Parent → Settlement | Consolidating funds (customer debits) |
| `OTWT` – Withdrawal Transfer | Sub → External | Withdrawals to customer’s same-name external accounts |
| `OTST` – Settlement Transfer | Settlement → External | External payments on behalf of customer |
| `REVERSAL` – Reversal | Reject inbound | Reject unauthorized or invalid inbound funds |


## Transaction Flows Explained

### Deposits (External → Sub Account)

- A Customer initiates a transfer from an **external bank account** to a specific **Sub Account IBAN**.
- Only **pre-approved, registered external IBANs** will be accepted.
- If the source account matches, funds are credited to the Sub Account and made available.
- If the source account does **not** match, the funds are held for **BCB investigation**.


### Authorized Customer Debit Transactions (Sub → Settlement)

- Corporate Client initiates a request to **debit a Sub Account** and **credit the Settlement Account**.
- Flow:
  1. Debit from Sub Account → credit to Parent Account.
  2. Immediate transfer from Parent Account → Settlement Account.
- If the Sub Account has **insufficient funds**, the transfer is rejected, and the Corporate Client receives a notification.


### Authorized Customer Credit Transactions (Settlement → Sub)

- Corporate Client initiates a request to **debit the Settlement Account** and **credit a Sub Account**.
- Flow:
  1. Debit from Settlement Account → credit to Parent Account.
  2. Transfer from Parent Account → Sub Account.
- If the Settlement Account has **insufficient funds**, the transfer is rejected, and the Corporate Client is notified.


### Withdrawals (Sub → External)

- A Customer requests a withdrawal via the Corporate Client.
- The Corporate Client initiates a transfer request to BCB.
- Funds flow: Sub Account → Customer’s designated **external account** (within BCB or another bank).
- If the Sub Account has **insufficient funds**, the transaction is rejected, and the Corporate Client is informed of the reason.


### Settlement Transfers (Settlement → External Counterparty)

- Corporate Client initiates an outbound payment from the **Settlement Account**.
- Funds flow: Settlement Account → Counterparty’s account (internal or external).
- If the Settlement Account has **insufficient funds**, the transfer is rejected, and the Corporate Client is notified.


## Developer Notes

- **Validation**: Every transaction is subject to balance checks and authorization controls.
- **Routing**: All flows must follow the hierarchy — Sub ↔ Parent ↔ Settlement.
- **Reversals**: Unauthorized inbound transactions (e.g., incorrect source IBAN) will be flagged and held pending manual review.
- **Audit Trails**: All transfers are fully logged with timestamps, transaction codes, and status updates for reconciliation.
- **Notifications**: Clients receive structured error responses when transactions are rejected (e.g., insufficient funds, invalid IBAN).