qmk_firmware/docs/feature_encoders.md

Encoders

Basic encoders are supported by adding this to your rules.mk:

ENCODER_ENABLE = yes

and this to your config.h:

#define ENCODERS_PAD_A { B12 }
#define ENCODERS_PAD_B { B13 }

Each PAD_A/B variable defines an array so multiple encoders can be defined, e.g.:

#define ENCODERS_PAD_A { encoder1a, encoder2a }
#define ENCODERS_PAD_B { encoder1b, encoder2b }

If your encoder's clockwise directions are incorrect, you can swap the A & B pad definitions.

Additionally, the resolution can be specified in the same file (the default & suggested is 4):

#define ENCODER_RESOLUTION 4

Split Keyboards

If you are using different pinouts for the encoders on each half of a split keyboard, you can define the pinout for the right half like this:

#define ENCODERS_PAD_A_RIGHT { encoder1a, encoder2a }
#define ENCODERS_PAD_B_RIGHT { encoder1b, encoder2b }

Callbacks

The callback functions can be inserted into your <keyboard>.c:

void encoder_update_kb(uint8_t index, bool clockwise) {
    encoder_update_user(index, clockwise);
}

or keymap.c:

void encoder_update_user(uint8_t index, bool clockwise) {
  if (index == 0) { /* First encoder */
    if (clockwise) {
      tap_code(KC_PGDN);
    } else {
      tap_code(KC_PGUP);
    }
  } else if (index == 1) { /* Second encoder */  
    if (clockwise) {
      tap_code(KC_UP);
    } else {
      tap_code(KC_DOWN);
    }
  }
}

Hardware

The A an B lines of the encoders should be wired directly to the MCU, and the C/common lines should be wired to ground.

Encoder matrix

You can also wire the C/common line through a diode (arrow towards the row) to each of the rows (or reading pin) in your matrix, and use as many encoders as you have rows (multiplied by the number of A/B lines you have hooked up). To do this, you can add this line to your config.h with all of the pins you use:

#define ENCODERS_PAD_C { encoder1c, encoder2c }