Thursday, October 19, 2017

Same Day ACH Credits – Phase One

Posted by OnCourse Staff October 24, 2016 2:07pm

Photo Credit: Daniil Peshkov

By Ann Sookhoo, Senior Auditor

In today’s environment, we want everything faster, especially when it comes to our finances. National Automated Clearing House Association (“NACHA”) has adopted a new rule that will enable same-day processing for ACH credits received by the Receiving Depository Financial Institution (“RDFI”). This is phase one of three where virtually all ACH payments, including credits and debits, will be eligible for same-day processing. Phase one of the new rule became effective September 23, 2016, which allows funds to be available at the end of the RDFI’s processing day for same-day credit entries. Currently, most ACH payments are settled next business day. Any type of account that is able to receive ACH entries is eligible to receive same-day ACH entries. The exception to this rule is international transactions (“IAT”) and high-value transactions above $25,000, which will not be eligible. All RDFIs are required to receive same-day ACH payments, thereby giving Originating Depository Financial Institutions (“ODFI”) and Originators the certainty of being able to send same-day ACH payments to accounts at all RDFIs. RDFIs will be mandated to make funds available from same-day ACH credits (such as payroll Direct Deposits) to their depositors by 5:00 p.m. at the RDFI’s local time.

Same-day ACH also allows same-day processing of returns; however, RDFIs are not required to process returns on the same day an entry is received, regardless of whether the entry is a same-day entry. Offering same-day ACH products and services is optional for ODFIs. For those ODFIs that choose to offer same-day products and services, they should consider how they will be impacted by file submissions and delivery schedules to the RDFI for same-day entries.

Banks should have an action plan for the implementation across the three phases, including system testing to ensure that customer accounts are credited by the end of the processing day, and updating policies, procedures, and risk assessments.

With all the benefits that same-day ACH has to offer to consumers, financial institutions that use the ACH Network, in a 24/7, Internet-based environment, now have an innovative way to meet those expectations. Same-day will offer faster access to consumers to reach funds within their bank accounts at a faster pace. 

Phase 2 of same-day ACH will be launched on September 15, 2017. Faster processing and settlement of debit transactions will be offered with this phase. Phase 2 will support additional use cases, such as consumer bill payment for utility, insurance, telecom, mortgage, loan and credit card payments. 

For further guidance on same-day ACH payments, visit www.nacha.org.

 

Comments

Add a comment

  • Required fields are marked with *.

If you have trouble reading the code, click on the code itself to generate a new random code.



 Image

OnCourse Staff

The OnCourse writing staff work to keep you informed about the most pertinent financial industry news of the moment



OnCourse Staff's Posts Subscribe to RSS Feed



Training – An Investment and Risk Management Tool
Are You Gambling with Your BSA Program?
Same Day ACH Credits – Phase One
Is the IRS Status of your Defined Benefit plan in Jeopardy?
Is your Institution Monitoring Working Capital Lines of Credit?
Financial Reporting and Regulatory Update on the Horizon
Planning in a Consolidating Banking Industry
To opt-out or not to opt-out, that is the question – A reminder on March 31, 2015 Call Report, Schedule RC-R, item 3.a
Cybercriminals Broaden their Attacks in Social Networks
The Importance of Segregating a Bank’s Credit Function from its Lending Function
Requesting Current Financial Information
Countdown to Windows XP End of Life and Support: Are you still at Risk?
314(b) Distinct Advantages for Financial Institutions
Where is the Document?
Do You Know The Security Features of the New $100 Bill?
Segregation of Duties for Wire Transfer Processing
Community Banks Slowly Warm Up to Private Student Loans
Has your Bank updated the Adverse Action Notice?
How Does Your Bank Handle Customer Requested Maintenance Changes?
OCC Releases Booklet on "Common Sense" Community Banking
New SAR Filing Updates
The Importance of BSA Training
FFIEC Proposed Risk Management Guidance on Social Media: Beware and Prepare
Pandemic Preparedness: Are you testing your Pandemic Plan?
FFIEC issues revised “Supervision of Technology Service Providers” booklet
Is Your Institution's Marketing UDAAP Compliant?
Electronic Work Papers - Why P&G Made the Switch
Community Lenders Seize Market Share From Big Banks by Using Advanced Online Lending Technology
New FinCEN Guidance for CTR Aggregation for Businesses with Common Ownership (FIN – 2012 –G001)
Curry: Operational Risk Now OCC’s Top Concern
JOBS Act Client Alert - Rules 506 of Regulation D
Wall Street Receives Volcker Rule Clarity
De-stressing with stress testing
Banks Participate in Information Sharing to Battle Online Theft
IT security: Is your program still effective?
Mobile banking: How do we get there?
UBS further struggles with $2 Billion loss by Rogue Trader
Capital One Becomes Dodd-Frank Test as Nation’s Fifth Largest Bank
Community Banks to receive US Funding for Small Businesses
FDIC fields questions about overdraft guidance
Negligent Hiring – A mistake can cost more than just money!
From Embezzlement to Imprisonment: Former Citigroup employee faces charges with $19.2 million in bank fraud
Finding the Right Hire
Model behavior: Is your ALM model capturing your bank’s risks?
ALLL best practices: Pay attention to qualitative factors
Abandoned Property Law, and its new New York State of Mind
FDIC releases Provisions on Dodd-Frank to help Community Banks
Social Media in the Employment Arena – It Gets Funky!
Banks and Businesses get "swiped" over Fees
A little bit of this, and a little bit of that: Fed Unveils list of Banks Helped during Financial Crisis of 2008
To Test or Not to Test; That is the Question
2011 Failed Bank List Hits 25
Committee on Financial Services to Hold Hearing on the Effects of Dodd-Frank on Small Biz and Banks Today
2011 Failed Bank List up to 18
The Test Drive: Leasing or Buying a HR IT Platform
Double Digits: Bank Closings up to 11 in 2011
FCIC Releases Report on the Causes of the Financial Crisis
Another One Bites the Dust: Regulators Close 4 Banks
On Notice: FDIC Issues Rule for Temp Unlimited Deposit Insurance
2011 Failed Bank List Up to 3
Stick 'Em Up!
Time for a Tune-Up: The Necessity of a HR Audit
Visa Instituting Two-Tiered Debit Card Interchange Structure
The First Failed Banks of 2011
The Law on Your Side: Understanding HR Regulations in 2011
No Respite from RESPA