More ACH Changes Coming September 2017

The business world continues to evolve and banking is no different. There are two new rule changes being implemented in September this year. Beginning September 15, 2017, Same Day ACH will be available for debit entries, enabling the same-day processing of virtually any ACH payment.

The Rule enables the option for same-day ACH payments through additional ACH Network functionality, without affecting previously available ACH schedules and capabilities:

Originating financial institutions (ODFIs) are able to submit files of same-day ACH payments through two additional clearing windows provided by the ACH Operators. The actual ACH Operator schedules are not determined by the NACHA Operating Rules.

  • A morning submission deadline at 10:30 AM ET, with settlement occurring at 1:00 PM.
  • An afternoon submission deadline at 2:45 PM ET, with settlement occurring at 5:00 PM.

Virtually all types of ACH payments, including both credits and debits, are eligible for same-day processing. Only international transactions (IATs) and high-value transactions above $25,000 are not eligible. Eligible transactions account for approximately 99 percent of current ACH Network volume.

Another function of the same-day ACH rollout is that all RDFIs are required to receive same-day ACH payments, thereby giving ODFIs and Originators the certainty of being able to send same-day ACH payments.

The second rule to go into effect this September is that, effective September 29th, ODFIs are required to identify and register their Third-Party Sender customers. The hope is that the rule will promote consistent customer due diligence among all ODFIs, and serve as a tool to support NACHA’s continuing efforts to maintain ACH Network quality.

Initial Registration

For ODFIs with no Third-Party Sender customers a statement to that effect is sufficient. However, for ODFIs with Third-Party Sender customers, the Rule requires them to provide basic registration information for each Third-Party Sender. Fortunately the ODFI should already have that information.

Information needed:

  • ODFI’s name and contact information
  • Name and principal business location of the Third-Party Sender
  • Routing number for the ODFI that was used in the Originating DFI Identification field for Third-Party Sender ACH transactions
  • Company Identification(s) of the Third-Party Sender.

The registration requirement will apply to Third-Party Senders that are the ODFI’s direct customers, as well as those other Third-Party Senders that are direct customers of the first Third-Party Sender. The Rule obligates Third-Party Senders to provide, upon request, any registration information needed.

If you have any questions on the new ACH rules and how this new, rapid environment will affect your bank’s risk profile call ITPAC today.