Increasing the Same Day ACH dollar limit to $1 million per payment posed no greater fraud risk than the prior $100,000 threshold, a new survey by Nacha’s Risk Management Advisory Group (RMAG) found.
RMAG reviewed the proposal before it took effect in March, weighing potential risks and benefits before advising Nacha’s Rules and Operations Committee. The group concluded that the rise to $1 million was unlikely to increase incidences of fraud involving Same Day ACH, and that the higher dollar value opened new use cases for Same Day ACH that would benefit the ACH Network by providing additional utility to Originators and Receivers.
So far, that appears to be exactly the case.
Recent data shows that the use of Same Day ACH is growing rapidly. Over 600 million payments were sent in 2021 using Same Day ACH, an increase of 74% over 2020. From February 2022 to April 2022, the months before and after the per-payment limit went from $100,000 to $1 million, the dollar volume of Same Day ACH more than doubled, from $81 billion to $177 billion.
Meanwhile, ACH return rates have not changed appreciably around any of the Same Day ACH enhancements that have taken effect.
In addition to monitoring data, Nacha also reaches out to member financial institutions on RMAG and the Rules and Operations Committee to survey their experiences with Same Day ACH. Nacha conducts “post-implementation” surveys after every phase and every enhancement to Same Day ACH. The surveys usually take place 2 to 4 months following the implementation to give Financial Institutions the opportunity to assess what they are seeing—or not seeing—in their internal reporting.
In each survey Nacha asks the following about fraud related to that phase or enhancement:
- Have you seen an increase in Same Day ACH fraud that is directly attributable to the phase or enhancement that has just been implemented?
- If yes, is the increase measurable or anecdotal?
Nacha has never received a yes response to the fraud questions on any of the surveys. Nacha generally receives responses from enough financial institutions that those institutions originate between 60% to 70% of all commercially originated ACH Network volume.
The latest survey asks, “As an ODFI, do you allow clients to originate transactions up to the new $1 million dollar limit?” All financial institutions surveyed that originate Same Day ACH transactions allow clients to originate up to the new limit, with 90% seeing clients consistently originating above the previous limit of $100,000.
We also ask RDFIs about Same Day ACH transactions. Over 80% of the respondents surveyed are receiving Same Day ACH transactions over the prior limit of $100,000 on a common or daily basis. No RDFI has seen an increase fraudulent activity that is attributable to the increase in the Same Day ACH dollar limit.
Incremental enhancements such as the increased dollar limit and multiple settlement times throughout the business day make Same Day ACH one of the most innovative and versatile methods of payment for ACH Network participants and their customers.