2020 Brings Four Nacha Operating Rules Changes. Are You Ready?


Michael W. Kahn

Michael W. Kahn


New year, new Nacha Operating Rules. 

With four imminent Rules changes, now’s the time to get ready, which is why Nacha hosted the Dec. 3 webinar “2020 Nacha Operating Rules: Preparing for the New Rules.”

The first change arrives March 20, 2020, when the dollar limit for each Same Day ACH transaction quadruples to $100,000. Amy K. Morris, Nacha Senior Director, ACH Network Rules, called it an “across the board” increase covering debits and credits, and applying to all eligible SEC codes. 

Preparations for ACH Network participants include examining risk procedures and educating receivers. 

Just 11 days later, the first phase of implementation begins for a Rules change on Differentiating Unauthorized Return Reasons. 

ODFIs and Originators will have clearer information for when a customer claims there was an error with an authorized payment, as opposed to when a customer says the payment was unauthorized.

Instead of using the popular R10 return reason code, the R11 code will become the code enabling a return that conveys the new meaning of “error” rather than “no authorization.”

Phase one of implementation is April 1, 2020, with phase two arriving exactly a year later.

Another imminent Rules change will also be implemented in two phases, the first of which is effective June 30, 2020. 

Supplementing Data Security Requirements focuses on three large groups: Originators that are not Financial Institutions, Third-Party Senders, and Third-Party Service Providers. They’ll be required to render deposit account information unreadable when electronically storing it. 

Phase one covers companies with 6 million or more annual ACH transactions. Phase two—effective June 30, 2021—will be for firms with 2 million or more ACH transactions a year. 

Finally, the webinar covered what Morris called “breaking news”—a new Rule approved Nov. 19 creating the ACH Contact Registry. 

“Financial institutions can sometimes find it a challenge to figure out how to contact a counterpart at another financial institution in a very quick and concise manner,” said Morris. 

It’s often situations where “time is of the essence,” she said, including fraud, system outages, and erroneous transactions and reversals. 

The Registry will provide “a comprehensive place where you can find, for each of those types of scenarios, somebody that can help you” at another FI, said Morris. 

Starting July 1, 2020, all FIs using the ACH Network will be required to register contact information including people or departments responsible for ACH operations and fraud/risk management. There are also requirements for keeping the information updated. 

The complete 90-minute “2020 Nacha Operating Rules: Preparing for the New Rules” webinar has in-depth details about all four upcoming Rules changes. Click here to visit Nacha.org and purchase the webinar recording. The webinar is worth 1.8 continuing education credits for AAPs and APRPs.