Posted April 11, 2000
LOS ANGELES, April 11 -- The U.S. Department of Housing and Urban Development and Paychex, Inc. (Nasdaq: PAYX), a national provider of payroll processing, human resources and benefits outsourcing for small- and medium-sized businesses, will each receive the 2000 George Mitchell Payment Systems Excellence Award today from NACHA -- The Electronic Payments Association.
HUD's Single Family Insurance Operations Division is being recognized for electronically collecting 100 percent of payments and payment-related data from mortgage originators applying for mortgage loan guarantees under the FHA loan guaranty program. Paychex is receiving the award for its success in providing Direct Deposit and other electronic payment services to small businesses.
In 1985, HUD became one of the first federal agencies to electronically collect payments using the Automated Clearing House (ACH) Network. By 1999, 100 percent of the mortgage loan guaranty payments were made using ACH, and HUD electronically collected over 195,000 payments worth more than $4 billion from more than 4,000 mortgage lenders. To support the use of electronic payments by the private sector, HUD distributed -- at no charge -- a PC-based payment origination and security control package to every mortgage loan originator.
"Electronic payments reduce the administrative burden on an organization as well as its trading partners," said Charles B. Bretz, Senior Vice President of Compass Bank and Chairman of the NACHA Marketing Committee. "We recognize HUD for its success in re-engineering its mortgage loan guaranty payment process and its commitment to using ACH payments."
"On behalf of the U.S. Department of Housing and Urban Development and Secretary Andrew Cuomo, I would like to thank NACHA for honoring the Department with the George Mitchell Payment Systems Excellence Award," said Victoria L. Bateman, Deputy Chief Financial Officer of HUD. "We sincerely, appreciate your recognition of the Department's efforts to utilize ACH payments to better serve our customers."
"We, at Treasury, are pleased to have been a partner in this endeavor with Housing and Urban Development. The partnership Treasury and HUD formed for converting its collections process to electronic methods has been a great success and is only one of the many improvements we've made in electronic payments systems," said Paul Gist, Director, Asset Management Directorate, Financial Management Service, Department of the Treasury.
Paychex (Nasdaq: PAYX) originates more than 48 million Direct Deposits annually, and its Direct Deposit growth has averaged more than 25 percent per year over the last 5 years. Paychex began offering Direct Deposit to its payroll clients in the early 1980s. In the early 1990s Paychex engineered a new payment process that achieved economies of scale for small businesses and reduced administrative work for financial institutions.
"Direct Deposit saves businesses more than one dollar, on average, for each payment converted from a check," said Bretz. "NACHA recognizes Paychex for its success in helping small businesses lower their costs and improve their productivity by using Direct Deposit and other ACH payment services."
Paychex provides a number of electronic payment services to small- and medium-sized businesses in addition to Direct Deposit. Paychex provides Electronic Federal Tax Payment System (EFTPS) participation for its clients, and has been recognized by the Internal Revenue Service for the participation excellence in the program. In 1998, Paychex introduced a payroll ATM/debit card, which can be used by employees who do not have conventional checking accounts.
"It's an honor to have been selected as the recipient of the George Mitchell Payment System Excellence Award," said Tom Golisano, Chief Executive Officer, Paychex, Inc. "Winning the award has been a team effort. Our more than 6,000 Paychex employees nationwide are proud to be recognized by NACHA."
"For small businesses, e-commerce is key to economic growth," added Golisano. "By making electronic funds transfer more affordable and more accessible, small businesses can leverage the power of the Automated Clearing House Network. Payroll processing is an excellent example of e-commerce at work. From utilizing Direct Deposit to pay your employees to utilizing the Electronic Federal Tax Payment System to pay your taxes, small businesses benefit from the electronic movement of money each business day."
Each year NACHA presents the George Mitchell Payment Systems Excellence Award in recognition of individuals and organizations that have improved the nation's payments system. The award is named in honor of the late George Mitchell, former Vice-Chairman of the Federal Reserve Board of Governors. NACHA is presenting this year's award today to HUD and Paychex at its PAYMENTS 2000 conference in Los Angeles, California.
About NACHA -- The Electronic Payments Association
NACHA represents more than 12,000 financial institutions through its 33 regional payments associations, and 600 organizations through its seven industry councils and corporate Affiliate Membership program. NACHA facilitates the development of operating rules and standards for the Automated Clearing House (ACH) Network and for electronic payments in the areas of Internet commerce, electronic bill payment and presentment (EBPP), financial electronic data interchange (EDI), international payments, electronic checks, electronic benefits transfer (EBT) and student lending. Visit NACHA on the Internet at http://www.nacha.org.