Same Day ACH: Moving Payments Faster (Phase 1)

NACHA has adopted a Rule to provide a new, ubiquitous capability for moving ACH payments faster. The Rule will enable the same-day processing of virtually any ACH payment. 
 

Currently, most ACH payments are settled on the next business day. There are many uses of ACH payments, however, for which businesses and consumers could benefit from same-day processing. This NACHA rule change will enable ACH Originators that desire same-day processing the option to send same-day ACH transactions to accounts at any receiving financial institution (RDFI). The Rule includes a “Same Day Fee” on each Same Day ACH transaction so that RDFIs would recover, on average, their costs for enabling and supporting Same Day ACH.
 
The Rule will enable the option for same-day ACH payments through new ACH Network functionality, without affecting existing ACH schedules and capabilities:
 
Originating financial institutions (ODFIs) will be able to submit files of same-day ACH payments through two new clearing windows provided by the ACH Operators (Note: 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, will be eligible for same-day processing. Only international transactions (IATs) and high-value transactions above $25,000 will not be eligible. Eligible transactions account for approximately 99 percent of current ACH Network volume.

All RDFIs will be required to receive same-day ACH payments, thereby giving ODFIs 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 PM at the RDFI’s local time.

To allow financial institutions and businesses to acclimate to a faster processing environment, as well as to ease the implementation effort, these new capabilities will become effective over three phases beginning in September 2016.
 

Learn more about Same Day ACH with our Resource Center.

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Detailed Information

The Rule is based on a solid foundation of economic research on the use cases for Same Day ACH.

All consumers, businesses, government entities and financial institutions that use the ACH Network to move money between bank accounts will benefit from the option to move ACH payments faster.

NACHA projects that ACH Originators would generate approximately 1.4 billion same-day ACH payments annually as of ten years after full implementation and rollout, primarily for transactions that can be initiated before 2:45 PM ET on business days (not on weekends or holidays), and that do not require real-time functionality.

Using an expert, third-party economist, NACHA assessed 10 primary use cases for Same Day ACH. Significant use cases for Same Day ACH include: 

  1. Same-day payrolls, supporting business’ needs to pay hourly workers, and providing flexibility for late and emergency payrolls and missed deadlines; and enabling employees to have faster access to their pay in these cases;
  2. Business to-Business payments, enabling faster settlement of invoice payments between trading partners, and including remittance information with the payments;
  3. Expedited bill payments using both ACH credits and debits, enabling consumers to make on-time bill payments on due dates, and providing faster crediting for late payments; and,
  4. Account-to-account transfers, providing faster crediting for consumers who move money among various accounts they own.
The following changes to the NACHA Operating Rules became effective on September 23, 2016.

SECTION 8.99 “Same Day Entry”

An Entry, other than a debit Entry, in which the Effective Entry Date is the same Banking Day as the date on which the Entry is Transmitted by the ODFI to its ACH Operator, and that is Transmitted by the ACH Operator’s deadline for same-day processing and settlement. A Same Day Entry must be for an amount of $25,000 or less. An IAT or ENR Entry cannot be a Same Day Entry. For purposes of fulfilling its obligations under these Rules, an RDFI may rely on the Settlement Date of an Entry, regardless of the Effective Entry Date. An Entry with a stale or invalid Effective Entry Date will also be a Same Day Entry if it is Transmitted by the ODFI to its ACH Operator by the ACH Operator’s deadline for same-day processing and settlement, and is otherwise eligible for same-day processing and settlement.

SUBSECTION  2.5.7 General Rule for ENR Entries (Automated Enrollment Entry)

An ENR Entry is a Non-Monetary Entry that enrolls a Person with an agency of the United States Government that will enable Entries to such Person’s account at a Participating DFI.  An ENR Entry may be originated by a Participating DFI at the request of an account holder at the Participating DFI to an agency of the United States Government that has agreed to receive the ENR Entry. An ENR Entry cannot be a Same Day Entry.
 
SUBSECTION 2.5.8.1 General Rule for IAT Entries
 
An IAT Entry is an Inbound or Outbound debit or credit Entry that is part of a payment transaction involving a Financial Agency’s office that is not located in the territorial jurisdiction of the United States. An IAT Entry cannot be a Same Day Entry.

SUBSECTION 3.1.9 RDFI May Rely on Settlement Date (new subsection)
 
For purposes of fulfilling its obligations under these Rules, an RDFI may rely on the Settlement Date of an Entry, regardless of the Effective Entry Date.
 
SUBSECTION 3.3.1.1 General Rule for Availability of Credits
 
For a credit Entry that is not a Same Day Entry, an RDFI must make the amount of the credit Entry received from its ACH Operator available to the Receiver for withdrawal no later than the end of the Settlement Date of the Entry, subject to its right to return the Entry under these Rules.
 
For a credit Same Day Entry, an RDFI must make the amount of the credit Entry available in the Receiver’s account no later than the completion of the RDFI’s processing for that Settlement Date, subject to its right to return the Entry under these Rules. An RDFI is not required to make such funds available for withdrawal on the Settlement Date.
 
An RDFI that reasonably suspects that a credit Entry is unauthorized is exempt from these requirements, subject to applicable Legal Requirements. An RDFI invoking such an exemption must promptly notify the ODFI.

SECTION 8.12 “Automated Enrollment Entry” or “ENR Entry” or “ENR”

A Non-Monetary Entry initiated by a Participating DFI to an agency of the Federal Government of the United States on behalf, and at the request, of an account holder at the Participating DFI to enroll in a service that will enable Entries to such Person’s account at the Participating DFI. An Automated Enrollment Entry cannot be a Same Day Entry.
 
SECTION 8.54 “International ACH Transaction” or “IAT Entry” or “IAT”

An Entry that is part of a payment transaction involving a Financial Agency’s office that is not located in the territorial jurisdiction of the United States. An office of a Financial Agency is involved in the payment transaction if it (a) holds an account that is credited or debited as part of the payment transaction, (b) receives payment directly from a Person or makes payment directly to a Person as part of the payment transaction, or (c) serves as an intermediary in the settlement of any part of the payment transaction. An International ACH Transaction cannot be a Same Day Entry.
 

SUBPART 3.2.2 Glossary of Data Elements
 
Company Descriptive Date: 6 Positions – Company/Batch Header Record – Optional
 
Same Day Entries:  At its discretion, an ODFI may require an Originator to use this field to further demonstrate intent for same-day processing and settlement. ODFIs that choose to do so should use the convention “SDHHMM”, where the “SD” in positions 64-65 denotes the intent for same-day settlement, and the hours and minutes in positions 66-69 denote the desired settlement time using a 24-hour clock. When electing to use this convention, the ODFI would validate that the field contains either “SD1300” for settlement desired at 1:00 p.m. ET, or “SD1700” for settlement desired at 5:00 p.m. ET, in accordance with the settlement times offered by the ACH Operators.  ACH Operators and RDFIs are not required to take any action with respect to the presence or absence of these optional same-day indicators.
 
Effective Entry Date:  6 Positions – Company/Batch Header Record – Required (all batches)
 
The Effective Entry Date is the Banking Day specified by the Originator on which it intends a batch of Entries to be settled.
 
For credit Entries, the Effective Entry Date must be either the same Banking Day as the Banking Day of processing by the Originating ACH Operator (the processing date) for Same Day Entries, or one or two Banking Days following the Originating ACH Operator’s processing date for other Entries. 
 
For debit Entries, the Effective Entry Date must one Banking Day following the processing date.
 
A batch of Entries containing an Effective Entry Date beyond the designated number of days allowed is Rejected by the ACH Operator and returned to the ODFI. 
 
A batch of Entries containing an Effective Entry Date that is stale (i.e., is a Banking Day that is in the past, or is the current Banking Day but is not submitted timely to an ACH Operator for same-day processing and settlement) is settled at the next available settlement opportunity.
 
A batch of Entries containing invalid Effective Entry Date information (for example, if the field is blank or zero, partially blank or partially non-numeric, contains an incomplete date, contains day numbers higher than 31, or contains month numbers higher than 12) is settled at the next available settlement opportunity. The Originating ACH Operator inserts the Banking Day of processing or the next Banking Day as the Effective Entry Date, whichever corresponds to the next available settlement opportunity.
 
ENR: For Automated Enrollment Entries, this field must be space filled. Automated Enrollment Entries cannot be Same Day Entries.
 
Return Entries and Notifications of Change: The ACH Operator does not edit this field.
 
The scheduled Settlement Date is inserted by the Receiving ACH Operator. See the definition of “Settlement Date” in this Appendix Three.

Settlement Date: 3 Positions – Company/Batch Header Record – Inserted by Receiving ACH Operator (all batches)

The Settlement Date (a 3-digit Julian date) for a batch of Entries is inserted by the Receiving ACH Operator. This is the date on which the Participating DFI or its correspondent is scheduled to be debited or credited by the Federal Reserve.

The Settlement Date inserted by the Receiving ACH Operator is the same as the Effective Entry Date, except as noted below.

In the following situations, the Receiving ACH Operator will insert the Banking Day following the Banking Day of processing as the Settlement Date (i.e., the next Banking Day):

  1. The Effective Entry Date and the Originating ACH Operator’s processing date are the same, but the Entry is received by the Receiving ACH Operator after its deadline for same-day settlement. 

  2. The Effective Entry Date and the Originating ACH Operator’s processing date are the same, but the Entry is for an amount greater than $25,000. 

  3. The Effective Entry Date and the Originating ACH Operator’s processing date are the same, but the Entry bears the IAT Standard Entry Class Code. 

  4. The Entry bears the ENR Standard Entry Class Code. 

  5. A debit Entry contains an Effective Entry Date that is the Banking Day of processing. 

Entries with invalid or stale Effective Entry Dates will be settled at the next available settlement opportunity.

Return Entries, dishonored Return Entries, and contested dishonored Return Entries are settled by the ACH Operator no earlier than the Effective Entry Date contained within the original Entry, as it appears in the Return Entry Company/Batch Header Record. The return of an Entry that contains an invalid or stale Effective Entry Date will be settled by the ACH Operator at the next available settlement opportunity (i.e., the Banking Day of processing or the next Banking Day).
 
Notifications of Change will be settled at the next available settlement opportunity, (i.e., the Banking Day of processing or the next Banking Day).

Appendix Eight, Part 8.3 Audit Requirements for RDFIs and Third-Party Service Providers
 
    d.    Verify that, subject to the RDFI’s right of return, the amount of each credit Entry received from its ACH Operator is made available to the Receiver as required by Article Three, Subsection 3.3.1 (Availability of Credit Entries to Receivers). Verify that debit entries are not posted prior to the Settlement Date, even if the Effective Date of the Entry is different from the Settlement Date of the Entry.  (Article Three, Subsections 3.3.1)

SUBPART 10.4.6.2 Responsibilities of Enforcement Panel
 
The ACH Rules Enforcement Panel, in accordance with these rules, is the final authority regarding each of these issues:
 

  • the imposition of any fines or penalties recommended by the National Association; 

  • instances in which the National Association believes the time frames and Resolution Dates asserted by the respondent Participating DFI as necessary to resolve the problem causing a rules violation are excessive; 

  • instances in which the National Association believes an ODFI, Originator or, Third-Party Sender has originated Entries without proper authorization in accordance with these Rules; 

  • instances in which the National Association believes an ODFI, Originator, or Third-Party Sender has attempted to evade the limitations on Reinitiation; 

  • instances in which the National Association recommends, after the inquiry process, that an ODFI be required to reduce an Originator’s or Third-Party Sender’s applicable return rate below the Administrative Return Rate Level and/or the Overall Return Rate Level; 

  • instances in which the National Association believes an ODFI, Originator, or Third-Party Sender has attempted to evade the $25,000 per-Entry limitation on Same Day Entries. 

SECTION 1.12 Same Day Entry Fee (new section)
 

An ODFI agrees to pay a Same Day Entry fee to the respective RDFI for each Same Day Entry originated by or through the ODFI. The staff of the National Association will determine the amount of the Same Day Entry fee in accordance with the procedures set forth in Appendix Eleven (Determination and Review of Same Day Entry Fee). The National Association will arrange for a system for the collection and distribution of Same Day Entry fees.

APPENDIX ELEVEN – DETERMINATION AND REVIEW OF SAME DAY ENTRY FEE
(new section) (Note: If the effective dates of the Rule are delayed as discussed in the ballot material, all dates shown in this Appendix would be modified accordingly.)
 
PART 11.1 Determination of Same Day Entry Fee (new part)

The staff of the National Association will determine in accordance with this Part 11.1, and revise in accordance with Part 11.2 (Revision of Same Day Entry Fee), the amount of the Same Day Entry fee. In determining the amount of the Same Day Entry fee, the staff of the National Association will apply the following principles:

  1. The Same Day Entry fee will be based on a cost study and financial analysis performed by a qualified economist. 

  2. For the Same Day ACH Initial Period, the Same Day Entry fee will provide for the full recovery of the projected average RDFI investment costs and operational costs,     plus a commercially reasonable rate of return, as determined by the first such cost study and financial analysis.  

  3. For a Same Day ACH Renewal Period, the Same Day Entry fee will provide for the full recovery of the projected average RDFI operational costs, plus a commercially reasonable rate of return, as determined by the most recent such cost study and financial analysis. 

  4. The Same Day Entry fee will take into consideration the projections of the aggregate volume of Same Day Entries over the Same Day ACH Initial Period or the Same Day ACH Renewal Period, as applicable, as determined by the cost study and financial analysis.

 PART 11.2 Revision of Same Day Entry Fee (new part)
 

  1. Five Year Volume Review. The staff of the National Association will review the cumulative volume of Same Day Entries for the five-year period commencing on the Same Day ACH Phase Three Effective Date. If the actual cumulative volume exceeds the projected volume used to calculate the Same Day Entry fee by greater than twenty-five percent (25%), the staff of the National Association will publish a reduced Same Day Entry fee based on a table prepared by the qualified economist that will designate the appropriate Same Day Entry fee derived from the actual volume. The table will set forth reduced Same Day Entry fees at volume increments of 5% beginning at twenty-five percent (25%) in excess of the projected volume used to calculate the Same Day Entry Fee. If the cumulative volume of Same Day Entries for this period does not meet or exceed the 25% threshold, the Same Day Entry fee will remain unchanged. In no case will the Same Day Entry fee be increased as a result of this review. NACHA will publish notice of the reduced or unchanged Same Day Entry fee promptly following the completion of this review, and any such reduced Same Day Entry fee will become effective six months following publication.   

  2. Eight Year Volume Review. The staff of the National Association will review the cumulative volume of Same Day Entries for the eight-year period commencing on the Same Day ACH Phase Three Effective Date. If the actual cumulative volume exceeds the projected volume used to calculate the Same Day Entry fee by greater than twenty-five percent (25%), the staff of the National Association will publish a reduced Same Day Entry fee based on a table prepared by the qualified economist that will designate the appropriate Same Day Entry fee derived from the actual volume. The table will set forth reduced Same Day Entry fees at volume increments of 5% beginning at twenty-five percent (25%) in excess of the projected volume used to calculate the Same Day Entry fee. If the cumulative volume of Same Day Entries for this period does not meet or exceed the 25% threshold, the Same Day Entry fee will remain unchanged from the amount in effect at that time. In no case will the Same Day Entry fee be increased as a result of this review. NACHA will publish notice of the reduced or unchanged Same Day Entry fee promptly following the completion of this review, and any such reduced Same Day Entry fee will become effective six months following publication. 

  3. Ten Year Economic Review. Ten years after the Same Day ACH Phase Three Effective Date or a subsequent Same Day ACH Renewal Period, the staff of the National Association will engage a qualified economist to perform a cost study and financial analysis based on the principles set forth at Part 11.1 to determine: 1) actual average costs incurred by RDFIs during such period; 2) actual volumes of Same Day Entries; 3) the extent to which average RDFI costs, including a commercially reasonable rate of return, were satisfied through the Same Day Entry fee; 4) projected changes in the foregoing over a ten-year period, including each element of RDFI costs; and 5) a recommended Same Day Entry fee derived from such analysis, which in no case shall be higher than the Same Day Entry fee then in effect. Average RDFI implementation costs that have been compensated through the payment of Same Day ACH fees during the preceding period will be excluded from any re-calculation of the Same Day Entry fee. NACHA will publish the revised Same Day Entry fee (if any) no later than eleven years after the Same Day ACH Phase Three Effective Date, and such revised Same Day Entry fee will become effective six months following publication. The staff of the National Association will repeat this process promptly following the tenth anniversary of the effective date of any Same Day Entry fee, including an unchanged fee, published pursuant to this Part 11.2(C).

Part 11.3 Same Day ACH Initial Period (new part)
 
The period between the September 23, 2016 effective date of Part 11.1 and the September 21, 2029 effective date of the first revision (or notice of no change) of the Same Day Entry fee pursuant to Part 11.2(C).
 
Part 11.4 Same Day ACH Phase Three Effective Date (new part)
 
The March 16, 2018 effective date for the third phase of implementation of Same Day ACH.
 
Part 11.5 Same Day ACH Renewal Period (new part)
 
The period between the effective date of a revision (or notice of no change) of the Same Day Entry fee pursuant to Part 11.2(C), and the effective date of the next revision (or notice of no change) pursuant to Part 11.2(C).
 

 
Same Day ACH Impacts by Party
ODFI Impacts
 

Offering Same Day ACH products and services is optional for ODFIs.  For those ODFIs that choose to offer Same Day products and services, the following impacts should be considered:

  • Discuss new file submission and delivery schedules with ACH Operator

  • Review and revise internal processing schedules and procedures to accommodate new windows for Same Day Entries.

  • Review downstream applications and systems that may be impacted by Same Day Entries.

  • Communicate with Originators and Third-Parties on Same Day Entries

    • Determine customers and business models to offer Same Day 
    • Discuss proper use of the Effective Entry Date and impacts of improper Effective Entry Dates. Discuss alternatives if an Originator is not able to properly use Effective Entry Dates. If desired, discuss use of an optional indicator for Same Day entries
    • Discuss eligibility requirements for Same Day Entries
  • Develop procedures for holding entries that are received from an Originator in time for a same day window but that is not the Originator’s desire

  • Be aware that Phase 1 is restricted to credit entries and non-monetary entries only.

  • ODFIs will receive information from their ACH Operator regarding collection of the Same Day Entry fees. 

RDFI Impacts

Receipt of Same Day Entries is not optional for RDFIs.  RDFIs should consider the following potential impacts:

  • RDFIs should discuss new file delivery schedules with ACH Operator

  • RDFIs should review procedures and resources for processing files  in the new delivery windows

  • RDFIs should process entries based on the Settlement Date provided by the ACH Operator. RDFIs do not need to review Effective Entry Date or any other indicator to determine processing.

  • RDFIs do not need to determine same day eligibility for processing.

  • In the first phase, RDFIs will only receive credit entries as same day entries. Beginning in Phase 2, RDFIs should be prepared to also receive debit entries as same day entries.  

  • Determine whether to use the new same-day processing windows to send returns and NOCs. Returns will be allowed, but not required, to be processed on the same day. For a Same Day ACH entry, since settlement is one day sooner, the return deadline is also one day sooner.

  • Beginning in Phase 1, RDFIs should provide end of day funds availability for all same day credit entries received.  Phase 3 will require RDFIs to provide funds availability at 5:00 pm local time for same day credit entries. 

  • Review downstream applications and systems that may be impacted by Same Day Entries.

  • RDFIs will receive information from their ACH Operator regarding receipt of the Same Day Entry fees. 

Originators/Third-Parties

  • Talk to your FI to determine if Same Day is appropriate and cost effective

    • Discuss new file submission and exception resolution cut-off times
What are the major provisions of Same Day ACH?
The Rule will enable the option for same-day ACH payments through new ACH Network functionality, without affecting existing ACH schedules and capabilities:
 
Originating financial institutions (ODFIs) will be able to submit files of same-day ACH payments through two new clearing windows provided by the ACH Operators :
 
  • 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, will be eligible for same-day processing. Only international transactions (IATs) and high-value transactions above $25,000 will not be eligible. Eligible transactions account for approximately 99 percent of current ACH Network volume.

All RDFIs will be required to receive same-day ACH payments, thereby giving ODFIs 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 PM at the RDFI’s local time.

To allow financial institutions and businesses to acclimate to a faster processing environment, as well as to ease the implementation effort, these new capabilities will become effective over three phases beginning in September 2016.

What are the Effective Dates?
The rule will become effective in three phases:

  • Phase 1 will become effective on September 23, 2016 (credit entries with funds available at end of RDFI processing day);
  • Phase 2 will become effective on September 15, 2017 (credit and debit entries with funds available at end of RDFI processing day);
  • Phase 3 will become effective on March 16, 2018 (credit and debit entries with funds available at 5:00 pm RDFI local time). 
Spreading implementation across three phases will ease the industry’s implementation effort, and allow the industry to acclimate to a faster processing environment with same-day ACH credits prior to processing same-day ACH debits.

How will Same Day ACH transactions be identified?
Same Day ACH transactions will be identified and processed by the ACH Operator using that day’s date in the Effective Entry Date field of the batch of Same Day ACH transactions and meeting the ACH Operator processing deadline. If the entry contains a stale or invalid date in the Effective Entry Date field, the Operator will process the entry in the next available window, which could be same day or next day.
 
ODFIs at their discretion may require their Originators to further show intent for same-day settlement using an optional, yet standardized, same-day indicator in the Company Descriptive Date field. The Company Descriptive Date field (5 record, field 8) is an optional field with 6 positions available (positions 64-69). Currently, the Rules provide that the “Originator establishes this field as the date it would like to see displayed to the Receiver for descriptive purposes.” NACHA recommends that, as desired, the content of this field be formatted using the convention “SDHHMM”, where the “SD” in positions 64- 65 denotes the intent for same-day settlement, and the hours and minutes in positions 66-69 denote the desired settlement time using a 24-hour clock. When electing to use this convention, the ODFI should validate that the field contains either “SD1300” for settlement desired at 1:00 PM ET, or “SD1700” for settlement desired at 5:00 PM ET.

Why start with same-day credits?
Credits generally cause fewer exceptions and returns than debits, and so are viewed by many as a good way to gain initial experience processing same-day ACH transactions.
 
When will RDFIs have to make funds available?
Initially RDFIs will need to make funds available at the end of their processing day. By the Phase 3 implementation date, all RDFIs will be required to make available funds from same-day ACH credits no later than 5:00 PM at the RDFI’s local time. This is to ensure that the recipients of same-day ACH credits have access to funds in their accounts by the end of the business day. This functionality is important in supporting use cases such as payroll, in which it is critical that an employee be able to withdraw cash on payday. RDFIs may make funds available earlier at their discretion.

Why are there special funds availability requirements for certain RDFIs under Phase Three of Same Day ACH?
In Phase Three of Same Day ACH, most RDFIs will receive their last files that could contain Same Day credit Entries an hour or more before they are required to make funds available to their Receivers for withdrawal at 5:00 p.m. local time, giving them adequate time for internal processing and posting to Receivers’ accounts. However, for RDFIs located east of the continental U.S. and west of the International Date Line, time zone changes make it impossible for the ACH Operators to distribute files containing Same Day Entries in advance of the time in which those RDFIs must meet their 5:00 p.m. local time funds availability requirement. In other words, it is already 5:00 p.m. local time or later before the last files containing Same Day Entries are made available to those RDFIs. RDFIs in the Atlantic Time Zone will be required to make funds available to Receivers for withdrawal by 5:00 p.m. Eastern Time (that is, by 6:00 p.m. in Atlantic Time).​ ​RDFIs east of Atlantic Time and west of the International Date Line (includes Guam and the Northern Mariana Islands) will be required to make funds available to their Receivers for withdrawal no later than the opening of business on the banking day following the settlement date of the entry.​

Will the receipt of same day credits impact corporate receivers?
Corporate Receivers of same-day ACH credits will be required to credit a customer’s account for a same day payment as of the settlement date of the same day entry. The corporate has a reasonable amount of time to reflect that payment in the customer’s account.
 
Why are large dollar transactions (above $25,000) ineligible?
Faster velocity of payments is expected to introduce risks that must be managed and mitigated. A per- transaction dollar limit is one way to mitigate risk. Financial institutions and businesses will also have to adjust their end-of-day balance forecasting and funding, and the dollar limit is a way to limit the impact. Currently, more than 99% of ACH transactions are under $25,000, so the overall impact of the same-day limit is expected to be modest.
 
How will the $25,000 limit be enforced?
The ACH Operators will edit for the $25,000 limit for Same Day ACH transactions, and will assign next day settlement to any transactions above the limit.
 
Will Same Day ACH be available for all account types?
Any account that is able to receive ACH entries today could receive Same Day ACH entries.
 
What is the Same Day Entry Fee?
A Same Day Entry Fee of 5.2 cents will be paid from the ODFI to the RDFI for each Same Day ACH transaction. Collection and disbursement of Same Day Entry Fees for ODFIs and RDFIs will be handled by the ACH Operators through monthly billing. In billing for the Same Day Entry fees, the ACH Operators will round each financial institution’s monthly statement charge or credit to the nearest cent. For example, an ODFI that originates 13 same-day transactions in September 2016 would be billed $0.68 via its monthly ACH Operator billing statement (i.e., 13 same-day transactions * $0.052 = $0.676, which is rounded to $0.68).
 
Will non-monetary ACH transactions be eligible for Same Day processing?
For non-monetary transactions, there are no funds to settle. Generally, these transactions will benefit from same-day processing. Under this rule, most of these transactions will be eligible for same-day processing beginning with Phase 1 of implementation.

The eligible non-monetary transactions include:

  • Prenotifications for future credits (Prenotifications for future debits will become eligible for same-day processing in Phase 2)
  • Remittance information (using CCDs and CTXs)
  • Notifications of Change (NOCs) NOCs are transmitted from the RDFI to the ODFI and will not incur a Same Day Entry Fee

Automated Enrollment Entries (ENRs) will not be processed as same-day entries. ENRs do not use Effective Entry Dates, so there is no way to designate an ENR as a same-day transactions.

Why are IATs ineligible?
The receipt of an IAT triggers the burden of the OFAC screening requirements. Receiving IAT items late in the day could impose a significant burden on many financial institutions to complete the OFAC screening in a timely manner.​

How will TRC and TRX Entries be treated under the Same Day ACH rules?
Same Day ACH treats TRC and TRX the same as all other eligible SEC codes, where settlement will be based on the Effective Entry Date.​

How will returns be affected by Same Day ACH?
For ACH transactions that need to be returned, faster processing of the return is typically a “win-win” for all parties. ODFIs and Originators will learn about problems sooner and RDFIs will have exceptions processed and settled faster.
 
Same Day ACH will allow for the same-day processing of returns, regardless of whether the forward transaction is a same-day transaction or not. All returns are eligible to be sent and processed using the same-day processing schedules.  Returns that are settled on a same-day basis are not subject to the Same Day Entry Fee and are not subject to the eligibility limit on forward Same Day transactions (i.e., $25,000 per transaction; IAT).
 
An RDFI is not required to process returns on the same day an Entry is received, regardless of whether the Entry is a Same Day Entry.
 
A forward Same Day ACH entry that is returned by the ACH Operator (and does not reach the RDFI) will not be charged a Same Day Entry fee. 
 
How will reversals be affected by Same Day ACH?
Reversals are eligible for same-day processing using the same eligibility criteria as other forward transactions. A same-day reversal is limited to $25,000 per transaction, so any reversal to correct a forward entry over $25,000 (for example, to reverse an erroneous next-day credit of $100,000) would not be eligible to be sent as a Same Day ACH entry. Any reversal that is processed and settled same-day will be assessed the Same Day Entry Fee.
 
ODFIs/Originators must ensure that the Effective Entry Date of a reversing debit to correct an erroneous Credit Entry or a reversing file to correct an erroneous credit file is not earlier than the Effective Entry Date of the related credit(s). Since Phase 1 permits only same-day credits, a debit that reverses a credit Entry will not be eligible for same-day processing during Phase 1. Same-day debits become eligible in Phase 2, so at that time the debit to reverse a credit could be sent and settled the same-day. 

Will Same Day ACH transactions be able to carry remittance information?
CCD and CTX entries, as well as other entries that carry remittance, may be eligible to be sent as Same Day ACH. Requirements related to provision of remittance to Receivers will not change.
 
What is the difference between Same Day ACH and real-time payments?
Same Day ACH and real-time payments will offer complementary options for users, as they will have distinct functionality and thereby meet distinct needs of various use cases. Today’s ACH Network supports traditional ACH debit payments –bill payments, for example – as well as traditional credit payments like payroll. Approximately 60% of ACH transactions are debit payments. A real-time system would likely provide credit payments only; however, there is benefit to moving both credits and debits faster.
 
Will Federal government payments be eligible for Same Day processing?
The Federal government will not be participating in Phase One of Same Day ACH when it becomes effective on Sept. 23, 2016. According to the U.S. Treasury, any ACH transaction originated from, or received by, the U.S. government will not be eligible for same-day settlement, and will continue to settle on a future date regardless of submission date and time. This limitation applies only to Federal government payments, and not to state or local government agency payments.
 

For additional FAQs please see the Federal Reserve’s Same Day ACH Resource Center:
https://www.frbservices.org/resourcecenter/sameday_ach/index.html (link is external)

RESULTS OF THE DECEMBER 2014 REQUEST FOR COMMENT ON MOVING PAYMENTS FASTER WITH SAME DAY ACH
MARCH 17, 2015

 
Topic Summary
NACHA issued a Request for Comment on December 8, 2014 on a proposal to provide a new, ubiquitous capability for moving ACH payments faster. The proposal would amend the NACHA Operating Rules to enable the option of same-day processing of virtually any ACH payment. Comments were due by February 6, 2015.
 
Rulemaking Process
Through dialogue and collaboration, NACHA continuously works with the financial services industry and ACH Network participants to make improvements to the NACHA Operating Rules. An RFC is the step in which NACHA gains feedback on ideas around potential rule changes. (More information on NACHA’s rulemaking process can be found at https://www.nacha.org/rules/rulemaking-process.)
 
Responses and Respondent Demographics
NACHA received 214 responses to the RFC, including 181 surveys and 43 comment letters, with some organizations submitting both a survey and a comment letter. Respondents included:
 
Survey Responses
Financial Institutions - 141

  • 24% less than $250M assets
  • 28% $250M - $1B assets
  • 36% $1B – $100B assets
  • 12% greater than $100B assets

Vendors/processors - 22
Regional Payments Associations - 8
End-users (including U.S. Treasury) - 6
ACH Operators - 2
Associations representing processors - 2
 
Comment Letters
Corporate/end-user associations - 8
Financial Institutions - 8
Regional Payments Associations - 6
Financial Institution national associations - 5
Financial Institution state associations - 5
End-users - 3
Vendors/processors - 3
ACH Operators - 2
Others - 3
 
RFC Results
Industry feedback was strongly supportive of moving payments faster with Same Day ACH. Most parties agreed with the proposal to move payments faster on the ACH Network; 92% of survey respondents supported the proposal. Same Day ACH has strong support to move forward to ballot.
 
General Feedback Next Steps
Following the close of the comment period on the RFC, the full Rules and Operations Committee reviewed the responses. It is anticipated that this Rule will be balloted among NACHA’s voting members in early 2Q 2015.
 

  1. New, Ubiquitous Same Day ACH Functionality
  • ​​Feedback reflected strong support for the proposal and for moving forward. 92% of survey respondents supported the proposal; most supported the proposal “as is” and others with suggested changes.
  • Of those suggesting changes, the top five changes cited were operational or technical in nature and included:

    • 35% - Timing of clearing window(s)
    • 28% - Timing of settlement
    • 9% - Need same-day transaction identifier
    • 5% - Different or no transaction dollar limit
    • 4% - Implementation date(s)
  • Respondents representing retail groups preferred moving forward with real-time payment functionality. For instance, they requested finding ways to “unbatch” transactions and offer real-time validation of good funds.
  1. Use Cases
  • Industry input validated the 10 use cases outlined in the proposal. More than 87% of respondents said their organization would use Same Day ACH for one or more of the use cases outlined.
  • The top five cited uses of Same Day ACH were:

    • 87% - Payroll
    • 72% - Business-to-business
    • 59% - Account-to-account transfers
    • 57% - Person-to-person payments
    • 53% - Bill payments
  • This feedback reiterates NACHA’s research finding that 60% of projected Same Day ACH volume will come from existing ACH.
  • Organizations representing broad categories of Originators, that are projected to generate the majority of Same Day ACH volume, strongly supported the proposal as a new option in addition to existing ACH schedules and services. 
  1. Ubiquity
  • Feedback nearly unanimously supported the need for ubiquity with Same Day ACH. 96% of survey respondents agreed that all RDFIs should be required to receive Same Day ACH transactions.
  • To achieve this ubiquity, the RFC proposal included a methodology for setting an interbank fee to be paid from the ODFI to the RDFI.  
  1. Balanced Approach
  • The interbank fee was supported or accepted by a large portion of the industry, including financial institutions and the organizations representing the largest number of end-users of the ACH Network.
  • For RDFIs, the interbank fee was deemed critical for successful adoption of Same Day ACH. 57% of RDFIs responding to the survey said they would not support adopting Same Day ACH without an interbank fee.
  • Comment letters showed that all banking organizations supported the inclusion of the interbank fee. Many financial institution respondents indicated that the payback period of 11.5 years is too long.
  • The largest ACH end-user groups accepted the interbank fee, as long as existing next-day ACH remains an option.
  • Respondents representing the retailer community outlined concerns with or opposition to the interbank fee or components of it. In addition, these respondents wanted clarifications on the components of the fee, as well as the effectiveness of periodic reviews of the fee amount. 
  1. Technical Topics
  • Responses indicated virtually all ACH payments, both debits and credits, should be eligible for Same Day ACH, with 92% of respondents supporting this approach.   
  • Consistently, the most cited changes requested were operational or technical in nature. These included:

    • Timing of each clearing and settlement window

      • Feedback pointed to possible adjustments for the timing of the morning and afternoon windows. Some respondents wanted the windows earlier, and some wanted them later.
    • Identifying Same Day ACH transactions

      • For some respondents, using the existing Effective Entry Date worked well; others expressed that having a new identifier for same-day transactions would be preferable.  
      • Comments suggested NACHA should consider the advantages of using the Effective Entry Date and those of creating a new same-day identifier.  
    • Implementation dates and phase timing

      • Feedback reflected that many respondents supported the phases and implementation dates as outlined, as long as the ballot timeframe allowed for appropriate budget cycle planning in early Q2 2015.
      • Some respondents felt that more time was necessary to prepare for Phase I implementation; others replied that Phase 3 would need the most preparation to allow for funds availability requirements. Still other feedback indicated the industry should move faster and implement sooner than 2016.