Same Day ACH Payments: Three Phases

Posted on 05-18-2016 by
Tags: Industry Insights & Trends , Banking , Trending News & Topics , LIT , sheshunoff , Securities

Source: Shutterstock / Georgejmclittle

The article below was written by Holly Merrill, co-author of two books from LexisNexis Sheshunoff: Automated Clearing House Transactions: Operations, Compliance, and Audit and the ACH Training Manual.

In recent years, businesses have been increasingly clamoring for the ACH network to become more responsive to changes in the speed with which commerce is conducted in the 21st century. Financial institutions, NACHA and federal regulators listened. Now, after extensive discussion and exploration, we’re on the verge of a sea of change in the payments industry.

In May 2015, NACHA’s membership voted overwhelmingly to adopt Same Day ACH, a new rule that will make it possible to execute same-day ACH transactions. The purpose of Same Day ACH is to allow transactions that need to move faster to be prioritized and sent into a same-day processing queue.

The rule will be rolled out in a three-phase process, with the first phase going into effect on September 23, 2016.

In Phase One, the focus will be on ACH Credits such as payroll, person-to-person payments and expedited bill payments. In this phase, two processing windows will spread the volume throughout the day and lessen the strain on resources at the end of the day. The proposed Morning Same Day ACH window will be submitted by 10:30 a.m. and settled by 1:00 p.m. Eastern Time; the afternoon window will be submitted by 3:00 p.m. and settled by 5:00 p.m. Eastern Time, with funds available to customers at the end of the processing day.

In Phase Two, which will begin on September 15, 2017, same-day ACH debits will be introduced. The focus in this phase will be on consumer bill payments and the structure of the same-day debit payment windows will be the same as in Phase One: two processing windows at 10:30 a.m. and 3:00 p.m. Eastern Time and settlement taking place at 1:00 p.m. and 5:00 p.m.

In Phase Three, which will go into effect on March 16, 2018, receiving financial institutions will be required to provide funds availability at 5:00 p.m. local time for same-day credit entries.


Download the full PDF, “Same Day ACH Allows Payments to Move Faster,” for deeper insights into the new laws’ implications.

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About the Author:

Photo Credit: GIACT

Photo Credit: GIACT

Holly Merrill, AAP, is the Chief Compliance Officer for GIACT Systems, a national provider of Account and Identity Verification Services. Holly has more than 37 years of experience in payments, including serving as CEO of PaymentsPLUS, CEO of Payments Resource One (PRO) one of the Regional Payments Associations that was also one of the private sector ACH operators. She is also a past member of the NACHA Board of Directors, the National Organization of Check Clearing Houses Board of Directors.

Holly is co-author of two books from LexisNexis Sheshunoff: Automated Clearing House Transactions: Operations, Compliance, and Audit and the ACH Training Manual. She is also a frequent speaker and conducts Sheshunoff's ACH certification training webinars.

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