Fed Action Allows Same-Day ACH to Move Forward

As ABA had advocated, the Federal Reserve today finalized changes aligning the regional Federal Reserve Banks’ FedACH system with NACHA’s same-day ACH rule, helping to ensure the ubiquity of same-day ACH for financial institution customers. NACHA’s rule requires financial institutions to have same-day ACH capability and requires sending institutions to pay a 5.2 cent per-transaction fee to offset the costs of participating in same-day ACH.

ABA applauded the Fed’s action. “Same-day ACH gives customers more flexibility in managing their finances and can improve the efficiency of the payments system,” said ABA VP Steve Kenneally. “This forward-thinking step demonstrates the continued leadership of the banking industry in payments innovation.”

In reviewing the pros and cons of mandatory participation and the 5.2 cent per-transaction fee paid to receiving institutions, the Fed noted “widespread industry support” for NACHA’s rule change and determined that “costs incurred to implement such a service are outweighed by the enhanced efficiency of the ACH network and the broader U.S. payment system.”

The Fed contrasted the NACHA approach with the current FedACH same-day payment service, which is not mandatory and has only a handful of participants. “[T]he limited adoption of the Reserve Banks’ current FedACH SameDay Service demonstrates an optional service cannot achieve the ubiquity necessary to establish a successful same-day ACH service,” it noted.