The first phase of Same Day ACH Rule is just around the corner. As of Sept. 23, 2016, credit transactions will be eligible for same-day processing and settlement, with availability by the end of the processing day for Receiving Depository Financial Institutions (RDFIs).
Though it’s optional for Originating Depository Financial Institutions (ODFIs) to offer same-day ACH, to avoid potential FFIEC penalties for violating NACHA operating rules and to take advantage of potential marketing opportunities, your financial institution should start thinking like a same-day ODFI sooner rather than later.
For Your Consideration: Same-Day Origination
While you may not intend to offer a marketable, premium same-day service as an ODFI, there are some items to consider before making your decision:
- In Case of Emergency
You’ve been there … a business customer needs emergency payroll. How do you help them resolve the payroll issue? Do you utilize same-day ACH? Consider how you will help—and if you want to help—when an originator misses a payroll file and comes to you in an emergency. Whether or not your financial institution decides to offer a same-day ACH solution, first ask yourself how you could leverage same-day ACH.
- Internal Bank Education
Is your staff prepared to answer questions about same-day ACH? From decision makers, who need to determine if the bank is moving forward with this initiative, to bank tellers, who may be facing customer questions about how same-day ACH works, make sure you arm your staff with base-line understanding of how these transactions are processed.
- Customer Opportunity
As same-day ACH spreads across the banking industry, your business customers’ day-to-day ACH payments processing could be affected. Identify what business customers you may have that could leverage a premium service for same-day origination. Whatever your decision, be proactive in helping those customers understand these types of transactions, and be prepared to answer questions about how they’ll be receiving same-day ACH payments as well.
- Operational Processes and Procedures
Consider what same-day ACH would look like at your institution—how does it change your current processes and procedures? Identify the operational processes and procedures that may be affected if your financial institution were to adopt same-day origination. Then, start to identify what enhancements are needed, how risk monitoring and day-to-day payments processing will change, and how internal staff will be affected by process changes.
Identify the Capacity and Level at Which You Could Offer Same-Day Origination
In a world increasingly dominated by digital payments and instant gratification, same-day ACH is certain to affect your financial institution—but, to what capacity is up to your bank. Start by educating decision makers and appropriate staff, and then put some serious thought into your financial institution’s decision regarding same-day origination. Be strategic in your decision, because the path you take will have long-term implications on operations and maybe even profitability.
Greg Aumann is the application product manager for NuPoint ACH. He is responsible for ensuring the application remains competitive and compliant in today’s rapidly changing ACH environment. Greg is an Accredited ACH Professional (AAP) and is also a member of EPCOR’s Education Committee.