Plans Move Forward for “Same Day ACH”

You know about ACH — those Automated Clearing House payments that we also offer here at AVPS. Sometimes called “Electronic Check Processing,” it is, as our own website notes, “a form of electronic payment… often confused with a wire transfer because it works in a similar fashion. However, unlike a traditional wire transfer, it can be used to process higher amounts, or for small payments which may settle from 1 to 2 business days.”

ACH has also been used to accept checks online, combining older payment methods with new. but, as a diligent reader of this blog, you know that the entire payment landscape continues to shift and change, even as we speak.

And today, we speak of the changes coming to ACH.

As the NACS Online site reports — that’s the association for convenience stores (and gas station/convenience store combos) — the “The Electronic Payments Association (or NACHA) announced that its voting membership approved Same Day ACH, enabling same-day capability for virtually any ACH transaction and creating options for the businesses, governments and consumers who want to move their money faster.”

NACHA’s President, Janet O. Estep, as quoted in the Greensheet industry newsletter says “Same Day ACH serves as an immediate action the industry has undertaken to modernize the payments system and creates a building block for a variety of products and services.”

In their overview of the changes, the site expounds a bit on how it will work: “As part of the new rule approved by the membership, there will be two additional same-day settlement windows. Any originating institution can offer products that clear on the same day knowing that all receiving institutions will have the capability, as required by the rule change, to process the transactions that same day.”

There’ll be some time to get ready: The first of the three “phases” for the ACH changes starts in the fall of 2016 (the fall of 2015, after all, will be keeping everyone busy with the EMV switchover): In Phase 1, as NACS summarizes, “ACH credit transactions will be eligible for same day processing, supporting use cases such as hourly payroll, person-to-person (P2P) payments and same-day bill pay. In Phase 2, same-day ACH debits will be added, allowing for a wide variety of consumer bill payment use cases like utility, mortgage, loan and credit card payments. Phase 3 introduces faster ACH credit funds availability requirements for Receiving Depository Financial Institutions (RDFI).”

So the ACH Debits, in Phase 2 especially, will become another method of virtual, instant payment.

Whether this means that each consumer’s personal financial institution will then  be able to act in a sort of “PayPal” vein — with their own “instant payment” protocols and apps — remains to be seen, but the way your business gets paid (and the way you pay others) will continue to shift and change, regardless, much as the sands on that summer beach you’re contemplating right now.

AVPS, meanwhile, is here to help you get ready for it, so when fall of ‘16 rolls around, you’ll be able to say: “That’s so last year!”

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