Same Day ACH
Q: What is Same Day ACH?
A: The National Automated Clearinghouse Association (NACHA) has adopted a rule to provide a new capability for moving ACH payments faster. The rule will enable the same day processing of most ACH payments. Currently, ACH payments are settled on the next business day. This rule change will enable ACH Originators that desire same day processing the option to send same day ACH transactions to accounts at any Receiving Depository Financial Institution (RDFI). The rule will become effective in three phases as outlined below.
Q: Will all financial institutions offer Same Day ACH origination?
A: Most large ACH originating financial institutions will offer same day ACH origination services; however, it is expected that most midsize and smaller financial institutions will not offer same day ACH origination. Citizens Bank Minnesota offers Same Day ACH origination.
Q: What types of ACH payments are eligible for same day processing?
A: According to NACHA, 99% of ACH transactions will be eligible for same‐day processing. Only international transactions (IATs) and transactions above $25,000 will not be eligible.
Q: When will the three phases of the rule be implemented?
A: Phase 1 will become effective on September 23, 2016
- Includes credits (i.e. payroll and payables), with transactions posted to the recipient's account at end of their RDFI's processing day, which varies by institution.
Phase 2 will become effective on September 15, 2017
- Includes both credits (i.e. payroll and payables) and debits (receivables, rent collection) with transactions posted to the recipient's account at end of RDFI's processing day.
Phase 3 will become effective on March 16, 2018
- Includes both credits and debits with transactions posted to the recipient's account required by RDFI at 5:00 p.m. local time. For Citizens Bank clients, that will be 5:00 p.m. CT.
Q: Will government payments be eligible for same day processing?
A: The federal government did not participate in phase one of Same Day ACH when it became effective on September 23, 2016. However, the U.S. Treasury has committed to participating in Same Day ACH beginning September 15, 2017, in a phased implementation. At that time, the Treasury will be able to receive tax and non-tax Same Day ACH credits.
Q: Will the current ACH processing schedule change?
A: The rule enables the option for Same Day ACH payments through new ACH Network functionality, without affecting existing ACH schedules and capabilities.
Q: Is there an additional fee for originating Same Day ACH payments?
A: Yes, there is a different pricing schedule for Same Day ACH origination. Please contact Kathy Drexler, firstname.lastname@example.org, at Citizens Bank Minnesota for pricing information or refer to the ACH Agreement Fee Schedule.
Q: How do I sign up for Same Day ACH?
A: Contact Kathy Drexler at Citizens Bank Minnesota for more details on Same Day ACH Origination.
Q: If I receive a Same Day ACH Credit or Debit, when will I see it in my account and how will I know it was a Same Day ACH?
A: Same Day ACH entries received to your account will post by the end of the bank's posting day. The transaction will post to your account with the same type of transaction description and details as the ACH entries that currently post to your account today. Keep in mind that Same-Day ACH transactions are not immediate. A transaction that is initiated first thing in the morning will be required to be posted to a payee's receivables effective that business day - which could be the end of the day.
Q: What are the benefits of Same Day Electronic Payment?
A: Many merchants and billing companies may offer you the option to make a same-day electronic payment, such as to pay a bill or to transfer funds. If you agree, then the funds might be debited from your account as soon as that very same day. For example, if you have a bill due on the 25th of the month, the billing company might allow you to call or use its website on the morning of the 25th to make an on-time payment, and also have the funds debited from your account on the 25th. While these types of payments won't be reflected on your account balance as quickly as your debit card and ATM transactions, you will have access to more accurate information about your actual available account balance more frequently throughout the business day.
Q: How does this rule affect Citizens Bank Minnesota customers?
A: Customers should understand that when they authorize a merchant or biller to debit their account with their financial institution, the merchant or biller should include information or a statement about the timing of the payment. If the merchant or biller offers the customer the option to make a same-day payment, it might be referred to as a same-day payment, or noted that the merchant or biller intends to collect the funds as quickly as possible.
If customers have pre-authorized an electronic payment, such as a recurring mortgage or insurance payment, then very likely there will be no charge to the time that these payments are posted to their account. As always, customers' financial institutions will receive and post these payments normally as designated by the transaction effective date.
Customers should always have sufficient funds in their account to cover every payment they make, authorize, or initiate, and should frequently review their account statements and transactions.