Important NACHA Rule Changes

March 18, 2022

The Increasing the Same Day ACH Dollar Limit to $1 Million rule will increase the per-transaction dollar limit from $100,000 to $1,000,000. At implementation, both Same Day ACH credits and Same Day ACH debits will be eligible for same day processing up to $1,000,000 per transaction.

What does this mean for you?

If you are an originator, you should be prepared to receive ACH debits or credits up to the new $1,000,000.00 limit. These participants should be ready for possibility of higher dollar transactions posting to their accounts throughout the business day.

September 17, 2021

Meaningful Modernization aims to make the ACH user experience more convenient and consists of The Standing Authorization Rule, The Oral Authorization Rule, The Other Authorization Rule, The Alternative to Proof of Authorization Rule, and The Written Statement of Unauthorized Debit via Electronic or Oral Methods Rule. For a detailed summary of each Rule, please visit NACHA’s website.

What does this mean for you?

If you are an originator, you may choose to take advantage of these changes, however, you may need to modify or add to your authorization practices and language as well as modify your business processes. You must meet “readily identifiable” and “clear and readily understandable” terms for all authorizations as well as meet minimum data standards for all consumer debit authorizations. Please visit NACHA’s website for further information.

September 17, 2021

ACH processing no longer requires originators to use pre-defined values in the Payment type or PTC/DD field for WEB and TEL transactions. Prior to this release, the system required values specified by NACHA rules for these transaction types.

What does this mean for you? 

This change allows originators to enter two-digits, user-defined values in the Payment type field. This field will be treated as optional, and no longer returns the “Invalid payment type code” message during processing or reporting.

March 19, 2021

The New Same Day ACH Processing Window rule will create a new processing window that will enable Originating Depository Financial Institutions (ODFIs), including 1st Source Bank, and their customers to originate same day transactions for an additional two hours each banking day. The new window will allow Same Day ACH files to be submitted to the ACH Operators until 3:30p.m. ET (12:30p.m. PT). Receiving Depository Financial Institutions (RDFIs) will receive files from this third window by 5:30 p.m. ET (2:30 p.m. PT), with interbank settlement occurring at 6:00 p.m. ET (3:00 p.m. PT).

What does this mean for you?

If you are an originator or third-party sender, you will be eligible for originating same day transactions for an additional two hours for each business day, until 3:30p.m.

September 18, 2020

The New Same Day ACH Processing Window rule will create a new processing window that will enable Originating Depository Financial Institutions (ODFIs), including 1st Source Bank, and their customers to originate same day transactions for an additional two hours each banking day. The new window will allow Same Day ACH files to be submitted to the ODFI until 3:30 p.m. ET (12:45 p.m. PT). RDFIs will receive files from this third window by 5:30 p.m. ET (2:30 p.m. PT), with interbank settlement occurring at 6:00 p.m. ET (3:00 p.m. PT).

What does this mean to you?

If you are an originator or third-party sender, you will be eligible for originating same day transactions for an additional two hours each business day, until 3:30p.m.

July 1, 2020

ACH Contact Registry

Under the ACH Contact Registry Rule (the Rule), all ACH financial institutions including 1st Source bank will be required to register contact information for their ACH operations with fraud and/or risk management areas. Financial institutions may voluntarily register contacts for additional personnel or departments at their discretion. The contact information will be available for other registered ACH participating financial institutions, Payments Associations, the ACH Operators and Nacha to use with ACH-related system outages, erroneous payments, duplicates, reversals, fraudulent payments and any other use within scope, such as identifying the proper contact for letters of indemnity. The Rule requires financial institutions to update their registry information within 45 days of any change and to verify it on an annual basis. Registration will be done via Nacha’s Risk Management Portal.

What does this mean for you?

In today’s environment, financial institutions seek ways to contact and communicate quickly with other financial institutions about specific ACH payments and exceptions; error, fraud and risk events; and the recovery of funds, among other issues. ACH Contact Registry may allow 1st Source bank to quickly resolve any upcoming ACH related issues for originators and receivers.

March 20, 2020

The Same Day ACH Dollar Limit Increase rule will increase the per-transaction dollar limit from $25,000 to $100,000. At implementation, both Same Day ACH credits and Same Day ACH debits will be eligible for same day processing up to $100,000 per transaction.

What does this mean for you? 

If you are an originator or third-party sender, you will be eligible to originate and receive debit and/or credit entries up to $100,000.

September 20, 2019

Faster Funds Availability

The Faster Funds Availability Rule will provide faster funds availability for many ACH credits. Funds from Same Day ACH credits processed in the first processing window will be made available by 1:30 p.m., RDFI local time. Funds from non-Same Day ACH credits that are made available to the RDFI by 5:00 p.m., RDFI local time, on the banking day before Settlement Date will be available by 9:00 a.m., RDFI local time, on Settlement Date.

What does this mean for you? 

Non-Same Day credits that are originated by will available to receivers by 9:00 a.m. RDFI (Receiving Depository Financial Institutions) time. Funds for credits that are originated in the first Same Day ACH window will be available to receivers by 1:30p.m.

September 29, 2017

Third-Party Sender Registration

The Third-Party Registration Rule requires every Originating Depository Financial Institution (ODFI), including 1st Source Bank, to register its Third-Party Sender customers with NACHA. The Rule requires the ODFI to provide a limited set of initial, basic registration information for each Third-Party Sender that the ODFI should have in its records.

What does this mean for you?

If you are a Third Party Sender using ACH services with 1st Source Bank, your business name, principal business location and company identifications must be submitted in the registry. The Rule provides for updates and additions. This does not in any way relieve a Third-Party Sender from its obligations under the NACHA Rules.

September 15, 2017

Same Day ACH: Phase 2 – Debits

Phase 2 of Same Day ACH builds upon the foundation established by the initial implementation of Same Day ACH. The Rule is amended to allow same-day processing of debits, specifically debits of $25,000 or less, in Phase 2. The same processing windows allowed for same-day credits will remain for same-day debits. The Rule includes a Same Day Entry fee on each Same Day ACH transaction to cover the costs for the changes in the network to accommodate this new process.

What does this mean for you?

We are not offering this within our standard BBO ACH package. Only those clients specifically approved for ACH Passthru will have the option to participate subject to the processing windows for such transactions. Passthru Originators should be very aware of the effective dates within their NACHA files and the time of day in which the files are submitted. Should an effective date of the current business day or prior be in the NACHA file when submitted, if submitted prior to the last same-day processing window, debits will be settled against the Receivers account that business day. This may not be the intention and had always been future dated by the Fed prior to September 15, but the new Rule will amend this. This could cause debits to post to client account prior to what is intended.

October 3, 2016

Unauthorized Entry Fee

NACHA has implemented a new Unauthorized Entry Fee effective October 3, 2016. The intent of this fee is to improve the quality of the ACH Network by reducing the incidence of ACH debits returned as unauthorized. This fee will be charged to the Originating Financial Institution for compensation to the Receiving/Returning Financial Institution. Returns that fall into this category with a reason of unauthorized or authorization revoked could be any of the following: Return Reason Codes R05, R07, R10, R29, and R51. Return items as of October 3, 2016 would relate to forward entries initiated as early as August 1, 2016