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I’ve finally gotten “on-board” with Same Day ACH.  For my part, it was not a quick, immediate buy-in, but a slow process. I realize now that after 40 years, and the fact that other countries are already there, the U.S. needs a faster ACH Network.  And, while there are still other industry task forces looking to speed up payments like the Faster Payment Initiatives, Same Day ACH is an important step. I’m all in now.  I’ve been anticipating this exciting change to the ACH Network and I’m ready for it to happen already. 

Recently I’ve had some Ah-ha moments, and after the Ah-ha sunk in, I thought, Oh My Gosh!  The biggest Ah-ha moment was when I realized that any balanced file was going to be a big problem for several different reasons.  Here’s some examples; let’s keep it a simple payroll file.  In credits-only Phase 1 of Same Day ACH, a balanced File could be transmitted in the appropriate window and be eligible for Same Day ACH.  However, while the credits would settle same-day, the debit offset would not settle until the next-day.  Again, assuming a simple payroll file in Phase 2 when debits are allowed, if the offsetting debit is over $25,000, the credits would settle same day and the debit would not settle until the next day.  In these cases, the ODFI would be funding the payroll for the Originator unless additional funding steps were taken. ODFIs offering Same Day ACH will need to review how Files process and address their settlement and credit risk.

The next Ah-ha/OMG moment, I felt as an ACH auditor was how Same Day ACH be audited.  What should be reviewed to prove the last file (4PM ET) was collected and processed timely?  There are so many different processors, all with unique reporting capabilities.  Some reports are detailed with the Effective Entry Date, some with Settlement Date, others include the Julian Date and some just say “Date.”  Where is an auditor to begin?  What RDFI processes will need to change?  Some RDFIs may have less work than others, as a Third-Party Processor will process all of the RDFI responsibilities. However, all RDFIs must be aware of their responsibilities under the Same Day ACH rule and ensure they are in compliance, regardless of who does the processing.  Also, the Funds Availability audit requirement (Appendix 8.3.D) will need to be reviewed but not until Phase 3 in 2018. This seems far away but it’s really just 18 months from the start of Same Day ACH.

My last Ah-ha moment, at least for now, is unintentional Same Day ACH Entries.  Will ACH warehouses be cleaned-up prior to September 23, 2016, to edit stale-dated Entries?  Will Originators, who are in the habit of using today as an Effective Entry Date, think to fix their ACH file formats?  A File could be processed without the intention of being a same-day entry, but because the Originator has not been properly educated, an unintentional File will get processed and a fee will be assessed.  How will the ODFI decide to approach this issue?  That will also be fun to audit.