NACHA Rule and Product Changes
Over the past few years, NACHA has mandated several important rule changes to expand the use of the ACH network. Some of the more significant changes include:
- Development of a framework to support broader use of international ACH credit and debit transactions and to identify and report international ACH transactions subject to OFAC restrictions. (Effective September 2009See NACHA International Transactions Executive Summary: http://www.nacha.org/IAT_Industry_Information/docs/IAT%20Executive%20Summary%207%203108.pdf).
- Acceptance of certain business checks for conversion to ACH debits.
- Back-office processing of eligible checks to ACH debits by retailers and billers (BOC entries).
- Use of the ACH network for presentment of bills to consumers.
- Implementation of more stringent network enforcement rules that include more substantial fines for certain violations and permit the ACH Rules Enforcement Panel to direct an ODFI to suspend an originating third party sender.
- Requirement that companies identify themselves within the ACH transaction by the name that is known to, and readily recognized by, the consumer.The ODFI reporting requirements also requires ODFI to provide NACHA with information pertaining to each originator or 3rd party sender return rates which exceed a defined threshold.
NACHA also requires that every financial institution conduct an annual internal or external audit of compliance with the ACH rules no later than December 31 of each year, and that the audit be made available to NACHA upon request. While the requirements for the "ACH Rule Compliance Audit" do not prescribe a specific methodology, NACHA does identify specific criteria that must be considered during the annual audits (NACHA Operating Rules, Appendix Eight). Financial institutions and third-party service providers should have processes in place to ensure their understanding of, and compliance with, these and future rule and product changes.More information about these rule changes and other developments, including proposed rules changes and pilot projects, may be found at the NACHA Web site: www.nacha.org.
The ACH Network
Card-Based Electronic Payments