By Justin Lutes, AAP, NCP, Vice President of Correspondent Services
Taking advantage of add-on services, such as an ACH solution, from your core provider just makes sense for credit unions. Or does it?
Although core providers may offer incentives to gain your add-on ACH business, you’ll want to ensure their product functionality, features, service and support match yours and your members’ expectations before signing the contract.
A core provider’s number one goal is to sell their core solution; the ACH module is a secondary revenue stream. Many core providers, wanting to round out their offerings with an ACH solution, acquired small ACH vendors – in some cases, over a decade ago – to fill that gap. Because ACH is not the core competency, your members could get an underperforming system, with few beyond-basic features. In addition, development dollars for ACH system updates may be limited to those necessary to keep up with Nacha rule changes. Ideally, you want to find a company that is continually enhancing its solution.
Beyond-basic ACH features
To serve members well, credit unions should look for a service that offers a breadth of features. For example, modern full-service platforms offer such features as schedulers for recurring batches; templates; built-in SEC codes; workflow automation; automated OFAC checking; and risk tools that monitor such things as SEC codes, temporal risk and return rates – all strongly suggested or required by Nacha. Risk tools can be costly if you have to purchase them from another vendor and integrate with the core application, and this will likely require creating operational procedures to manage the workflow. All these increase the cost to use a core solution.
Functionality that caters to business members
Another consideration is how effectively a core’s ACH solution meets the needs of your business members. Payments will be your credit union’s key touchpoint with business members, and possibly the only interaction. A weak ACH solution may suggest that your credit union lacks sophistication and prompt businesses to explore the bank down the street.
On the other hand, a strong ACH solution will enable businesses (as well as your credit union) to originate directly in the ACH interface or to upload files from, say, an accounting system or online banking module. A strong solution will provide access to receipt and origination files in one place and archives to search for transactions and generate returns.
It will offer business-friendly tools, like warehousing, which allows files to be submitted and retained days/weeks in advance until ready to send, and anomaly detection, which automatically monitors transactions in real time and alerts the credit union to suspicious activity and protects member businesses from business account takeover fraud. Credit unions should also expect credit risk management functionality that automates risk management for business member ACH transactions.
As you consider a provider for your ACH services, these questions might help:
- Is your provider easy to work with, attentive to your needs, and prone to business practices that ultimately benefit your credit union? Will they work toward your success?
- What does the end user experience look like for your credit union and its business members?
- Does the platform offer features that meet yours and your members’ needs?
- What type of support and service does the provider offer?
- Does the provider make ongoing system enhancements?
- Is your ACH solution supported by AAPs (Accredited ACH Professionals)?
Through its recent acquisition of Aptys Solutions – a leading provider of real-time processing and electronic payments solutions – Catalyst Corporate offers a new, complete ACH service, called ACHOne. The platform is easy to use for both credit unions and business members and features robust functionality, with ongoing updates to the technology and user interface…ensuring it remains user friendly and safe. And because it’s credit union-owned, you can be sure Catalyst Corporate will work toward your success.
To find out more about ACHOne, or to discuss your credit union’s ACH needs, contact us today.