ACHZone

ACH Fed Settlement FAQs

• Will Same-Day ACH settlement amounts be received from the Fed on the same day as the file submission?

  Yes. Same-Day ACH items can be included in the 10:30 a.m. CT and 2:30 p.m. CT receipt files and 2:40 p.m. CT and 3:45 p.m. CT Same Day return (receipt) files. The Fed settlement times for those items will be noon CT, 4 p.m. CT and 4:30 p.m. CT. A new Same Day origination time of 3:45 p.m. CT, receipt time of 4:30 p.m. CT, and settlement window at 5 p.m. CT will be added on March 19, 2021.

• Will we receive multiple settlement files from the Federal Reserve?

  The Federal Reserve will send settlement files at noon CT, 4 p.m. CT, 4:30 p.m. CT, and 7:30 a.m. CT. Settlement for Same-Day ACH items can be included in the noon CT, 4 p.m. CT, and 4:30 p.m. CT files. On March 19, 2021, another settlement window will be added at 5 p.m. CT.

ACH Online/Origination FAQs

• If we use Catalyst Corporate for ACH origination, will Catalyst make files available for release several times a day?

  Yes. Transactions released in Catalyst Corporate's ACH origination software will be sent to the Federal Reserve at 8:30 a.m. CT, 12:45 p.m. CT, 2 p.m. CT and 6:30 p.m. CT. On March 19, 2021, another window will be added to accommodate the new Same Day origination deadline of 3:45 p.m. CT.

• If we use Catalyst Corporate for ACH origination, how can we create a Same-Day ACH transaction?

  Items released prior to 8:30 a.m. CT or 12:45 p.m. CT with a current or stale-dated (previous date) effective entry date will be processed as a Same-Day ACH transaction. International ACH transactions (IATs) and high-value transactions above $100,000 are not eligible). On March 19, 2021, another window will be added to accommodate the new Same Day origination deadline of 3:45 p.m. CT.  

Nacha Rules FAQs

• Are there any changes to the Nacha Rules for return codes in 2020?

  On April 1, 2020, Nacha changed the description for both Return Codes R10 and R11.  According to Nacha Rules, “Under the Rule, Return Reason Code R11 will be repurposed to be used for the return of a debit in which there is an error, but for which there is an authorization. The repurposed description will be “Customer Advises Entry Not In Accordance with the Terms of the Authorization.” Return Reason Code R10 will continue to be used when a consumer claims he or she does not know the Originator, does not have a relationship with the Originator, or did not give authorization for the entry. The description will be “Customer Advises Originator is Not Known to Receiver and/or Is Not Authorized by Receiver to Debit Receiver’s Account.”

  For more information, please consult the Nacha Rules book.

• Will there be any difference between the requirements for return codes R10 and R11?

  According to the Nacha Rules book, “R11 returns will have the same processing requirements and characteristics as R10 returns, and are still considered unauthorized under the Rules.

  • Incorrect EFTs are subject to the same error resolution procedures under Regulation E as unauthorized EFTs.
  • The RDFI will be required to obtain the Receiver’s Written Statement of Unauthorized Debit.
  • The return time frame will be 60 days.
  • R11 returns will be included within the definition and calculation of the Unauthorized Entry Return Rate."

  For more information, please consult the Nacha Rules book.

• Do return codes R10 and R11 allow for disputes?

  According to the Nacha Rules book, “The new definition and use of R11 does not include disputes about goods and services, just as with the current definition and use of R10.”

  For more information please consult the Nacha Rules book.

• What is the difference between Return Code R10 and R11?

  According to the Nacha Rules book, “A key difference between R10 and R11 will be that an Originator will be permitted to correct the underlying error of an R11 return, if possible, and submit a new Entry without being required to obtain a new authorization. The new Entry must be originated within 60 days of the Settlement Date of the R11 Return Entry. In addition, any new Entry for which the underlying error is corrected is subject to the same ODFI warranties and indemnification made in Section 2.4 (e.g., the ODFI warrants that the corrected new Entry is in accordance with the terms of the authorization, it is timely, contains the correct amount, etc.).”

  “Examples of correctable errors include a debit originated for settlement earlier than authorized; a debit for the wrong amount; a debit as part of an Incomplete Transaction; and some types of an improperly reinitiated Entry. Once the Originator has corrected the underlying issue, the Originator will be able to submit a new Entry. Some errors, however, cannot be corrected. Examples of uncorrectable errors include the Originator did not provide the required notice for ARC, BOC, or POP entries prior to accepting the check, or the notice did not conform to the requirements of the Rules; or the source document for an ARC, BOC or POP Entry was ineligible for conversion. In these cases, the Originator will not be able to submit a new Entry.”

  For more information, please consult the Nacha Rules book.

• Will the Return Code R11 be subject to the Unauthorized Entry Fee?

  Yes.  According to the Nacha Rules book, “On April 1, 2021, the repurposed return code will become covered by the existing Unauthorized Entry Fee. This part of the Rule will be implemented by the ACH Operators, and as with the current fee, will be billed/credited on their monthly statements of charges.”

  For more information on the Unauthorized Entry Fee or the Return Reason Codes, please consult the Nacha Rules book.

• What is Same-Day ACH?

  Nacha has adopted a rule for moving ACH payments faster. The rule enables same-day processing of virtually any ACH payment. Most ACH payments are settled on the next business day; however, businesses and consumers benefit from same-day processing in many scenarios.

  This Nacha rule provides ACH originators the option to send Same-Day ACH transactions to accounts at any receiving financial institution (RDFI). The rule includes a “same-day fee” on each Same-Day ACH transaction, so that RDFIs recover, on average, their costs for enabling and supporting Same-Day ACH.

  Virtually all types of ACH payments, including both credits and debits are eligible for same-day processing. Only international ACH transactions (IATs) and high-value transactions above $100,000 are not eligible.

• Will Nacha add another Same Day processing window?

  On March 19, 2021, Nacha will implement a new processing window. According to the Nacha Rules book, “The new window will allow Same Day ACH files to be submitted to the ACH Operators until 3:45 p.m. CT. RDFIs will receive files from this third window by 4:30 p.m. CT, with interbank settlement occurring at 5 p.m. CT. RDFIs will need to make funds available for credits processed in the new window by the end of their processing for that Settlement Date. All credits and debits, and all returns, will be eligible to be processed in the new Same Day ACH window, with the exception of International ACH Transactions (IATs), Automated Enrollment Entries (ENRs), and forward entries in excess of the per-transaction dollar limit.
  
  Each institution should contact their processor for the time they will deliver items to the Fed for this new window.  The delivery time for items entered in the Catalyst origination software is TBD.

  Please consult the Nacha Rules book for more information on the new Same Day window.

• What is an Unauthorized Entry Fee? (effective October 3, 2016)

  Nacha implemented a rule intended to improve ACH Network quality by reducing the incidence of ACH debits returned as "unauthorized." Under this rule, an Originating Depository Financial Institution (ODFI) will pay a $4.50 fee to the Receiving Depository Financial Institution (RDFI) for each "unauthorized" return.

• What are the Guidelines Regarding the Timing of Debit Entry Postings?

  “An RDFI must not debit the amount of any Entry to a Receiver’s account prior to the Settlement Date of the Entry, even if the Effective Entry Date of the Entry is different from the Settlement Date of the Entry.” 

  For more information please refer to the Nacha Rules Book, Timing of Debit Entries

• What are the Guidelines Regarding the Timing of Credit Entry Postings?

  “An RDFI must make the amount of each credit entry received from its ACH Operator available to the Receiver for withdrawal no later than the Settlement Date of Entry, subject to its right to return the Entry under ACH rules. Funds from same day credits received in the first Same Day ACH processing window will be available for withdrawal by 1:30 p.m. RDFI local time. Funds from same day credits received in the second Same Day ACH processing window will be available to the Receiver for withdrawal by 5:00 p.m. RDFI local time.”  A new Same Day receipt window will be added on March 19, 2021 at 4:30 p.m. CT, and funds from the Same Day items received in that file will have to be posted by the end of the institution’s processing day.

  For more information please refer to the Nacha Rules Book, Availability of Credit Entries to Receivers and Faster Funds Availability.

• What is an addenda record and what information does it provide?

  An addenda record (or 7 record) can be utilized by the ODFI to provide more information to the RDFI on a transaction if allowed by the specific Standard Entry Class (SEC) code.  If an item is a return, the addenda record will show the return reason code.  If the item is a Notice of Change (NOC), the addenda record will show the change code and the corrected information.  For more information, please refer to the Nacha rules book.

• What is a Standard Entry Class Code (SEC)?

  The SEC code is used to identify the type of ACH transaction. For example, TEL is a transaction that was requested via the phone, CCD is a transaction for a corporate customer, and a POP is a paper check converted to an ACH item. For more information concerning SEC codes, please refer to the Nacha rules book

• How does the Standard Entry Class Code (SEC) work with the return code?

  • The SEC code is used to determine the appropriate return reason code for an ACH transaction. For example, RCK (return paper check converted to ACH) has its own return reason codes. A return reason code of R51 is used to return an unauthorized RCK, but R10 is used to return other unauthorized check payments such as ARC, BOC, POP. The Nacha rules book includes a detailed table of return reason codes along with the SEC codes for which they can be used.

  To see a complete list of all Nacha rules, visit the Nacha website.

Same-Day ACH FAQs

• What is Same-Day ACH?

  Nacha adopted a rule for moving ACH payments faster. The rule enables same-day processing of virtually any ACH payment. Most ACH payments are settled on the next business day; however, businesses and consumers could benefit from same-day processing in many scenarios.

  This Nacha rule provides ACH originators the option to send Same-Day ACH transactions to accounts at any receiving financial institution (RDFI). The rule includes a “same-day fee” on each Same-Day ACH transaction, so that RDFIs recover, on average, their costs for enabling and supporting Same-Day ACH.

  Virtually all types of ACH payments, including both credits and debits, are eligible for same-day processing. Only international ACH transactions (IATs) and high-value transactions above $100,000 are not eligible.

• Are we required to participate in Same-Day ACH?

  Same-Day ACH is mandatory for all RDFIs, but it is optional for ODFIs.

• Do we send returns once a day, or should we send them multiple times per day? If once a day, would we wait until the end of the day?

  The credit union can choose how often to process returns during the day. Catalyst Corporate sends returns entered in TranZact to the Federal Reserve at 2 p.m. CT and 6:30 p.m. CT. Returns (and originations) entered in Catalyst Corporate's ACH origination software are sent to the Federal Reserve at 8:30 a.m. CT, 12:45 p.m. CT, 2 p.m. CT and 6:30 p.m. CT. After returns are sent to the Federal Reserve, they cannot be retrieved or deleted. Effective September 28. 2020, when Catalyst Corporate’s new ACHOne platform is live, ACH returns and originations will no longer be entered in TranZact or ACH Online.

• Do RDFIs get to keep the 5.2 cent fee when they return a Same-Day ACH item?

  Yes. The RDFI does keep the 5.2 cent fee, even if they return the Same-Day ACH item.

• How do we handle the last file transmission of the day if we are closed by the time it is received? Will staff need to work late to post this last file?

  Same-Day ACH items can be included in the 10:30 a.m. CT and 2:30 p.m. CT receipt files and 2:40 p.m. CT and 3:45 p.m. CT return (receipt) files. Same Day credit items received in the 10:30 a.m. CT file must be available to the member no later than 1:30 p.m. RDFI local time and items in the 2:30 p.m. CT file by 5 p.m. RDFI local time. The 2:40 p.m. CT and 3:45 p.m. CT Same Day return (receipt) files will only contain returns, and the Nacha return time frames would apply.  Another Same Day receipt window will be added on March 19, 2021 at 4:30 p.m. CT, and the funds for those Same Day items must be made available by the end of the processing day. All future dated items can be posted on the settlement dates. The credit union will need to review their policy and the Nacha Rules book for posting items outside the mandatory Nacha Rules (i.e. posting credits before the effective date).

• How does Same-Day ACH work for early closings and holidays (i.e. the day after Thanksgiving)?

  Please refer to the Federal Reserve’s standard holiday schedule. Same Day credit items received in the 10:30 a.m. CT file must be available to the member no later than 1:30 p.m. RDFI local time and items in the 2:30 p.m. CT file by 5 p.m. RDFI local time. The 2:40 p.m. CT and 3:45 p.m. CT Same Day return (receipt) files will only contain returns, and the Nacha return time frames would apply. Another Same Day receipt window will be added on March 19, 2021 at 4:30 p.m. CT, and the funds for those Same Day items must be made available by the end of the processing day. The credit union will need to review their policy for posting items outside the mandatory Nacha Rules (i.e. posting credits before the effective date).

• How does Same-Day ACH affect settlement at Catalyst Corporate? When do the charges reflect on our corporate account?

  The Fed has multiple settlements, and Catalyst Corporate will post the settlements as they are received. The receipt file settlements will be received at noon CT, 4 p.m. CT, 4:30 p.m. CT, and 7:30 a.m. CT. Settlement for Same-Day ACH items can be included in the noon CT, 4 p.m. CT, and 4:30 p.m. CT settlements. The Fed will send settlements for origination items at noon CT, 4 p.m. CT, and 7:30 a.m. CT. Another Same Day window will be created on March 19, 2021, which will result in a new settlement window of 5 p.m. CT.

• If we pick up the last file of the day, can we wait until the next morning to work those entries?

  Per Nacha Rules, “Funds from same day credits received in the first Same Day ACH processing window will be available for withdrawal by 1:30 p.m. RDFI local time. Funds from same day credits received in the second Same Day ACH processing window will be available to the Receiver for withdrawal by 5 p.m. RDFI local time. A new Same Day receipt window will be added on March 19, 2021 at 4:30 p.m. CT, and Same Day items received in that file will have to be posted by the end of the institution’s processing day. Funds from non-Same Day ACH credits made available to the RDFI by 5 p.m., RDFI local time, on the banking day before settlement will be available to the Receiver for withdrawal on Settlement Date by 9 a.m., RDFI local time.

  For more information please refer to the Nacha Rules Book, Faster Funds Availability.

• Does Catalyst send items released in their origination software multiple times per day to the Fed?

  Yes. Transactions released  in Catalyst Corporate's ACH origination software will be sent to the Federal Reserve at 8:30 a.m. CT, 12:45 p.m. CT, 2 p.m. CT and 6:30 p.m. CT.

• If you receive an item in the morning, do you have to wait until the end of the day to return it?

  The item can be returned the same day, but it is up to the credit union to determine what time of day they process their returns. Returns entered in TranZact will be sent to the Federal Reserve at 2 p.m. CT and 6:30 p.m. CT. Returns entered in Catalyst Corporate's ACH origination software will be sent to the Fed at 8:30 a.m. CT, 12:45 p.m. CT, 2 p.m. CT and 6:30 p.m. CT. After returns are sent to the Federal Reserve, they cannot be retrieved or deleted.

• We generally post payroll credits a day before the effective date. Should these changes affect or change this practice?

  You may continue to post credits early, but the Fed will not send the settlement for those transactions until the effective date.

• What's the timeframe for returning Same-Day ACH debit transactions?

  Same-Day ACH does not change the Nacha Rules for the return time frames. According to the Nacha Rules, returns need to be made available to the ODFI no later than the opening of business the second banking day following the settlement date of the original entry. That applies for both credit and debit entries. For further information, please refer to the Nacha Rules book or Nacha's website.

• Will Same-Day ACH settlement amounts be received from the Fed on the same day as the file submission?

  Yes. Same-Day ACH items can be included in the 10:30 a.m. CT, 2:30 p.m. CT and 4 p.m. CT receipt files. The Fed settlement for those items will be received at noon CT, 4 p.m. CT and 4:30 p.m. CT. A new Same Day window will be added for receipt and origination on March 19, 2021, which will create another settlement window at 5 p.m. CT.

• Will we receive multiple settlement files from the Federal Reserve?

  The Federal Reserve will send settlement files at noon CT, 4 p.m. CT, 4:30 p.m. CT, and 7:30 a.m. CT.  Settlement for Same-Day ACH items can be included in the noon CT, 4 p.m. CT and 4:30 p.m. CT files. A new Same Day window will be added for receipt and origination on March 19, 2021, which will create another settlement window at 5 p.m. CT.

• Are returns, notifications of change (NOCs) and death notification entries (DNEs) included in the Same-Day ACH rule?

  Yes. For further information, please review "Same Day ACH: Moving Payments Faster" in the Nacha Rules book or on Nacha's website.

• Can returns be included in all receipt files?

  Yes, returns may be included in all receipt files. Same-Day ACH items originated in Catalyst Corporate's ACH origination software may be returned to your credit union the same day in the 2:30 p.m. CT receipt file or 2:40 p.m CT and 3:45 p.m. CT Same Day return (receipt) file deliveries. Those files can also include items dishonored and contested returns. A new receipt window for Same Day items will be added at 4:30 p.m. CT on March 19, 2021.

  Please consult the Nacha Rules book for return time frames.

• Can future dated CREDIT items be posted the day they are received?

  Per Nacha operating rules, ACH credits can be delivered up to two banking days prior to the Settlement Date. It is recommended that credits be posted on the Settlement Date, however, credits can be posted prior to the Settlement Date if your credit union’s policy allows.

• Can future dated DEBIT items be posted the day they are received?

  Per Nacha operating rules, ACH Debits can be delivered no earlier than 1 day prior to the Settlement Date but cannot be posted prior to the Settlement Date, therefore, credit unions that do not currently warehouse ACH items will need to pay close attention to Settlement Dates.

• Is the over $100,000 value limit applied to a single item or to a batch?

  The over $100,000 limit applies to a single item.

• What happens if a batch submitted for same-day settlement contains one or more item(s) over $100,000?

  All items in the batch will be processed, and the item(s) over $100,000 will be assigned the next business day's settlement date, whereas the remaining items will receive same-day settlement.

• What is the difference between the effective date and the settlement date?

  The date that the originator requests an item to be posted is the effective date, and the settlement date is when the Federal Reserve (or EPN) will settle the transaction with the financial institution.  Items should be posted by the settlement date.

• Will Real Time Payments be sent through the ACH network?

  No. Real Time Payments will go through a different network. They will not be ACH items or governed by the Nacha Rules and Regulations.

TranZact ACH Receipt FAQs

• Do we send returns once a day, or should we send them multiple times per day? If once a day, would we wait until the end of the day?

  The credit union can choose how often to process returns during the day. Returns entered in TranZact will be sent to the Federal Reserve at 2 p.m. CT and 6:30 p.m. CT. Returns entered in Catalyst Corporate's ACH origination software will be sent to the Federal Reserve at 8:30 a.m. CT, 12:45 p.m. CT, 2 p.m. CT and 6:30 p.m. CT. Effective September 28, 2020, Catalyst Corporate's new ACHOne platform will go live. At that time, returns will no longer be entered in ACH Online or TranZact.

• Are there any exceptions to the times the ACH receipt files are made available?

  Yes. On Fridays, the Fed holds the 7:30 p.m. CT file until Sunday night. Also, on the eve of a Fed holiday, the Fed holds the 7:30 p.m. CT file until the night prior to the next business day. The 2:30 a.m. CT files are always made available on the morning of the next business day.