Changes coming to ACH Processing
Wednesday, August 16, 2017
Starting on September 15, 2017, all financial institutions in the U.S. will be required to comply with a new regulatory rule that allows same-day processing of electronic payments and checks converted to electronic payments. This rule affects not only Signal Financial FCU members, but customers/members of all banks and credit unions.
This rule change may result in some payments or checks being taken out of members’ accounts faster than in the past — that is, the same day they were sent for payment by the originator (the company the payment is being made to). Members will need to be careful that they have enough available funds in their account at the time the payment is submitted, so that if a payment is processed the same day it will not overdraw their account. The several-day “float time” that frequently occurred in the past will be greatly reduced.
Members concerned about this rule change can use alerts and mobile and online banking to monitor their accounts, or enroll in one of Signal’s overdraft protection services. Please see our list of Frequently Asked Questions below, read our blog, or call us at 301-933-9100, ext. 298 for more information.
Same Day ACH Processing Frequently Asked Questions
What is Same Day ACH?
Same Day ACH is regulatory change from the National Automated Clearing Association (NACHA). Effective September 15, 2017 this rule will enable same day processing of most electronic payments for ACH credits and debits. This does not apply to Signal Financial FCU-issued Debit or Credit cards.
What is the purpose of Same Day ACH?
The purpose is to allow originators of ACH transactions the ability to process transactions at a faster pace. If you generate a payment from your account with a vendor, utility company, another individual, etc. this will enable those originators to receive their funds sooner. It will also allow companies to issue emergency payroll or other credits to your account the same day.
Is this a Signal Financial FCU change?
No, this rule change applies to all financial institutions in the United States, not just Signal Financial FCU.
What types of payments are eligible for same day processing?
Information obtained from NACHA indicates that 99% of ACH transactions will be eligible for same day processing. The only exceptions are those ACH transactions that are considered International ACH transactions and transactions over $25,000.
The payments that could be included in this are:
- Last minute bill payments to your utility company or other creditors
- Checks written and then later converted to ACH transactions
- Transfers from your account at other financial institutions
- Emergency payroll
The new rule will not apply to federal government agencies. Payroll for those agencies will continue to post as normal.
What will happen to my account?
No changes will be made to your account, however it is always recommended that you have sufficient funds in your account before you initiate any payment. If the funds are not available at the time of posting, it is highly likely that the items will be returned and you will incur a fee on your account in addition to any fees that the originator may charge for the return of the item.
If you write a check to a merchant, that check could be converted to an ACH transaction and post the same day.
How can I avoid overdraft fees?
The best way to avoid overdraft fees is to never initiate or pay a bill unless the funds are available in your account at the time of payment. It is encouraged that you sign up for account alerts via Online Banking to aid in monitoring your account. There are other options available to assist you such as Extended Overdraft Protection, Overdraft protection from your savings account and line of credit if applicable and Courtesy Pay.
What about my credit card and loan payments to Signal Financial FCU?
If you initiate your credit card and loan payments with another financial institution to your credit card or loans here at Signal, your account could possibly be debited the same day.
If you utilize your account here at Signal there will be no changes at this time.
What about Me2Me transfers?
Me2Me Transfers will also be impacted by this rule change, enabling you to receive your funds faster at your other institutions with a transfer initiated from your Signal Financial FCU account. If you would like to enroll in this service please a secure message to our Member Services Department in eBanking to request enrollment.