Same-Day ACH Traffic Meets Expectations

Growth in the use of same-day ACH is putting it on pace to hit 120 million debit and credit transactions a year, according to new data from NACHA – the Electronic Payments Association.

In 2017, there were 75.1 same-day ACH transactions totaling $87.1 billion, an average $1,161 per payment. December’s 15.2 million transactions represented a 51% increase over November, indicating widespread interest in the payment method, NACHA said.

“Financial institutions, businesses and consumers are reaping the benefits of same-day ACH,” NACHA COO Jane Larimer said. “Same-day ACH is now a reality for payroll, bill payment, business-to-business payments, account transfers and many other applications.”

The vast majority (92%) of same-day ACH debit transactions, which just launched last September, has been consumer bill payments and account-to-account debits; the rest were B2B payments, NACHA reported.

Same-day ACH credit has been available since September 2016; its use spiked 47% in the fourth quarter of 2017, NACHA added.

NACHA said 2018 will likely show even bigger growth due in part to the rollout of phase III of same-day ACH, which is set to take effect on March 16. Starting on that date, same-day ACH credits must be made available to account holders by 5 p.m. local time.

According to a NACHA survey done last November and December and released last week, 82% of financial institutions expect same-day ACH debit volume to grow “at a rapid or steady rate,” and 78% expect same-day ACH credit volume to grow “at a steady rate” over the next six to nine months.

The survey also found that 84% of member financial institutions originating same-day ACH debit said actual volume was the same or higher than anticipated; 90% of financial institutions that receive same-day ACH debits said the same.

The respondents said they haven’t seen an increase in fraud due to same-day ACH.

“Both the results to date and the forward-looking expectations reported in this survey echo NACHA’s long-held position that use of same-day ACH payments will continue to grow at a robust rate,” Larimer said. “Use cases for same-day ACH debits like bill payments and business-to-business payments demonstrate how this additional faster payment method is benefiting consumers and businesses alike.”

Additionally, 95% of the financial institutions surveyed said they have or will meet the same-day ACH requirements for phase III by the end of January 2018.

The advent of phase III in March may not be the last chapter in same-day ACH, however.

NACHA is soliciting comments on new proposals to add a third same-day ACH processing window, provide faster funds availability to receivers of same-day and non-same-day ACH credits, as well as raise the per-transaction dollar limit on same-day transactions to $100,000. The group is also exploring interest in ACH processing on weekends and holidays.

“Deferred settlement until Mondays (or Tuesdays on three-day weekends) can cause hardships for cases such as consumer payroll payments and bill payments, and accountholders might not have the best information available about their true available balances,” it said.

“Strategically, same-day ACH is a key component of NACHA’s roadmap to move the ACH Network forward for financial institutions and their customers. Feedback from financial institutions and ACH end-users already suggests that many organizations could make greater use of same-day ACH with changes to its features,” the organization noted.