Same Day ACH Payment Processing
How it works: New capabilities of Same Day ACH (electronic payments) will become effective this upcoming September to allow financial institutions and businesses to move to a faster processing environment. Beginning September 15, 2017, Same Day ACH payment processing will be available for both credit and debit entries enabling the same-day processing of ACH payments. Members waiting for credits and vendors wanting faster payment processing can now route through quicker ACH channeling.
What is an ACH?
- Originally started as a system to replace paper checks, ACH allows businesses to receive an electronic payment directly from a buyer’s checking account and are commonly known as e-checks.
- This type of electronic fund transfer is commonly used for direct deposit payments from employers, as well as monthly payments to service providers, such as utilities.
- ACH payments are increasingly used for online payments and point-of-purchase payments, as well as B2B (business-to-business) and P2P (person-to-person) payments
Key Features: Virtually all types of ACH payments, including both credits and debits, are now eligible for same-day processing. Only international transactions (IATs) and high-value transactions above $25,000 are not offered.
For Businesses and other financial institutions, faster payment deliveries are now offered through ACH. This may be a lucrative option compared to debit card processing that will bypass card services and their interchange fee structures. Still, it is up to the originating business to want to pay for this expedited ACH delivery payment (as compared to next day settlement). Merchants especially like payment options that don’t cost too much to process.
For Consumers, when given the option compared to ACH, debit & credit card processing offers additional protections that ACH payments do not. Debit/Credit transactions run through card services (i.e. Visa/MC) that offer dispute/fraud protection & guaranteed funds up to consumer limit. PLUS, the merchant won’t have a direct access to your account….so IF given the option; we want our members account transactions to run as debit/credit.
Is Same Day ACH Unique for IAACU? No, all financial institutions are required to receive Same Day ACH payments and provide credit for same day transactions. Same Day ACH Origination is optional.
For IAACU members expecting credits – this is great news! … Better today than tomorrow…BUT debits will start to process faster as well. So, BEWARE! ACH debits will draw money from checking accounts and consumers will start seeing purchases deducted the same day thus reducing the “monetary float”.
Origination (Request to Send Funds Out) of Same Day ACH: Most financial institutions have not been early adopters due to operating system setup and unknown glitches. This is also true for IAACU; we hope to offer our members the ability to originate Same Day ACH credits in the future once the financial infrastructure and stability has been established. At this time, IAACU offers Next Day ACH origination processing. In addition, wire transfers are available for those needing same day transfers.
Receipt of Same Day ACH
IAACU Members are already receiving Same Day ACH Credits into your accounts. Credits are posted by end of business day.
For Questions, Please contact us at 1-800-676-2541 or [email protected]