ICBA said the definition of “banking day” is adequate and that it doesn’t support Nacha’s Automated Clearing House return efficiencies proposal.
Banking Day: In response to Nacha’s request for information on the term “banking day,” ICBA said that while the current definition of generally supports ACH processing effectively, targeted refinements, particularly with respect to procedural deadlines, could enhance flexibility without compromising system integrity.
Return Efficiencies: Regarding Nacha’s request for comment and request for information regarding ACH Return Efficiencies, including Dishonored and Contested or Corrected Return Timeframes and Return Timeframes, ICBA said community banks support efforts to improve the overall efficiency and resiliency of the ACH Network but the RFC would only provide limited incremental value, therefore ICBA does not support the proposed rule change.
Background:
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Nacha has observed that approximately 40% of RDFIs are not utilizing the available same-day return windows, which can be used without incurring a same-day fee.
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To encourage use of earlier return windows, Nacha proposed requiring select of return codes to return entries by the end of the banking day after settlement, rather than by the opening of business, moving the deadline forward by 9.5 hours, giving RDFIs less time to identify, process, and transmit these returns.
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Many of the returns codes in the proposal reflect errors originating from the ODFI due to deficiencies in data submitted by originators.
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Requiring RDFIs to return such transactions more quickly shifts the consequences of these errors to the RDFI without addressing their root cause.
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Many community banks intentionally rely on personal review for all returns as part of their customer service model, which allows institutions to ensure customers receive expected ACH credits and debits and to redirect transactions where appropriate, such as in cases involving fraud-related account closures.