2022 was huge for Nacha and the overall ACH network. We saw unprecedented growth in the utilization of ACH technology and increased digitization of payments. As a Nacha-Preferred Partner, iCheckGateway.com keeps a close eye on all Nacha regulations and operating rules to ensure the highest levels of compliance.
Our marketing team keeps tabs on the Nacha blog to stay up to date with the latest in the ACH sector. Here are the top highlights that stood out to us from all the 2022 updates shared by Nacha.
Treasury Adopts Most Nacha Rules Implemented Since August 2019
On January 3, 2022, the U.S. Treasury adopted most of the Nacha operating rules set throughout 2020 and 2021. Some of these included:
- Increasing per payment maximum transaction limit for Same Day ACH to $1 million
- Implementing Meaningful Modernization changes
- Adding Limitation on Warranty Claims
- Supplementing Data Security Requirements
- Adding a Supplemental Fraud Detection Standard for WEB Debits (with a delayed effective date of March 22, 2022)
- Addressing Improper Uses of Reversals
- Differentiating Unauthorized Return Reasons (repurposing of code R11) and others
The U.S. Treasury did not adopt the ACH Contact Registry Rule that requires financial institutions to use the ACH Network to register contacts for ACH operations and fraud/risk management. However, it may consider alternative methods of making appropriate contact information available to financial institutions in the future.
Nacha Announces Advanced Fraud Solutions as a Preferred Partner for Account Validation
The need for account validation and check verification technologies has increased exponentially with the adoption of faster payment systems. The best payment processors maintain an active negative data database and use tokenization and encryption technologies along with account validation to further increase security.
Advanced Fraud Solutions joined a select group of companies recognized by Nacha for offering products and services that align with its core strategies to advance the ACH Network. Over 750 banks and credit unions trust Advanced Fraud Solutions in the U.S. to catch fraudulent deposits.
This partnership is a testament to Nacha taking severe measures to curb fraudulent transactions and identity theft on the network. iCheckGateway.com is a Nacha-Preferred Partner for ACH Solutions and Automation.
ACH Network Sees 29.1 Billion Payments in 2021, Led by Major Gains in B2B and Same-Day ACH
In Feb 2022, Nacha launched the ACH network statistics from 2021. Here are the highlights:
- The ACH Network processed 29.1 billion payments valued at $72.6 trillion in 2021, an 8.7% increase in volume from 2020
- Same-Day ACH payment volume grew nearly 74% in 2021
- The value of ACH Network payments rose 17.4%, or $10.8 trillion, in 2021
- Business-to-Business (B2B) payments increased 20.4% from 2020 to 5.3 billion payments valued at $50 trillion
- Medical and dental practices and facilities received 426.3 million healthcare claim payments electronically through the ACH Network, a 17.9% increase from 2020. These payments were valued at $2 trillion
- The ACH Network also processed 143 million economic impact payments, 182 million Advance Child Tax Credit payments, and hundreds of millions of unemployment benefits by direct deposit
Learn more about the leading ACH technology statistics from 2022 on our blog.
AFP Survey Finds Major Shift to Electronic B2B Payments
We already know that the digitization and adoption of electronic payment methods are at an all-time high after the pandemic. This fact was reconfirmed by the Association for Financial Professionals’ (AFP) 2022 Payments Cost Benchmarking Survey.
The study showed that 73% of organizations are transitioning their Business-to-Business (B2B) payments from checks to electronic payments, and the figure stood at 80% for publicly owned firms.
The main reasons cited for this transition included the following:
- Increased efficiency (92%)
- Reduced cost (85%)
- Fraud prevention (over two-thirds of respondents)
- Organizations with at least $5 billion in annual revenue adopted electronic payments to strengthen their workflow automation project (55%)
Same-Day ACH Expansion to $1 Million Begins Today
The slower speed of ACH transactions was one of the key reasons businesses and individuals preferred wire transfers or credit cards. All of this changed when Nacha introduced Same-Day ACH. This technology, coupled with a higher per-payment limit of up to $1 million, was a boon for business owners.
The higher limit created new use cases and expanded existing ones, such as vendor and supplier payments for businesses, tax payments, and payroll funding. The increase followed a year of significant growth for Same-Day ACH, in which volume and value rose 74% and 105%, respectively. Nacha reports showed over 1.5 billion Same-Day ACH payments made since its inception in September 2016 by March 2022. The higher limit will help meet market needs and support innovation.
Why a New ACH Risk Management Framework is Needed
Fraud involving credits and other push-type payments was a growing concern on the ACH Network. Nacha, the Risk Management Advisory Group (RMAG), the ACH Network Advisory Board, and other concerned parties are developing an updated risk management framework to address this issue. The new framework was an effort to tackle the problem proactively and is expected to include an industry paper and other tools later in the summer.
We covered the need and details of the New ACH Risk Management Framework on our blog in detail. Read to find out more!
Late Night ACH File Delivery for Many Begins September 12
Apart from the Same-Day ACH technology, Nacha also invested in additional resources to speed up the accurate reflection of ACH transfers.
The Federal Reserve and The Clearing House started delivering additional Automated Clearing House (ACH) files to Receiving Depository Financial Institutions (RDFIs) in the late night hours beginning September 12th and 16th, respectively. This change allowed RDFIs to more accurately show their customers what their balances will be when the next banking day begins, particularly on weekends or holidays. We answered the most important and frequently asked questions about the Additional ACH File Delivery process on our blog.
ACH Network Moves 7.6 Billion Payments in the Third Quarter of 2022; Strong Growth Continues for Same-Day ACH
By October 2022, Nacha recognized that Same-Day ACH was a massive hit amongst businesses and individuals. It released the following statistics from Q3 2022:
- The Network processed 7.6 billion payments worth $19.2 trillion in the third quarter of 2022, representing year-over-year increases of 4.2% and 6%, respectively.
- Same-Day ACH payments saw robust growth, with 176.6 million payments worth $478.5 billion made in the third quarter, representing year-over-year increases of 23.5% and 102.7%, respectively.
- Business-to-Business (B2B) ACH payments increased by 11.5% to 1.5 billion.
- Internet payments rose 10.2% to 2.4 billion
- Person-to-Person (P2P) payments increased by 15.5% to 76 million.
Same-Day ACH: Over 2 Billion Payments
Nacha celebrated the 2 billionth Same-Day ACH payment in October 2022, just 13 months after the 1.2 billionth payment was made. From its launch in September 2016 through October 2022, the ACH Network made more than $3.3 trillion worth of same-day transactions. The average daily same-day payment had also increased by 114% from $1,304 in October 2016 to $2,792 in October 2022. The growth of Same-Day ACH is partly due to the support of the payments community, including the ACH Operators, financial institutions, and payment associations.
ACH Network Prospers Through Economic Uncertainty
One of the last blogs of the year on Nacha’s website talked about the strong growth of the ACH Network in times of uncertainty.
Studies showed that the Network continued growing despite economic uncertainty in 2022, with 3.3% and 6.5% increases in the number and value of payments processed, respectively, through the end of the third quarter. The ACH Network will provide efficient, reliable, and fast payment options for consumers, businesses, governments, and nonprofits.
Learn more about Nacha and stay up to date with its latest blogs on its official website. Start processing payments for your organization with the newest payment technologies today by partnering with iCG.
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