Same Day ACH Credits

Same Day ACH Credits

Consumers and businesses are used to getting what they want when they want it. Your groceries get delivered the same-day and you can summon an Uber in minutes. Payments, however, still tend to take a while.

Even in 2016, the quickest way to get your money from one bank to the other is to withdraw the cash and walk across the street. This is because major banks synchronous their accounts with the Automated Clearing House (ACH) network only once a day. This meant that payments would take at least a day or two to be completed.

This system is known as Classic ACH and it’s been around since the 1970’s.  Thankfully the network is now getting a much needed upgrade.

Say Hello to Same-Day ACH

The upgrade is pretty simple. The National Automated Clearing House Association (NACHA) has pushed banks to start synchronizing accounts with the ACH network three times a day. Because the accounts are synchronized and updated more often, same-day payments are now possible. American workers and businesses can now get their hard-earned money much faster.

The American payments system has lagged behind other countries. Mexico, the UK, Sweden, and Singapore are all adopting same-day payment systems. Even India has leapfrogged most developed countries and installed a quicker payment network for businesses and consumers.

These countries have successfully adopted real-time or same-day payments because their central banks have responded to the demand for such a system from businesses and consumers.  In the US, the Federal Reserve is in the process of modernizing the payment system. Upgrading ACH to same-day is part of this plan to catch up with the rest of the world.

A Deloitte report found that there were a number of reasons for this push to faster payments. The regulatory landscape is ideal, technology has developed enough to support such a system, consumers prefer the convenience and merchants see the value in a quicker service such as this.

But payment systems like these are vast, complex and highly technical. This means it is easier to build a system from scratch (the way India has done) than to renovate or upgrade an existing system. This is why the US system has taken so long to catch up. But now the upgrade is complete. A new NACHA rule compels ACH-capable financial firms to accept ach payments starting September 23, 2016. This means companies and individuals can now have their credits completed in a day. The system for ach payments debits will be expanded in late-2017. The whole upgrade is divided in 3 stages, which will all be completed in 2018.

What Does Same Day ACH Credits Mean to You?

Considering the system upgrade is so recent, there’s a lot of unknowns for businesses across the country. There are some clear advantages for the whole economy with faster ACH payments.

ACH is the most ubiquitous payments network in the country. The system is used by every bank and credit union in the country. This makes it convenient for customers and businesses to use the network for faster ach payments. So far, only private networks developed by card companies (Mastercard and Visa) have offered quick payments, but these also tend to be expensive.

Credit card transactions can cost up to 2% of the transaction and debit cards can cost close to 1%, the ach payment system charges a flat fee between 10 and 50 cents depending on volume.

Cheaper and faster payments on a wide-spread network like ACH has the potential to help a lot of businesses.

  • Payments are automated, which leaves less room for human error
  • Flat fee helps businesses preserve their profit margins
  • Quicker payments to employees, suppliers, affiliates, and vendors helps you obtain & maintain a competitive edge.

Same Day ACH Debits Coming in 2017

Same-day ach payments are not live for debits just yet. Debits will be available in September 2017. Businesses are expected to adopt ach at a faster pace by then. Customers are already more willing to spend money with a business which is part of such a trusted network. The payment network reduces the risks of fraud and chargebacks and is clearly more convenient than other traditional payment methods.  Attractive benefits like these have convinced many businesses to sign up for ACH merchant account and accept ACH payments.


A recent survey by NACHA found that 79% of consumers and 82% of workers had either received or heard of ACH payments. A majority of these people were happy with the service, thought it was quick and considered it highly secure. The survey and accompanying white paper showed that ACH was ingrained in the national consciousness and this made it the best system for businesses to use.

Now, with same-day ACH payments, the system for credits is faster and better than ever.  The network is now live and you can get start processing same day ACH credits immediately.  can start getting involved in same-day ACH payments and credits right away. The rates for this quicker services are yet to be determined by banks, but payment processors may be able to offer better rates.

Could your business benefit with same-day ACH payments?

Contact us to find out.

Same Day ACH

Same day ACH is now a reality for initiating credits.  For debits, same day ACH will be available next year.

 ACH is a form of Electronic Funds Transfer or EFT.  Each time you pay or receive salaries and wages, make direct deposits, pay for utilities or conduct any other transaction, the funds move through the ACH network.

The National Automated Clearing House Association or NACHA is the organization that regulates the activities of the ACH. It has initiated a new and innovative additional network functionality to streamline and speed up the fund transfers.

This approach is termed as Same Day ACH. Here’s how it works.

 Same Day ACH Windows

Prior to same day credits processed through the ACH network, recipients had to wait at least a day, and often more, to receive the funds.

The new Same Day ACH system which went into effect in September 2016 offers users, banks, and financial institutions the facility of two additional windows for processing credit transactions:

  • The morning window that ends at 10:30 AM ET, with all transactions getting cleared at 1:00 PM
  • The afternoon window that ends at 2:45 PM ET, with all transactions getting cleared at 5:00 PM

These windows make it possible for the speedier movement of funds between accounts. As long as payments are made within the specified time frames, credit transactions are processed the same day they are initiated. In this way, recipients of funds can access the money by the end of the business day.

Conditions for Same Day ACH

To make use of this facility, banks and financial institutions must comply with certain conditions.

  • International transactions are not eligible for Same Day ACH
  • Transactions of value above $25,000 cannot qualify for Same Day ACH
  • A Same Day ACH fee of 5.2 cents per transaction is applicable on the transaction. This fee can help RDFIs recover some of the costs they’ll incur for providing the facility and is paid by the ODFI or bank initiating the Same Day ACH transfer.  

Remember, though, your rates for same day ACH will be higher than the base fee charged to the banks.

Conclusion:  Benefits of Same Day ACH

Businesses, individual consumers, banks, and other financial institutions will find that the Same Day ACH is highly advantageous in many ways.

  • Quick exchange of business to business payments and information
  • Consumers can pay bills even on due dates without incurring penalties for late payments
  • Consumers can instantly move funds between the various accounts they hold
  • Companies can pay hourly wages to their workers and if needed, make emergency payroll payments
  • Employees can have fast access to their salaries and wages
  • Receiving businesses collect payments faster and thus, improve their cash flow processes
  • Goods and services can be bought and sold faster because of the availability of instant finance
  • More economical system for expedited payments and receipts as compared to other options for collecting and receiving funds
  • Consumers can receive payments quickly in times of emergency situations
  • Customers can make quick decisions and take action when managing their finances and investments.

How can your business benefit from Same Day ACH?



In the Money Lending Business- Here’s What You Need To Know About Online Payments

Money lenders and loan servicing companies operate in trickiest part of the financial industry.  Not everyone can handle the higher risks and volumes associated with a lending business.

Whether you offer car title loans or payday loans, you probably deal with a lot of regulation and inherent risk. To survive in the industry, your operations need be streamlined and completely efficient.

The best place to start is with the infrastructure that allows your customers to pay you. Studies show that traditional forms of payment are on their way out. Plastic is simply more convenient than paying with cash. And paying online, directly from your bank account, is even easier than paying with a card.

Convenience is Key

Loan service companies and loan providers face pressure from both sides – government regulations and customer defaults.

The local authorities and regulators are tightening the rules around lending, which puts pressure on loan companies.

Meanwhile, a study in Texas found that over the course of a year, more than 54% of borrowers defaulted on their payday loans. A similar study in North Dakota found that 46% of borrowers had defaulted on their loans after 48 months. Here are the findings from that study:

  • To deal with this problem, loan companies must innovate and offer convenient solutions to help encourage payments from customers.
  • Moving payments online has the dual benefit of allowing loan companies to get access to bank accounts and making it easier for customers to payback their loans.
  • The most convenient platform for online lenders and loan companies is Automated Clearing House or ACH.

ACH Payments

The reason ACH payments are so popular with loan companies is because it offers unparalleled convenience for both borrowers and lenders. ACH payments platforms allow the lender to automatically draw out the amount owed on a daily, weekly or monthly basis.

Borrowers who sign up for the service can have their dues paid automatically over the period of the loan. A writer for the New York Times found that this system of ACH payments encouraged borrowers to be more disciplined. Borrowers are put under pressure to manage their finance more carefully so that they can have enough money in the account to meet their living expenses and the automatic withdrawals from loan providers.

The infrastructure around ACH payments is designed for high volumes and regular payments. Some providers even offer services to let lenders get paid by checks over the phone, mail or fax, using a virtual terminal.

Convenience isn’t the only reason ach payments are better for loan providers. The payment platform is massive and the network handles close to 90% of all electronic payments in the United States. The ACH network is also considered to be among the safest and most secure electronic funds transfers system in the world.  

A study by SAP found that automated payments through echecks are less prone to errors and fraud, since there is minimal human interference in the whole process.


ACH payments reduce costs, assure that payments are made on time, stablize revenue from recurring payments, and are safe & secure. This makes it the ideal payment solution for lenders and loan companies across the country.

Securing payments and offering convenience to customers will do more than just help your business survive.  It will help your business thrive. 

How are you accepting payments from your borrowers?

Contact us today

ACH Trumps Cards for Recurring Billing

Protect Cash Flow with Echecks

Encouraging your customers to use ACH for recurring payments stabilizes cash flow, saves money, and increases the long-term value of your customers to your business.  

Recurring Billing Business Opportunity

Traditionally, ACH merchant accounts have been used for collecting payments for monthly bills such as utilities, car notes, insurance and mortgages,  

Within the last 10 years, however, the growth of recurring billing has soared.  

Software & computer services have moved to a recurring billing models with software as a service (SaaS) and easy payments for equipment. Entertainment sites offer video streaming, music, games.  Phone companies, always a recurring billing model, now offer apps that are paid for monthly.

Giving your customers the ability to pay for your goods & services on an recurring basis is simply smart business.  Easy payment plans are convenient for buyers.  And recurring billing is well-ingrained in the buying habits of most Americans.  

Recurring Billing as Part of Your Business Model

Ventana Research released in early 2015 their benchmark study about recurring billing which sheds light on why companies choose to implement this feature and what challenges arise while it is being used.

When asked to state the reasons for using recurring billing, the most common answers picked by those included in the survey were to:

  • Increase revenue (51%)
  • improve customer satisfaction (51%)
  • Increase customer loyalty (46%)
  • Expand into new markets (44%)
  • Improve customer satisfaction scores (41%)

The respondents were also asked to choose the most difficult challenges that come along with the use of recurring billing. The results revealed their most common concerns:

  • Customer engagement throughout life cycle (55%)
  • Cross-selling and up-selling (46%)
  • Customer retention (39%)
  • Creating new accounts (34%)
  • Invoicing (33%)

Most of these concerns can be overcome or entirely eliminated through various techniques, which will enable you to take advantage of the full potential of recurring billing.

Overall, the conclusion of the study was that the success of recurring payments is quite certain as long as sales, billing, and customer support functions align with the billing model.

ACH Payments Are Perfect for Recurring Billing

The recurring billing feature offered by ACH payments is one of the key components in stabilizing your cash flow.  

Information necessary for ACH transactions is far more stable than credit card information, making it the preferred method of payments for recurring billing.  Once ACH payments begin, there is seldom any change in billing information since people rarely change bank accounts.  Leading to fewer instances in which the payment cannot be processed due to expired information.

Compare this to card transactions.

Cards expire.  They get lost or stolen.  Data breaches mean cards must be reissued.  Requiring you to obtain new billing information from your customers.

Updating payment data is a big project for your customer service staff.   Which can result in customer dissatisfaction if services have to be terminated due to lack of current billing information.  Plus, asking for updated billing info gives your customers an unnecessary reason to cancel.  


Recurring ACH payments stabilize cash flow, decrease expenses, and increases customer satisfaction.   “Set it and forget it” recurring billing keeps the money flowing in.

Interested in an echeck account to protect cash flow from recurring billing?   

Contact today


What is ACH Payment Processing?

What Is ACH?

An ACH merchant account is an excellent alternative to card payments, allowing you to capture sales from customers that do not have cards, are maxed out on cards, or simply prefer to pay with an electronic bank transfer.  

ACH rates are also often significantly lower than rates for processing cards.  Which results in savings on payment processing costs while helping reduce fraud & chargebacks.  

The Automated Clearing House Network (ACH Network) provides the framework necessary for the processing of ACH payments, a type of transaction that is increasingly popular across the United States.  ACH electronically debits money from your customers’ bank account and automatically credits the funds to your business bank account.  

History of ACH 

Looking at the history of the National Automated Clearing House Association (NACHA), one immediately sees a continuous drive for innovation and expansion. The foundations of the network were set in 1974 when several ACH associations formed NACHA, and only four years later, as additional rules and regulations were put into place, it became possible for any two financial institutions across the United States to process this type of payment.

Over the next three decades, the institutional framework of NACHA was further developed, an evolution that paved the way to the implementation of internet and telephone-initiated payments (2001) and international payments (2009). The network now has the capacity to process both one-time and recurring transactions.

Simple Way to Collect Payments

The mechanism behind ACH payment relies on the exchange between an Originating Depository Financial Institution (ODFI), which can be either an individual, corporation, or some other entity, and a Receiving Depository Financial Institution (RDFI). The ODFI will enter an ACH entry according to instructions, and an entire batch of such transactions will be submitted at specific intervals to an ACH Operator. The last step is carried out by the ACH Operator that will assign the transactions to the appropriate RDFI.

ACH Shapes the Future of Payments

By the late 80s, the ACH network processed around 1 billion transactions on a yearly basis. The constant expansion of the network and growing popularity of the payment method made possible the processing of 22 billion transactions in 2013 alone.  NACHA publishes detailed statistics for each quarter that show the upward trend of the ACH volume overall and for specific segments. The most pronounced growth for 2014 were registered, among others, by web transactions and recurring payments. Today, the ACH network processes around 20% of the entire electronic transactions volume in the United States.

The future of ACH payments is more promising than ever. NACHA has been preparing assiduously for the gradual introduction of Same-Day ACH – a feature which will considerably decrease the settlement time of ACH payments. All parties involved, including websites that sell online, will benefit immediately from the introduction of Same-Day ACH by having the opportunity to access funds and make the delivery of their products and services faster. Since expediency is paramount in the online ecommerce industry, there has never been a better time for implementing ACH payments on your website.


ACH payment processing is a cost effective method to send and receive payments.  Benefits include:

  • Increased sales.  The more way customers can pay you, the more more money you make.  
  • Lower processing fees.  ACH processing rates are significantly lower than card payments fees.
  • Easy and simple way to send and receive money safely.

Interested in finding out more about ACH payments?  

Contact today

ACH Payments Unauthorized Returns

What is an ACH Unauthorized Return?

An unauthorized return for an ACH payment occurs when the originating depository financial institution asks for the amount  debited from the bank account of the buyer to be returned to the account from which it was withdrawn.

In most situations, the return is initiated when an account holder submits a signed statement (some banks require affidavits) to their bank in which they claim that the transaction is not authorized.

Unauthorized returns have a financial impact on your business.  Therefore, understanding and controlling them is important to protect your cash flow from your payment processing accounts.  

Most Common Unauthorized Return Codes

There are a variety of reason codes for unauthorized returns.  However, you’ll find that most of your unauthorized returns in your ACH merchant account fall under the following four return codes.    

  • R05 – Unauthorized Debit to Consumer Account Using Corporate SEC Code – this return occurs when an unauthorized transaction is submitted as if a business checking account was involved. The distinction between personal and business checking accounts is essential, as a business will have only 3 days to dispute the transaction, while a consumer will be able to do so in 60 days.
  • R07 – Authorization revoked by Customer – this reason code is assigned to a dispute when a payment was processed in spite of the fact that the account holder revoked it. This occurs most frequently for recurring billing.
  • R10 – Customer advises Unauthorized, Improper, Ineligible or part of an Incomplete Transaction – this type of unauthorized return can be filed with the financial institution in up to 60 days after the date of the transaction and it means that the account holder considers the payment fraudulent or incorrect.
  • R29 – Corporate Customer advises not authorized – This reason code is applied only when a business account is involved. It means that the account owner did not authorize the transaction or the ACH payment option is not enabled on the account.

Keeping a Low Unauthorized Return Rate

The unauthorized return rules were subject to considerable revision in September of 2015. One of the most important changes introduced a new unauthorized rate threshold that was decreased from 1% to 0.5%. Keeping a low unauthorized return rate should be a priority for any merchant that uses ACH payments because going over the maximum threshold of 0.5% can come along with risk evaluations and penalties.

Paying close attention to unauthorized returns and handling them as soon as they happen is a best business practice that should turn into a habit.  

If an unauthorized claim occurs, make sure you cancel the recurring billing feature on the customer’s account and contact them as soon as possible to understand the reasons behind the dispute. Since such claims are not always settled in favor of the merchant, providing another payment method to the customer who made the claim might reduce the risk of losing money for services and products that have already been delivered.


Recent changes in the ACH network rules regarding unauthorized returns make it challenging for all merchants, but particularly those classified as “high risk” to maintain ACH processing accounts.  As a result,  merchants in high risk categories and well as those classified as standard risk are using other technologies to process echecks outside of the ACH network.  

How is your business handling unauthorized returns within your ACH payment processing accounts?

Contact info@NationalACH today.