Mercator Blog

Same Day ACH Credits Were Introduced Last Year and This Year, Same Day ACH Debits Take Center Stage
Date: October 3, 2017
Sarah Grotta
Director, Debit and Alternative Products Advisory Service

Same Day ACH (SDA) has been in the making for a long time. NACHA collaborated with its membership representing tens of thousands of U.S. financial institutions to forge the ground rules and procedures for same-day transactions, find a middle ground on transaction pricing and solidify a roll out calendar. Same day credit transactions were launched across all U.S. ACH processing banks in 2016, and the second act for faster ACH transactions, debit transactions, was recently launched and undoubtedly will add to ACH’s growth. This measured approach, spanning three years in total, is being taken for SDA to allow the market to adjust and react to unexpected or unplanned consequences such as often appear when new payment capabilities are introduced. Mercator Advisory Group released a research document titled Here Comes Same Day ACH last year that discusses the first phase of the SDA rollout.

As a reminder, the summary of the SDA initiative is as follows:

  • Standard ACH transactions take 1–3 days to process. The timing of the settlement of a standard ACH transaction is dependent on several factors, including:
    • The desired date the sender or originator has indicated in the ACH file when the funds should move. 
    • The day of the week that the files are sent. ACH operates Monday through Friday and observes processing holidays. 
    • The hour that an ACH file is sent. ACH is a batch-based system that collects and distributes files in accordance to a predetermined daily schedule. 

  • To provide faster processing of ACH transactions, two more time periods or windows have been made available during ACH processing days for financial institutions to exchange files.

  • The change that originators of ACH need to make to have their transactions processed within same-day time frames is to send the ACH file in a timely manner to meet an available processing window and also to include the current date in the effective date field.

  • Phase 1 of the SDA journey began on September 23, 2016, affecting the speed of credit entries.

  • Phase 2, which began on September 15, 2017, adds debit entry processing. 

  • Phase 3 will launch March 16, 2018, requiring all SDA entries to be available to receivers by 5:00 p.m. in the receiving bank’s local time.

 Mercator Advisory Group’s research report, Same-Day ACH Debit’s Debut, examines the impact that Same Day ACH (SDA) is having on the payments market.