Our bank has decided to not do Same Day Origination because all we have are a few customers who do payroll. However, we receive our ACH from a corresponding bank . I've looked at NACHA's website, EPCOR's website and the info from our corresponding bank. Every webinar I've attended only discusses FedACH, which we do not use. I've become so confused about everything I don't know what we are supposed to be doing. Can someone help please? Maybe I'm making this too hard? (We are in CST)

If you are not going to originate same-day ACH's :
Determine how you will be handling returns - Same-day ACH returns (they are optional)
Check your settlement times (10:30 and 2:45 pm ET and 4:00pm for returns)
Make sure same-day entries are posted by end of RDFI processing day.

I don't believe we will be returning same day ACH either.
So, basically all we need to do is make sure same day entries are posted by the end of our processing day? Correct?

Which leads me to another question: Our bank cuts off at 3pm and goes to next day. Anything that we run after that would be on next days work. The bank closes at 5pm. Our end of day program, which posts everything from that day, runs around 7pm. Nobody is here at 7pm. It's my understanding that the 7pm time is our end of processing day, correct? Are most banks doing their end of processing before this? Like, going ahead and implementing Phase 3s 5pm local time rule?

you use a correspondent bank for ACH, the correspondent either uses FRB or EPN as the "operator", there are no other options. FedACH is a colloquial term, they are talking ACH. if you receive or originate ACH, you need to follow the NACHA Operating Rules - regardless of how your entries get from/to you.

This is a dumb question, but I'm going to ask it anyway... What is the point of the $25,000 per transaction limit for same day ACH?

It's not a dumb question. It was considered that faster velocity of payments is expected to introduce risks that must be managed and mitigated. A per-transaction dollar limit is one way to mitigate risk. Financial institutions and businesses will also have to adjust their end-of-day balance forecasting and funding, and the dollar limit is a way to limit the impact.

Thanks for the response Doug. I was thinking it was probably a risk issue, but wasn't sure if there were other reasons. Would you see a reason to set up an alert in an AML monitoring software to trigger if that threshold was exceeded by one person per day, like a structuring alert?

The system itself will not allow a transaction of greater than $25,000. However, a customer can originate multiple $25k items per day, and receive the same - that does not mean they are doing anything illegal. There are no limitations to how many transactions a customer can send or receive, just that each one is limited to a max amount of $25k. If you choose to monitor this, be prepared to quickly make adjustments to what you are monitoring to avoid time wasting reviews.

lol that was what my opinion was, but was going to throw that idea out there to see what others thought. Deposit side was questioning if we should have an alert set up for that. Thanks for the reassurance Happy.

The overwhelming majority of ACH entries are for $25,000 or less. Sure, there are significant numbers of businesses that routinely shuffle funds between stores (concentration and disbursement, CCD) in large amounts, but the average ACH credit is around $3,250 and the average ACH debit is under $1,500. The $25,000 limit is also used as the cap on checks that can be converted to ARC, BOC and POP entries.

Thanks for sharing that info John. I was not aware of those limits either. I am not an expert in the Deposit area by any means...