ACH Contact Registration - Homepage | Nacha · 2020. 9. 19. · ACH Contact Registration Request...

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© 2019 Nacha. All rights reserved. No part of this material may be used without the

prior written permission of Nacha. This material is not intended to provide any

warranties or legal advice and is intended for educational purposes only.

ACH Contact RegistrationRequest for Comment

Issue date: July 12, 2019

Responses due by: August 23, 2019

© 2019 NACHA. All rights reserved. No part of this material may be used without the prior written

permission of NACHA. This material is not intended to provide any warranties or legal advice and is

intended for educational purposes only.

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ACH Contact Registration – RFC Executive Summary

• Nacha is issuing this Request for Comment to obtain industry feedback on a proposal

to create an industry resource for financial institutions to be able to more easily connect

with other financial institutions about ACH operations, exceptions and risk management

• All financial institutions participating in the ACH Network would register contact

information with Nacha for personnel or departments responsible for ACH operations

and fraud/risk management

• Nacha would make a registry of financial institution contacts available to financial

institutions to use in addressing and resolving ACH operations and risk management

situations

• Responses are requested by August 23, 2019• Please visit NACHA’s web site at https://www.nacha.org/rules/proposed to submit comments

https://www.nacha.org/rules/proposed

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ACH Contact Registration - Rationale

• In today’s environment, financial institutions of all types and sizes seek ways to contact and communicate quickly with other FIs about specific ACH payments and exceptions; error, fraud and risk events; and the recovery of funds

• A common pain point for ODFIs and RDFIs is the difficulty in contacting the appropriate counterparties at other ODFIs and RDFIs

• Determining who to contact• Determining how to make contact

• In many situations, time is of the essence• System outages• Fraud alerts and recovery• Erroneous transactions, duplicates and reversals

• FIs commonly reach out to their Payments Association, ACH Operator, Nacha or others looking for help in locating a contact

• A comprehensive ACH contact registry can address many of the pain points of locating and communicating with the proper contact and contact method at a counterparty financial institution

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ACH Contact Registration – Nacha’s Current Service

• NACHA currently provides an Emergency Financial Institution Contact Database on a

voluntary basis• Access is provided via the Risk Management Portal

• As of the end of June 2019, 1,154 FIs have entered 3,253 contacts• An additional 586 FIs have enrolled but provided no contact information

• While Nacha continues to encourage adoption and use of this existing resource, registration

growth has slowed after the initial launch of the Risk Management Portal

• Contact information in this database frequently become outdated

• Access to contact information is limited to other FIs that have already provided contacts

• Currently, the voluntary service has not resulted in a Network-wide resource that

provides significant value to users

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ACH Contact Registration – Intended Benefits

• An ACH Contact Registry of all financial institutions is intended to be a substantially

higher-value industry resource for all financial institutions in addressing and resolving

ACH exceptions, operational issues, and risk or fraud situations

• Payment Associations would be better able to assist their FI members

• Nacha would have more complete contact information in the event of ACH Network risk

or fraud events

• Potential use cases for an ACH Contact Registry include• An ODFI needs to contact an RDFI about an ACH credit that is suspected to be fraudulent

• An RDFI needs to contact an ODFI regarding the authorization of a ACH debit

• An ODFI needs to contact an RDFI about a duplicate ACH payment or notify the RDFI of a

reversal

• An ODFI and RDFI need to execute a letter of indemnity

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• All ACH financial institutions would register contact information for ACH operations

and risk/fraud

• The contact information would be available for other registered ACH participating

financial institutions, Payments Associations, and Nacha• For use in ACH-related system outages, erroneous payments, duplicates, reversals,

fraudulent payments, etc., or potentially other uses within scope (e.g., proper contact for

letters of indemnity)

• Use of the information would be limited to these purposes

• Registration information would be required to be updated within 45 days after any

change, and verified on an annual basis

ACH Contact Registration - Proposal Overview

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ACH Contact Registration - Proposal Details

• A Participating DFI would register specific contact information for personnel or

departments responsible for:• ACH operations; and

• Fraud and/or risk management

• An FI may register contacts for additional personnel or departments, at its discretion

• A Participating DFI would register either:• The name, title, email address, and phone number for at least one primary and one

secondary contact person; or

• Department contact information that includes an email address and a working telephone

number• For department contacts, phone numbers and email addresses must be those that are monitored

and answered during normal business hours for financial institution inquiries

• Use of department contacts could enable financial institutions to better route inquiries internally

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ACH Contact Registration - Proposal Details

• To keep registration information up-to-date, an FI would• Update the registration information within 45 days following any change to the

information previously provided; and

• Verify all registration information at least annually

• These timeframe are intended to accommodate FIs that want to establish routines

for keeping information updates• The 45-day period would accommodate a monthly update routine

• The annual verification can be aligned with or incorporated into the annual Rules

Compliance Audit

• Nacha will make registered contact information available via secure means

only to other registered Participating DFIs and Payment Associations

• FIs accessing registered contact information would agree that such information

will be used only for the purposes stated in the Rule

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ACH Contact Registration – Impacts

• Currently, all ODFIs are required to register with Nacha both their Direct Access status, and their Third-Party Sender status

• Under this proposal, ODFIs also would be required to add an additional registration category to provide their own contact information for ACH operations and risk/fraud, and keep that information up-to-date

• ODFIs might have to implement procedures to keep contact information up-to-date

• Currently, financial institutions that are only RDFIs are not required to register information with Nacha, but voluntarily can enroll through the Risk Management Portal for the optional Emergency Financial Institution Contact Database and the Terminated Originator Database

• Under this proposal, all RDFIs would be required to register contact information with Nacha, and keep that information up-to-date

• RDFIs would have to implement procedures to keep contact information up-to-date• Annual verification could be performed in conjunction with the annual Rules compliance

audit

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ACH Contact Registration – Impacts (cont.)

• Financial institutions could decide to establish department contact information for

purposes of registration, and establish procedures for how to route inquiries internally

• All financial institutions would need to consider and address the circumstances under

which they would use the registry, and how they would handle and respond to contacts

and inquiries they receive

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ACH Contact Registration – An Industry Resource

• Nacha would provide this registry resource as a tool for inter-FI communication for issues

relating to ACH operations and fraud/risk management• The registry would be accessed via the existing Risk Management Portal

• Authorized users would use the secure Portal to access registered contact information

• There would not be a charge to FIs to register or use the contact information

• Risk Management Portal security• The Portal is a hosted solution built with security and business continuity in mind, including

physical security, encryption, user authorization and authentication processes, and auditing to

verify satisfaction of privacy and security requirements

• Data is encrypted while in transit to Nacha and remains encrypted while it is at rest

• Compliance of the underlying cloud platform with key industry standards is certified by the

cloud service provider

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ACH Contact Registration – Survey and Request for Comment

Via this Request for Comment, Nacha is seeking industry feedback on the ACH Contact

Registration proposal. Questions include• How often do financial institutions seek out contact information for other FIs about ACH

payments, and how easy or difficult is it to obtain correct contact information?

• What are the “use cases” of an ACH contact registry? What are the use cases for which time

is of the essence?

• Who should register – e.g., which departments? Should registration be of individual personnel

and/or department contacts?

• What information should be included in the registration?

• What methods would financial institutions use to input and retrieve the data?

• Manual entry and look-up; file uploads; API calls for input and retrieval

• What is the best way and appropriate timeframe to keep registered contact information up-to-

date?

• Should contact information for ACH Sending Points and Receiving Points be included?

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ACH Contact Registration – Proposed Effective Date

• Proposed effective date - July 1, 2020• This is the date on which Nacha intends the registration portal to be available for

Participating DFIs to begin to submit contact information

• Proposed registration deadline - October 30, 2020• This is the date by which a Participating DFI must have completed its registration

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Same Day ACH Quality and Risk

Sept 20, 2019 Faster funds availability

March 20, 2020 Dollar limit increase

April 1, 2020 Differentiating Unauthorized Return Reasons – New

R11 use becomes effective

June 30, 2020 Account Information Security Requirements (annual

ACH volume greater than 6 million)

July 1, 2020

(proposed)

ACH Contact Registration open

Oct 30, 2020

(proposed)

ACH Contact Registration deadline

March 19, 2021 Same Day ACH Third Window Commercially Reasonable Fraud Detection for WEB

debits

April 1, 2021 Differentiating Unauthorized Return Reasons – R11

covered by Unauthorized Entry Fee

June 30, 2021 Account Information Security Requirements (annual

ACH volume greater than 2 million)

This chart shows how the proposed effective dates for this ACH Contact Registry proposal relate to other upcoming effective dates

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ACH Contact Registration - Homepage | Nacha · 2020. 9. 19. · ACH Contact Registration Request...

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