2021 updates to NACHA Operating Rules

Being in the know and up to date on fraud prevention guidelines and security requirements can help protect your business. We want to be sure you have the latest ACH rules established by the National Automated Clearing House Association (NACHA) to help you ensure efficient, secure ACH payment processing.

Supplementing data security requirements

Effective June 30, 2021

This rule requires ACH originators to protect account information for receivers by rendering it unreadable when it is stored electronically.  This applies to ACH originators who have an origination volume of 6 million transactions annually across all financial institutions.

How does this impact you?

It is best practice to store all account information for receivers as unreadable, regardless of how many transactions you process annually. Effective June 30, 2021, this is a requirement for ACH originators who originate 6 million transactions or more annually. On June 30 2022, this will rule will be required for originators who originated 2 million transactions annually across all financial institutions.

Reminder on reversal requirements

As a reminder, an ACH Originator can process a reversing transaction to correct an erroneous transaction previously initiated to a receiver’s account within 5 banking days.  As an originator of ACH transactions, you may reverse an entry made in error if:

1. The entry is a duplicate entry
2. The entry was intended for an entirely different recipient
3. The amount was different than intended
4. A consumer-receiving (PPD) credit entry was issued for payment of services and the value of the entry is included in a check that was delivered to the same receiver upon separation of employment and the entry was transmitted prior to the delivery of the check to the receiver
5. The effective entry date is for the wrong date*
   1. A debit entry is for a date earlier than intended or authorized by the receiver
   2. A credit entry is for a date later than intended by the originator

Per NACHA Operating Rules, the originator must make a reasonable attempt to notify the receiver of the reversing entry of the reversal and the reason prior to the settlement day of the reversing entry. The reversing entry must be transmitted to or made available to the RDFI within five banking days of the erroneous entry.

Expansion on reversal rules

Effective June 30, 2021

An additional permissible reason for a reversal entry will be added beginning on June 30, 2021. On this date, you can begin submitting a reversal due to a wrong effective date:

1. Reverse a debit entry that was for a date earlier than intended or authorized by the receiver
2. A credit entry that was for a date later than intended.

How does this impact you?

Review your current reversal process to ensure NACHA Operating Rules are being followed for all reversals.

*Effective June 30, 2021