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Treasurers Seek Answers from Banks on Same-Day ACH

  • By Andrew Deichler
  • Published: 6/15/2016
MINNEAPOLIS -- Corporate treasurers expressed frustration over the way their banks are preparing for same-day ACH payments Tuesday morning at the latest meeting of AFP’s Treasury Advisory Group (TAG).

One treasurer said he was “shocked” that banks generally have not been actively talking to their corporate clients about same-day ACH. “It’s coming in the fall, right? I had one bank talk to me and I had to twist their arm,” he said. “I am sure that our systems are going to have to change in terms of the way we mark an ACH payment that we want to go same-day.”

Another TAG member responded that banks likely haven’t been very proactive in this area yet because they are still ironing out their approach to same-day ACH. “I had one bank that we approached about this,” he said. “But they’re not there yet. They’re not there with pricing, and they’re not there with the debit part—how you can block somebody from being able to debit you same-day.”

An assistant treasurer responded that banks aren’t talking about it because they don’t want to lose their income from wire payments. That logic makes sense; for some treasury departments, the shift from wire to same-day ACH could be sizable. “I have 100 payments per day I could convert from wire to same-day ACH,” she said.

Of course, a mass exodus from wires to same-day ACH is unlikely, given the $25,000 limit NACHA has set for transactions. While many treasurers expect NACHA to eventually raise that ceiling, for the moment, transaction size will determine how much they use same-day ACH. Once that ceiling is raised, however, then there could be quite a shift, given how much a company could save using ACH versus wire.

One treasurer at TAG had a solution for the time being—just make a lot of same-day ACH payments. “You’d probably get a call from your accounting department asking, ‘Why did you make 228 payments of $24,999?’” he joked.

Update: 6/15/16

During a session on the second day of the TAG meeting, Claudia Swenseid, senior vice president of the Federal Reserve Bank of Minneapolis, asked treasurers in attendance what use cases they think they’ll have for same-day ACH. Members responded that they would likely use it for payroll and possibly some worker’s compensation claims. It also could be useful for B2P payments, for example insurance companies that need to pay out claims to plan members.

But generally, the group agreed that the $25,000 cap will keep treasurers from using same-day ACH for a lot of key payments. A banker in attendance said he has seen “very limited interest” from corporate treasurers due to the cap.

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