Stay up-to-date and compliant by regularly reviewing the National Automated Clearing House Association’s (NACHA) Rules and Guidelines for ACH transactions. If you haven’t done so already, you will need to create a user profile before you can log in. Once you review the rules, please make note of some specific guidelines to keep in mind:
- All effective dates, within files sent to F&M Bank, must be at least one (1) banking day following the date the file was sent.
- Written authorizations are required for all Pre-Arranged Payment and Deposit (PPD) and Cash Concentration or Disbursements (CCD) debits.
Notifications of Change
A Notification of Change is a Zero Dollar item that is sent by the Receiving Depository Financial Institution (RDFI). This indicates the item was accepted by the receiving bank and sent back a change request of the error in the transaction. The error must be addressed within six (6) banking days of receipt or prior to initiating another Entry to the Receiver’s account. The item should not be re-submitted until the proper corrections have been made. This is pursuant to NACHA Operating Rules, Section 2.11, Subsection 2.11.1.
Notification of Change Code Reference Guide:
C01- Incorrect DFI Account Number
C02- Incorrect Routing Number
C03- Incorrect Routing Number and Incorrect DFI Account Number
C05- Incorrect Transaction Code
C06- Incorrect DFI Account Number and Incorrect Transaction Code
ACH Origination Returns Code Reference Guide:
R01 - Insufficient Funds - Such entries may only be reinitiated up to two times within 180 days from the Settlement date following the return of the original entry. In addition, reinitiated items must contain the phrase “RETRY PYMT” in the Company Entry Description Field.
R02 - Account Closed
R07 - Authorization Revoked by Customer - No other transaction should be initiated unless a new authorization is obtained.
R08 - Payment Stopped - Re-initiation of an entry has to be authorized by the Receiver before processing another Entry.
R10 - Customer Advised Not Authorized, Improper, Ineligible or Part of an Incomplete Transaction - No other transaction should be initiated unless a new authorization is obtained.
R11 - Customer Advises Entry Not in Accordance with the Terms of the Authorization - It can be used by the RDFI to return an entry for which the Originator and Receiver have a relationship, and an authorization to debit exists, but there is an error or defect in the payment such that the entry does not conform to the terms of the authorization.
Same Day ACH:
- Allows clients to process and send Same Day ACH transactions prior to 12:00pm current day that will post the same business day.
- Allows clients to process and send ACH transactions after 3:00pm that will post next day prior to end of day.
- Allows clients to send and receive both Credits and Debits up to $100,000 per transaction*
*Based on clients approved limits
To protect your business, ensure all employees handling payments for your business always:
- Contact the vendor or client directly to confirm any requests for payment method changes and to validate that the changes are legitimate before processing.
- Validate any new payment instructions received via email - even if the email is internal.
- Pick up the phone, whenever possible, and speak directly with the individual requesting a funds transfer.
- Carefully review all payments before they are sent.
- Ensure all correspondence is validated and documented in a unified way across your business.
- Contact the vendor or client via the phone number that you have on record and NOT the phone number listed in the email.
Account activity review
Businesses are required to review incoming account activity on a daily basis to monitor for unauthorized transactions. Businesses have limited timeframes to return certain ACH transactions.
If you have any questions regarding the NACHA Rules and Guidelines, please call F&M Bank’s ACH Department at (562) 344-2001, Monday-Friday 8:00AM to 5:00PM PT, or email us ACHSupport@fmb.com