ACH On Demand Enhancement

This project will enhance the popular ACH Instant Deposits feature (otherwise known as ACH On Demand) to allow the fee to be covered by the incoming deposit, rather than requiring funds to already be in one of the member’s accounts to cover the fee before the deposit is made.

It’s important to understand that we cannot actually take the fee from the incoming deposit itself. When the ACH item is received, we have no idea what that deposit is committed to before we start. And for obvious reasons, we must post a transaction that equals what we received, for tracking purposes, in case the item is disputed or needs to be returned, possible trans reversals, etc. We also want to avoid unnecessary overhead on this transaction and to keep the solution as simple as possible, keeping in mind that ACH distributions can be complex.

Therefore, we will add an optional configuration flag so that your credit union can choose whether they care about funds being available beforehand or not. If you want to ensure funds are available, then the feature will continue working the same as it does now.

If you don’t mind the fee possibly taking the account balance below available or negative, then as long as the member chooses to take the fee from the base distribution (seq 99) account (assuming that’s a savings or checking account), then the system will simply ignore the balance on the account (including freezes, secured funds, par value, etc.) and allow the item and the fee to be posted, even if the fee ends up causing that account to be posted below available or to a negative balance.

Caveats:

  • The fee is still posted as a separate transaction, after all distributions have been completed.
  • We cannot test to ensure that if there are distributions, there will actually be any funds leftover in the base account to cover the fee. So the fee might still take that account below available or to a negative balance. Your collections team will need to be aware of this scenario.
  • If the base distribution account (seq 99) is a loan (any type), to avoid problems with Reg Z fee disclosures, the member will be required to choose a different account for the fee, regardless of setting of the new config flag.
  • Likewise, if the base distribution account (seq 99) is a tax escrow, IRA savings, or certificate account, the member will be required to choose a different account for fee, regardless of setting of the new config flag.

Status as of December 2022: Project # 60108 is waiting for available programming resources.

 

Chef for this recipe:  Karen Sorensen

 

Updated
December 16, 2022

Leave a Comment

* denotes required fields
  • (will not be published)

XHTML: You can use these tags: <a href="" title=""> <abbr title=""> <acronym title=""> <b> <blockquote cite=""> <cite> <code> <del datetime=""> <em> <i> <q cite=""> <s> <strike> <strong>

Check Out the New Recipes We’re Cooking in the Kitchen!

Check Out the New Recipes We’re Cooking in the Kitchen!

Have you visited the Kitchen lately?  If not, take a look at our newest projects: Card Activity Optics Credit Card Statement Enhancements Introducing Biz Watch for ACH: ACH Controls for Business Memberships Max Earnings Sweeps for Business Members Positive Pay Cashier Services (for Inhouse Checks) RDC Enrollment via CU*BASE Summary Statements for Business Credit Cards… Read more »

Sep 29, 2020

Check Out the New Recipes We’re Cooking in the Kitchen!

Check Out the New Recipes We’re Cooking in the Kitchen!

Have you visited the Kitchen lately?  If not, take a look at our newest projects: Accounts Payable Enhancements Creating an Engine for Predictive Retailing (aka “Nostradamus”) Deposit Hold Enhancements Escrow Analysis Enhancements Expanding Screen Sizes for CU*BASE GOLD Mobile First Transaction Limits for Express Tellers Each of these recipes includes a place to provide comments,… Read more »

Jul 14, 2020