Understanding Nacha's New Rules on Credit or Debit ACH: What You Need to Know

The National Automated Clearing House Association (Nacha) has recently announced new rules aimed at further clarifying the roles and responsibilities of Third-Party Senders (TPS) in the ACH Network. These changes, which will take effect on September 30, 2022, with a six-month grace period for certain aspects, aim to provide greater transparency and security in the processing of credit or debit ACH transactions.

One key aspect of these new rules is the requirement that all TPSs conduct a Risk Assessment. This means that third-party senders will need to evaluate the risks associated with their operations, including the risk of fraud, unauthorized access, and other potential threats. By doing so, TPSs can better identify and mitigate potential issues before they arise.

Another significant change is the way Nacha will address Nested Third-Party Sender relationships. A 'Nested Third-Party Sender' is defined as a third-party sender that has an agreement with another third-party sender to act on behalf of an originator, but does not have a direct agreement with the Originating Financial Institution (ODFI). This new rule will provide greater clarity on the chain of agreements and responsibilities in nested TPS arrangements.

To achieve this, Nacha's Risk Management Portal will identify all Third-Party Senders that allow Nested Third-Party Sender relationships. The two rules will be effective as of September 30, 2022, with a six-month grace period for certain aspects.

The overarching purpose of these new rules is to provide greater transparency and security in the processing of credit or debit ACH transactions by clarifying the roles and responsibilities of Third-Party Senders (TPS) in the ACH Network. By understanding these changes, originators, ODFIs, and TPSs can better navigate the complexities of the ACH network and ensure that their transactions are processed smoothly and securely.

In conclusion, Nacha's new rules on credit or debit ACH aim to provide greater clarity and security for all parties involved in the ACH Network. By conducting Risk Assessments and understanding nested TPS relationships, third-party senders can better protect themselves and their customers from potential risks and ensure a smoother transaction process.

Credit or debit ach