According to new data from the National Automated Clearinghouse Association (NACHA), the electronic payments association that manages the development, administration, and governance of the ACH Network, same-day ACH has successfully started after it was initially implemented in September 2016. In October 2016, ACH counted for 3.8 million transactions making up 55 billion.
ACH is the US faster payments initiative aimed at accelerating settlement time for specific bank-based transactions. Special attention should be given to same-day ACH for B2B (business-to-business) payments. It is worth mentioning that B2B counted for the 2nd most popular use for ACH in October 2106. B2B payments resulted in 36% of same-day ACH volume in October 2016.
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The Fed, NACHA, and private institutions are on the lookout for ways to make the US payments system more advanced so to provide more convenience for users and not to stay behind the trade partners in the US. The Task Force formed by the Fed aimed at resolving potential solutions. NACHA and private institutions were trying to make banks meet a set of 3 same-day settlement deadlines through late 2016 into 2017.
The report by Jaime Toplin, research associate for BI Intelligence, Business Insider’s premium research service, studies the reasons why the US should have a Faster Payments system, how it should be implemented, what areas it would influence, and which parties would take advantage of the mentioned system and which ones would not.
Based on the research, the number of transactions impacted by faster payments will grow with years. The mentioned system will be beneficial for the main areas ─ P2P, B2B, C2B, and B2C payments, which made up 12% of US payments volume in 2014. These areas will grow with rapid advances.
What is more, such platform is expected to enhance third-party providers such as P2P app vendors or mobile bill pay firms. The latter providers will be given an opportunity to boost efficiency, volume, and engagement. Transactions costs associated with these providers won’t increase significantly.