DRAFT REQUEST FOR COMMENT - NACHA



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Meaningful Modernization

Request for Comment

ACH Participant Survey

February 18, 2020

Comments Due by April 3, 2020

Nacha requests input on a group of proposals that would facilitate the use of new technologies and channels for ACH authorization and initiation, provide flexibility and increase consistency across authorizations and SEC Codes, and reduce administrative burdens. In addition, questions are provided to explore dispute resolution rights for Originators of consumer ACH debits. Comments are due by Friday, April 3, 2020.

The survey should be completed online at by April 3, 2020. For convenience, the survey questions are also provided within this document to assist respondents in gathering information from within their organizations.

Nacha Staff Contacts

Administrative questions: Maribel Bondoc, Manager, Network Rules

Fax (703) 787-0996

E-mail: mbondoc@

Questions: Cari Conahan, AAP, Senior Director, ACH Network Rules & Enforcement

E-mail: cconahan@

Section 1 - Respondent Information

All Respondents

|Name | |

|Title | |

|Organization | |

|City, State | |

|Phone: | |Email: | |

|Please indicate your organization’s role(s) in the ACH Network: |

| |ODFI | |Payments Association |

| |RDFI | |Nacha Direct FI Member |

| |ACH Operator | |Government |

| |Non-FI end-user | |Third Party Service Provider |

| |Industry association | |Software/Technology provider |

| |Other: |

|What areas of your organization provided input for the responses to this survey? |

| |Operations | |Retail/online banking |

| |Product management | |Customer service |

| |Legal | |Compliance |

| |Information Technology/software | |Wholesale/corporate banking/treasury mgt |

| |Executive/strategy | | |

| |Other: |

Financial Institution Respondents

|Asset Size | |less than $500 million |

| | |$500 million - $5 billion |

| | |$5 billion - $25 billion |

| | |$25 billion - $100 billion |

| | |Greater than $100 billion |

Section 2 – Overall Proposal

|Overall, does your organization support the concepts included in this Request for Comment? | |Yes |

| | |No |

| | |Don’t know |

|In general, does your organization believe these proposed changes will reduce barriers to the use| |Yes |

|of ACH? | | |

| | |No |

| | |Don’t know |

|Does your organization believe these proposed changes will have a net positive or net negative | |Positive impact |

|impact on the ACH Network? | | |

| | |Neutral |

| | |Negative impact |

| | |Don’t know |

|Does your organization believe these proposed changes will have a net positive or net negative | |Positive impact |

|impact on your organization? | | |

| | |Neutral |

| | |Negative impact |

| | |Don’t know |

Section 3 – Standing Authorizations

|Does the proposal to define and enable a Standing Authorization address a barrier to using ACH? | |Yes |

| | |No |

| | |Don’t know |

|Does your organization support the proposal to define and enable a Standing Authorization address| |Yes |

|a barrier to using ACH? | | |

| | |No |

| | |Don’t know |

|As an ACH Originator, do you think your organization would make use of Standing Authorizations? | |Yes |

| | |No |

| | |Don’t know |

| | |Not an Originator |

|If yes, please provide an example(s): |

| |

|Would your organization need to be able to identify a Subsequent Entry in some manner? | |Yes |

| | |No |

| | |Don’t know |

|As an ACH Originator, does the choice of SEC Code for consumer debits ever present difficulties? | |Yes |

| | |No |

| | |Don’t know |

| | |Not an Originator |

|It yes, please describe: |

|Does your organization support the proposed flexibility in using the TEL and WEB SEC Codes for | |Yes |

|Subsequent Entries.? | | |

| | |No |

| | |Don’t know |

|As an RDFI, is it important to know if debit was part of a Standing Authorization? | |Yes |

| | |No |

| | |Don’t know |

| | |Not an RDFI |

|If yes, please explain why: |

|As an RDFI, would the proposed flexibility in using the TEL and WEB SEC Codes for Subsequent | |Yes |

|Entries present any challenges? | | |

| | |No |

| | |Don’t know |

| | |Not an RDFI |

|If yes, please explain why: |

|Please provide any additional comments on Standing Authorizations: |

| |

Section 4 – Oral Authorizations

|As an Originator, does your organization currently obtain authorizations via oral methods? | |Yes |

| | |No |

| | |Don’t know |

| | |Not an Originator |

|If yes, what methods are used? | |Telephone Call |

| | |Through online channel that is |

| | |not a telephone call |

| | |Virtual assistant |

| | |Other |

|If other, please explain: |

|Is the current limit on oral authorizations to TEL entries a barrier to the use of ACH? | |Yes |

| | |No |

| | |Don’t know |

|As an Originator, would your organization make use of oral authorizations other than on a | |Yes |

|telephone call? | | |

| | |No |

| | |Don’t know |

| | |Not an Originator |

|Does your organization support the proposal to define an Oral Authorization as a valid | |Yes |

|authorization method for consumer debits distinct from a telephone call? | | |

| | |No |

| | |Don’t know |

|Does your organization agree that an Oral Authorization obtained over the Internet (that is not a| |Yes |

|telephone call) should use the WEB SEC Code? | | |

| | |No |

| | |Don’t know |

|As an Originator, would you be able to record Oral Authorization that are obtained other than | |Yes |

|through a telephone call? | | |

| | |No |

| | |Don’t know |

| | |Not an Originator |

|Please explain why or why not:: |

|As an RDFI, is it important to know if a debit was part of an Oral Authorization? | |Yes |

| | |No |

| | |Don’t know |

| | |Not an RDFI |

|If yes, please explain why: |

|As an RDFI, would the proposal to use the WEB SEC Code for Oral Authorizations over the Internet | |Yes |

|present any challenges? | | |

| | |No |

| | |Don’t know |

| | |Not an RDFI |

|If yes, please explain why: |

|Please provide any additional comments on Oral Authorizations: |

| |

Section 5 – Other Authorization Proposals

|Does your organization support the proposal to define Recurring Entries to complement the | |Yes |

|existing definition of Single Entry and the proposed new definition of Subsequent Entry? | | |

| | |No |

| | |Don’t know |

|Does your organization support the proposal to state explicitly that authorization of an ACH | |Yes |

|payment can be by any method allowed by law/regulation? | | |

| | |No |

| | |Don’t know |

|Does your organization support applying the standards of “readily identifiable” and “clear and | |Yes |

|readily understandable terms” to all authorizations? | | |

| | |No |

| | |Don’t know |

|Does your organization support applying minimum date elements (currently enumerated in the TEL | |Yes |

|rules) to all consumer debit authorization? | | |

| | |No |

| | |Don’t know |

|Generally, does your organization think that these other authorization proposals will provide | |Yes |

|better clarity and consistency to the rules on authorization? | | |

| | |No |

| | |No difference |

| | |Don’t know |

|Please provide any additional comments on these Other Authorization Proposals: |

Section 6 – Alternative to Proof of Authorization

|As an ODFI or Originator, does your organization ever agree to accept a return when a proof of | |Yes, often |

|authorization has been requested? | | |

| | |Yes, sometimes |

| | |Yes, but rarely |

| | |No |

| | |Don’t know |

| | |Not an ODFI or Originator |

|As an RDFI, does your organization ever agree to return an entry as an alternative to getting | |Yes, often |

|proof of authorization? | | |

| | |Yes, sometimes |

| | |Yes, but rarely |

| | |No |

| | |Don’t know |

| | |Not an RDFI |

|Does your organization support the proposal that as an alternative to providing proof of | |Yes |

|authorization, an ODFI may agree to accept a return entry? | | |

| | |No |

| | |Don’t know |

|As an ODFI or Originator, would your organization make use of this alternative? | |Yes, for all requests for proof|

| | |Yes, for some requests |

| | |No |

| | |Don’t know |

| | |Not an ODFI or Originator |

|As an RDFI, are there any situations in which you would still request a proof of authorization | |Yes |

|after an ODFI had agreed to accept a return? | | |

| | |No |

| | |Don’t know |

|If yes, please describe: |

|Would your organization need to make changes to origination agreements to support this proposed | |Yes |

|change? | | |

| | |No |

| | |Don’t know |

|Do you think this proposal would have an impact on the quality of authorizations? | |Yes |

| | |No |

| | |Don’t know |

|Please provide any additional comments on Alternatives to Proof of Authorization: |

Section 7 – Written Statements of Unauthorized Debits via Electronic or Oral Communication

|As an RDFI, does your institution currently obtain Written Statements (WSUD) as Electronic | |Yes |

|Records? | | |

| | |No |

| | |Don’t know |

| | |Not an RDFI |

|If yes, what methods are used? | |Oral |

| | | |

| | |Via the Internet |

| | |other |

| | |Don’t know |

|If no, why not? | |Didn’t know it was allowed |

| | |Has not been a priority to set up the technology; current system works fine for us |

| | |Don’t want to obtain electronically or orally; prefer having a paper copy |

| | |Other: |

|Does your organization support the proposal to make explicit that an RDFI may obtain a consumer’s| |Yes |

|Written Statement of Unauthorized Debit (WSUD) electronically or orally? | | |

| | |No |

| | |Don’t know |

|As an RDFI, if your institution does not currently obtain WSUD as Electronic Records, will you | |Yes, definitely |

|start with this proposed language clarification? | | |

| | |Yes, probably |

| | |No, we still won’t |

| | |Don’t know |

| | |Not an RDFI |

|Please explain why or why not. |

|As an ODFI or Originator, would an RDFI’s provision of a WSUD as an Electronic Record present any| |Yes |

|challenges? | | |

| | |No |

| | |Don’t know |

| | |Not an ODFI or Originator |

|Please provide any additional comments on Written Statement of Unauthorized Debit via Electronic or Oral Methods: |

Section 8 – Anticipated Impacts

|On a scale of 1-5 (with “1” representing no impact, and “5” indicating extensive impact), please indicate the estimated impact of the proposed |

|changes to your organization in various areas: |

| |1 = |2 = Minimal |3 = Moderate |4 = |5 = Extensive |Don’t know |

| |No impact |impact |impact |Large impact |impact | |

|Standing Authorizations |

|Systems and software | | | | | | |

|Staffing resources and training | | | | | | |

|ACH Operations | | | | | | |

|Oral Authorizations |

|Systems and software | | | | | | |

|Staffing resources and training | | | | | | |

|ACH Operations | | | | | | |

|Other Authorization Proposals |

|Systems and software | | | | | | |

|Staffing resources and training | | | | | | |

|ACH Operations | | | | | | |

|Alternative to Proof of Authorization |

|Systems and software | | | | | | |

|Staffing resources and training | | | | | | |

|ACH Operations | | | | | | |

|WSUD via Electronic or Oral Communication |

|Systems and software | | | | | | |

|Staffing resources and training | | | | | | |

|ACH Operations | | | | | | |

Section 9 - Proposed Effective Date

|Does your organization support the proposed effective date of July 1, 2021 for the | |Yes, for all portions |

|proposed changes included in this RFC? | | |

| | |Yes, for some portions |

| | |No |

| | |Don’t know |

|If No, but you believe that all the portions should implement at one time, what | |October 1, 2021 |

|effective date would you support? | | |

| | |January 1, 2022 |

| | |Other |

|If there are any portions of this RFC that you believe | |Standing Authorizations | |

|should have a different effective date, please indicate | | | |

|which and insert a preferred date in the right column: | | | |

| | |Oral Authorizations | |

| | |Other Authorization Proposals | |

| | |Alternative to Proof of Authorization | |

| | |WSUD via Electronic or Oral Communication | |

|Do you have any other comments or suggestions on this proposal not already provided? |

| |

Section 10 – Request for Information

|As an ODFI or Originator, how frequently do you get an ACH debit returned as unauthorized after | |It is common |

|providing proof of authorization? | | |

| | |It is rare |

| | |It never happens |

| | |Don’t know |

| | |Not an ODFI or Originator |

|Do you think the Nacha Rules should allow ODFIs and/or Originators to appeal the basis of a | |Yes |

|return as unauthorized? | | |

| | |No |

| | |Don’t know |

|If an authorization dispute appeal process is created, should it be limited in | |Yes, there should be limits |

|any manner? | | |

| | |No, it should be available for any consumer debit |

| | |returned as unauthorized |

| | |Don’t know |

|If an authorization dispute appeal process should be limited, what types of | |Dollar threshold (must be over a minimum dollar amount)|

|limits should be considered? | | |

| | |Volume threshold (must be over a certain number of |

| | |entries) |

| | |Apply only to returns past the available return window |

| | |Apply only to recurring entries (i.e., not available |

| | |for Single Entries) |

| | |Other: |

|If other, please describe: |

|Should there be an upfront cost to discourage frivolous claims? | |Yes |

| | |No |

| | |Don’t know |

|Who should make the determination of a valid proof of authorization? Check all that could apply | |ACH Rules Enforcement Panel |

| | |Nacha arbitrators |

| | |Nacha staff |

| | |Other: |

|Other? |

|Please explain why |

|Please answer the following: |

|What should happen if a claim or appeal is decided in favor of the ODFI/Originator? |

| |

|What should happen if a claim or appeal is decided in favor of the RDFI/Receiver? |

| |

|What should happen if it is not clear or conclusive whether an authorization is valid? |

| |

|What is your perspective on the weighing of the potential benefits vs. the potential costs of an appeal mechanism? |

| |

|What is your perspective on the potential benefit to ACH Originators vs. a perception of the ACH Network being less consumer-friendly? |

| |

|Please provide any other comments on this Request for Information on authorization dispute resolution. |

| |

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