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Severe Weather Could Impact ACH Processing - Excused Delay Rule Reminder

Wednesday, January 3, 2018

Due to the imminent winter weather conditions, we want to remind you of the Excused Delay provision of the NACHA Operating Rules (Section 1.5, page OR3). Please be aware: if you, as an ODFI receive a late return and dishonor it, it may come back as a Contested Dishonored Return - Timely Original Return R73. In this case, you may reach out to the RDFI and determine if it has, in fact, invoked an Excused Delay. Be aware, an ODFI receiving a Contested Dishonored Return is the last step an Entry can take within the ACH Network; any additional steps to resolve the return must be handled outside of the Network. The Rule language for Excused Delay appears below. 

Excused Delay Rule Interpretation:

The NACHA Operating Rules include a provision for Excused Delay that applies to processing delays caused by an interruption of communications or computer facilities that is out of the control of the financial institution, due to an act of God, war, or other situations. This rule is not intended to excuse delays due to general failure of a financial institution's computer system or other equipment.

If an institution's ability to process ACH transactions is impacted by storms, once the system is operational, the RDFI may invoke Excused Delay and originate return transactions as they normally would. If the RDFI receives returns back from the ODFI as dishonored returns bearing code R68, Untimely Return, then the RDFI may contest the Dishonored Return using code R73, Timely Original Return. If the ODFI contacts RDFI for clarification, the RDFI should explain that it is using the Excused Delay provision of the ACH Operating Rules and be able to provide the reason why Excused Delay was invoked.

RDFIs may choose to proactively call the ODFI before sending the original return, but are not obligated under the ACH Rules to do so. 

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