Welcome to Innovating Payments Top 3 News Headlines for the Week of Nov. 13. The Federal Reserve Board announced pricing, effective Jan. 3, 2023, for payment services the Federal Reserve Banks provide to depository institutions. Also in the news, Nacha announced it has completed the last phase in the acceleration of ACH payments with the implementation of "Late Night ACH." On the business side, a new PYMTS survey revealed that early wage access could equal loyalty, creating new opportunities for financial institutions and their business customers.
Read on to learn more.
1. Federal Reserve Board announces pricing, effective Jan. 3, 2023, for payment services the Federal Reserve Banks provide to depository institutions, such as the clearing of checks, ACH transactions, and wholesale payment and settlement services (The Federal Reserve Board)
The Federal Reserve Board on Thursday announced pricing, effective Jan. 3, 2023, for payment services the Federal Reserve Banks provide to depository institutions, such as the clearing of checks, ACH transactions, and wholesale payment and settlement services. By law, the Federal Reserve must establish fees to recover the costs of providing payment services over the long run. The Reserve Banks expect to fully recover 100.2 percent of actual and imputed expenses in 2023, including the return on equity that would have been earned if a private-sector firm provided the services. Overall, the Reserve Banks estimate that the price changes for 2023 will result in a 2.9 percent average price increase. Read more.
2. The Acceleration of Faster ACH Payments Continues with Late Night ACH (Nacha)
Following the increase of the Same Day ACH dollar limit to $1 million in March 2022, Nacha and the ACH Operators - the Federal Reserve and The Clearing House - have completed the latest phase in the acceleration of ACH payments with the implementation of "Late Night ACH." Implemented in mid-September 2022, the Federal Reserve and The Clearing House now deliver late night ACH files to all receiving financial institutions in the ACH Network by 11:30 p.m. Eastern Time on business days, accelerating the delivery of ACH payments that otherwise would be received on the next business morning. Read more.
3. PYMNTS Intelligence: How Early Wage Access Can Equal Loyalty (PYMNTS.com)
The business world has transformed over the last few years as the global pandemic spurred a move away from centralized teams and toward a more agile, global workforce. Now inflation is straining many workers' budgets. The need for greater flexibility and ease in paying workers has never been greater. In recent years, more employers and third-party payers have adopted programs that allow employees to receive their earned wages on the same day that they perform the work. To build loyalty and retain talent, providing early wage access and prompt payment can mean the difference between success and failure for employers. Read more.
What impact could the Federal Reserve's pricing announcement have on your financial institution come January? How has "Late Night ACH" affected operations in your organization? How might providing instant payments for your business customers strengthen existing and build new relationships?
Check back soon for our next issue, highlighting the industry's most pressing and need-to-know developments. Until then, visit us online at Innovating Payments.
AUTHOR: Joe Casali, AAP, NCP
Executive Vice President
As the EVP of Payments Innovation for NEACH, Joe focuses on exploring innovative solutions and technologies that will help position members for success, both now and in the future. Connect with Joe to read more of his blogs, articles, and posts.