WASHINGTON (1/16/14)--NACHA--The Electronic Payments Association should examine more targeted, less costly ways to help reduce exceptions by Originating Depository Financial Institutions (ODFIs), the Credit Union National Association said in a comment letter.
The comment letter follows the release of a proposed Automated Clearing House (ACH) rule that would reduce exceptions by establishing a system of economic incentives for ODFIs. An ODFI would pay fees based on exceptions to partially offset the Receiving Depository Financial Institution's (RDFI) costs for exception processing and customer service.
The proposal would require ODFIs to pay the following fees to RDFIs:
CUNA Assistant General Counsel Dennis Tsang noted that credit unions generally originate higher quality transactions and are not likely to be significantly impacted by the proposal. Also, they would receive fees to offset costs incurred for exception processing and customer service.
However, Tsang said, some credit unions oppose the concept of fees paid by ODFIs based on returns, because ODFIs may not be able to fully control the transactions originated by the Originators. Credit unions feel this approach is not targeted to reduce risk, he said.
The CUNA letter asked NACHA to minimize costs on credit unions that may be affected and minimize unintended consequences. NACHA should conduct a robust, comprehensive study that includes financial institutions of all types and sizes to measure better the costs incurred by all RDFIs for handing exceptions before it moves forward with finalizing the proposal, the CUNA letter added.
The CUNA letter also urged NACHA to:
NACHA should also delay the compliance date by at least three months after the proposed March 20, 2015 effective date, CUNA said.
For the full comment letter, use the resource link.