Q2 Holdings, Inc. (NYSE: QTWO), a leading provider of secure, cloud-based virtual banking solutions for regional and community financial institutions (FIs), today announced its plan to support originating same-day ACH transactions soon after they become supported by the Federal Reserve on Sept. 23, 2016.
The National Automated Clearing House Association (NACHA) recently announced the adoption of a rule that will enable same-day processing of virtually any ACH payment. Currently, ACH payments—most commonly payroll, person-to-person and bill-pay transactions—are settled on the next business day. Now, community and regional FIs can process such transactions on the same day. NACHA will implement the plan in three phases, the first of which is set to begin Sept. 23, 2016.
“Our number one focus is delivering an unparalleled user experience, and providing the convenience of same-day processing—across all devices—is critical for banks and credit unions to serve their customers and members,” said Coy Joyner, senior vice president of product at Q2. “Q2 remains on the leading edge of digital banking with the adoption of the Same Day ACH Rule, and we make it even easier for our clients to enable it at no extra cost.”
Q2 interviewed more than 20 customers with asset sizes from $100 million to $30 billion to determine the best method for providing same-day ACH origination services to online bank and credit union customers. As part of the research, Q2 also wanted to ensure optimal support to back office operations teams when processing these transactions as the Same Day ACH Rule is gradually implemented in 2016 and beyond.
“Our customers have already identified numerous offensive and defensive uses for same-day ACH transactions,” said David Raborn, product manager at Q2. “Whether to proactively market to existing customers or to offer same-day ACH to new customers as an advantage over competing institutions, Q2 is prepared to empower FIs and their customers with the mechanism to originate and process same-day ACH transactions at no additional cost.”
Q2 will also proactively provide an automated analysis of customer and member risk levels through Centrix’s Payments I.Q. System (CentrixPIQs). CentrixPIQs monitors and manages ACH activity for financial institutions, offering intuitive analytical reporting while safeguarding against ACH fraud with rapid validation of originated files—a critical component in same-day transactions.
“Everything will happen much faster with same-day ACH functionality, increasing the opportunity for error and fraud risk,” said Brian Koenig, product owner at Centrix Solutions, a Q2 company. “CentrixPIQs will validate and manage those transactions, automatically packaging them up for quick, actionable review at the institutional level.”
Although phase one of the rule only supports credits starting Sept. 23, Q2 is planning to support same-day ACH credits and debits simultaneously. Therefore, Q2 customers will not have to upgrade when phase two begins Sept. 15, 2017. Q2 plans to certify same-day ACH credits this fall and be in production with credits by year-end.