Extended hours to accommodate same-day automated clearing house (ACH) processing and settlement in 2020 were approved by the Federal Reserve last week (Dec. 23).
The Fed said the extended hours will closely follow those already adopted by NACHA, the rules and standards body for the ACH network. The Fed hours will take effect in March; the NACHA rules take effect March 19.
The Fed said the extended hours will result in the National Settlement Service (NSS) closing at 6:30 p.m. ET, one hour later than its current closing at 5:30 p.m. ET. The opening time for the NSS, the Fed said, will remain at 7:30 a.m. ET.
Other results of the Fed action include:
- The Fedwire Funds Service will close at 7:00 p.m. ET, 30 minutes later than its current cutoff at 6:30 p.m. ET. The Fedwire Funds third-party cutoff will occur at 6:45 p.m. ET, 45 minutes later than its current cutoff at 6:00 p.m. ET. The opening time for the Fedwire Funds Service will remain at 9 p.m. ET on the previous calendar day.
- The Federal Reserve Banks will modify their current practice of maintaining a two-hour window between the closing and the reopening of the Fedwire Funds Service to maintain only a 90-minute window.
- The reserve banks will raise the threshold for granting extensions to the Fedwire Funds Service closing time from $1 billion to $3 billion. Also, the banks will determine whether further increases to the threshold are warranted to maintain the regular and consistent opening of the Fedwire Funds Service at 9:00 p.m. ET.
The Fed also said it is amending part II of its PSR (Payment System Risk) policy to add a new 6:00 p.m. ET posting time for same-day ACH transactions, remove the current 5:30 p.m. ET posting time for ACH return transactions, and make conforming changes to the daylight overdraft fee calculation.