Removing Barriers Blog

Comments Submitted to the Fed on Potential Modifications to the National Settlement Service and Fedwire Funds Service
Posted July 16, 2019 by CUNA Advocacy

Yesterday, CUNA wrote a letter to the Federal Reserve Board regarding potential modifications to the Federal Reserve Banks' National Settlement Service (NSS) and Fedwire Funds Service to support enhancements to the same-day automated clearinghouse (ACH) service, which with NACHA rules changes will add a third daily processing window.   The NACHA rules changes require adjustments to Federal Reserve services so that the private sector ACH operator, The Clearing House, can settle same-day ACH transactions later in the day via the NSS. CUNA supports this rule change as it will allow credit unions provide an additional ACH window to members.

"CUNA is supportive of the proposed modifications to the National Settlement Service (NSS) and Fedwire operating hours in order to enable the addition of a third daily Automated Clearing House (ACH) processing window. The changes proposed are necessary for the implementation of a third ACH settlement window. Adding a third ACH window will improve the efficiency and speed of the US payment system. Unfortunately, due to the complex and interdependent nature of multiple systems needed to process and clear ACH transactions these changes cannot be made in a vacuum, which is why the proposed adjustments to infrastructure will be necessary to facilitate such necessary improvements."

The letter also notes that the proposed changes in timing may create risk in the system but, "prior adjustments to operating hours have not resulted in material issues and we are unaware of reasons to expect this case to be any different."