When it comes to last year’s ACH Rules changes surrounding stop payment orders, our Member Support team has received many questions so far in 2022. Nacha did change some verbiage in the Rules last year (see Supplement #3-2021) and it seems to have left some of our members scratching their heads. These verbiage changes could impact how you handle stop payment orders at your financial institution, so let’s review the changes and how they impact your organization.
First, with the introduction of standing authorizations and subsequent entries, Nacha changed the title of Subsection 3.7.1.2 to RDFI Obligation to Stop Payment of Single and Subsequent Entries. Previously, this section only addressed single entries. This subsection title change was intended to make it clear that RDFIs are obligated to honor stop payment orders on subsequent entries as they are with any other entry – provided that the order is given to the RDFI by the Receiver in such time and manner that the RDFI has a reasonable opportunity to act, of course.
Next, the one drawing the most attention, we have the expiration of stop payment orders on non-consumer accounts. For quite some time now, most financial institutions have had the practice of never leaving stop payments on non-consumer accounts for longer than six months, unless it is renewed in writing. However, Subsection 3.7.2.1 Effective Period of Stop Payment Orders now states:
“At a minimum, a written stop payment order regarding any debit Entry initiated or to be initiated to a Non-Consumer Account will remain in effect until the earliest of:
a) The withdrawal of the stop payment order by the Receiver;
b) the return of the debit Entry; or
c) six months from the date of the stop payment order.
An RDFI may extend the effective period of a stop payment order beyond the minimum period described above.”
You may also notice that the requirement to obtain a renewal in writing was removed, enabling RDFIs to easily leave stop payment orders on non-consumer accounts for longer than six months. The intent behind this change was to clarify that, at the RDFI’s discretion, RDFIs may set a longer effective period for stop payment orders to non-consumer accounts.
So, what does all of this mean for you? It means you can now place recurring (or “permanent”) stop payment orders on non-consumer accounts! Yes, you read that right. You can now leave stop payment orders on non-consumer accounts for longer than six months without needing to obtain a renewal in writing.
It may also mean your financial institution needs a new stop payment order form, and EPCOR has you covered! We have updated our form to reflect these changes and it is located within our EFT Dispute Resource Package, which is included in the Electronic Resources License.
As always if you have any questions regarding stop payment orders (or anything else) reach out to Member Support via phone (800.500.0100), email ([email protected]) or website chat (epcor.org).
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