Automated clearing house (ACH) payment volume increased by more than 475 million transactions in 2009, bringing year-end total transaction volume to 18.76 billion, a 2.6% increase over 2008 activity, according to Nacha – The Electronic Payments Association. Year-over-year comparisons demonstrated strong volume increases in ACH native electronic payments – direct deposit, consumer internet transactions, and business-to-business (B2B) transactions – and in back office cheque conversion. In addition, Nacha has reported a continued positive trend in risk mitigation, witnessed by the ongoing decline in the unauthorised debit volume.
Network Risk Indicators
While ACH volume continues to increase, unauthorised debits have been on a multi-year downward trajectory. The number of ACH debits returned as unauthorised in 2009 declined 9.6% over 2008. These transactions constitute 0.02% of total network volume.
“The trend we’re seeing with unauthorised debits is a direct result of new Nacha rules and other enforcement efforts that went into effect in 2008,” said Janet Estep, president and chief executive officer (CEO) of Nacha. “Analysing the data, we see the absolute volume of unauthorised debits dropped following the implementation of the Network Enforcement Rule and the Company Name Rule. These results demonstrate the effectiveness of targeted rulemaking and risk-management practices.”
Native Electronic Payments
ACH native electronic payments (non-cheque conversion transactions) increased by 4.15% in 2009, showing an increased preference for non-cheque, fully-electronic, payment options. These payments constituted 12.19 billion transactions on the ACH network.
Direct deposit continues to deliver a critical piece of network volume. For 2009 year-end, there were 4.54 billion direct deposit payments, an increase of 4.9% over 2008.
“In the difficult economic environment of 2009, the ACH network continued to see steady volume growth, including direct deposit transactions,” said Estep. “Notwithstanding a 10% unemployment rate, direct deposit volume increased nearly 5% in 2009. This exemplifies its ongoing adoption, including the potential increase in the use of split deposit for savings. These figures reinforce that direct deposit offers value for all parties – consumers, businesses, and their financial institutions.”
B2B transaction volume was up to more than two billion payments in 2009, an increase of 3.2% over 2008. The largest growth was in corporate trade exchange transactions, which carry business remittance information along with the payment. These payments increased by 9.19% over 2008, reaching more than 60 million transactions. In addition, the number of B2B addenda records with the remittance information increased by 8.52% year-over-year. The increases in this transaction volume and addenda records with remittance information demonstrates that growth continues for companies using the ACH network for transmitting robust information.
Consumer Internet Transactions
Overall, year-end 2009 consumer internet transactions (including web and CIE) were up 8.75% to nearly 2.4 billion payments. Internet-initiated volume has been on an upward trajectory which continued through the close of 2009 with a substantial 9.7% increase over 2008. Additionally, Nacha and ACH network participants have continued to manage risk well on these efficient transactions. Year-over-year comparisons show a significant 13% decline in the number of unauthorised web debits, with an overall unauthorised rate of return at a nominal 0.04%.
Back Office Cheque Conversion
Back office conversion (BOC) continued its growth pattern as more companies seek ways to streamline administrative tasks for processing cheques presented by their customers. In 2009, BOC transaction volume more than doubled (104.56%) over 2008, resulting in 160.5 million transactions.
International ACH Transactions (IAT)
The fourth quarter of 2009 provided the first full-quarter transaction data for IAT. Combined with the nine banking days in 3Q09 where IATs were available, the year-end total for IAT was 1.7 million with a dollar value of US$7.4bn.
Comparing 2008 and 2009, total federal government ACH transactions increased by 5.52% to 1.21 billion transactions, while dollars increased 7.22% to US$4.29 trillion. The United States Department of the Treasury’s Financial Management Service has released data that indicates that the federal government saves $0.925 for every ACH credit used instead of a cheque. In 2009, there were 1.08 billion government ACH credits, representing a US$1bn cost savings for the federal government.
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