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A Nacha Mandate for Payments is Coming—Is Your Government Agency Ready?

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The following is a contributed blog from Forte, one of Accela’s preferred technology alliance partners.

If your organization allows individuals to make purchases or payments via the internet, or through electronic withdrawals, an important change revolving around the National Automated Clearing House Association’s (Nacha) rules on WEB Debit Account Validation is just around the corner.

The rule change, which takes effect on March 19, 2021, impacts ACH originators of WEB entries and the systems they use to detect fraud, all industries and governments, of all sizes, must comply with the new Nacha mandate.

By extension, all government agencies that accept credit card, ACH, or eCheck payments will be affected by the new rule, so for our state and local government customers, its important to understand the meaning and purpose of the rule change, how it affects governments, and the best way to make sure governments are covered.

What is Nacha?

Per their website, Nacha governs the thriving ACH Network, the payment system that drives safe, smart, and fast Direct Deposits and Direct Payments with the capability to reach all U.S. bank and credit union accounts. Nearly 27 billion ACH payments were made in 2020, valued at close to $62 trillion. Through problem-solving and consensus-building among diverse payment industry stakeholders, Nacha advances innovation and interoperability in the payments system. Nacha develops rules and standards, provides industry solutions, and delivers education, accreditation, and advisory services. 

What is the rule and why is it changing?

Nacha details the changes to the rule as follows: Currently, ACH Originators of WEB debit entries are required to use a “commercially reasonable fraudulent transaction detection system” to screen WEB debits for fraud. This existing screening requirement will be supplemented to make it explicit that “account validation” is part of a “commercially reasonable fraudulent transaction detection system.” The supplemental requirement applies to the first use of an account number, or changes to the account number.

The existing screening requirement will be supplemented to make it clear that account validation is part of an acceptable fraud system. The supplemental requirement applies to the first use of an account number or changes to an account number.

How can I comply with the new regulations?

Luckily, Forte and Accela can help. Forte, a payment processing provider and Accela, a provider of cloud-based solutions for state and local government, together serve more than 3,000 government agencies. Both companies have served the government technology space for over 20 years.

Specifically, Forte Verify, a real-time account validation solution, can be leveraged to meet Nacha’s new WEB Debit Account Validation rule. This feature is integrated with Accela’s software to provide real-time, actionable responses on every transaction, while identifying and rejecting high-risk accounts that are flagged or in poor standing.

Forte Verify reduces manual errors at the point of capture and significantly reduces the risk of return due to incorrect or insufficient checks across all payment channels. It provides robust features such as comprehensive routing number and bank account validation across multiple data sources, which are updated daily. Additionally, the solution provides insights into approvals and declines with real-time reporting while ensuring FCRA compliance.

As an Accela preferred technology alliance partner, Forte is fully integrated into Accela’s software, allowing for a completely automated payment experience. The combination allows government clients to handle fees for business and professional licenses, recreational permits and other integrations managed by Accela products. The integration of Forte’s processing engine and Accela’s intuitive software simplifies both the service and payments processes.

To learn more about how Accela and Forte are empowering government agency efficiency, contact your Accela representative or Rolando Navarro at governmentsales@forte.net or (866) 290-5400.

About The Author / Rolando Navarro

Rolando Navarro is the Government Sales Manager at Forte. He has over 20 years of experience in the government payments industry and is responsible for overseeing Forte’s government Sales team, providing daily oversight and guidance throughout all stages of the sales process. In addition, Rolando works closely with Forte’s government partners throughout the United States to gain feedback and insights into product development to ensure customer satisfaction.

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