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Check/Check 21 Services

Commercial check and ACH posting rule changes

June 15, 2015

On December 1, 2014 (Off-site Link), the Board of Governors of the Federal Reserve System announced changes to Part II of the Federal Reserve Policy on Payment System Risk. These changes are designed to enhance the efficiency of the payment system, to align posting times with current operations and processing times and to strategically position the rules for future advancements in the speed of clearing and settlement. These changes will become effective July 23, 2015.  Below are a few changes that could impact your organization. Review the summary of changes (PDF) for more information.

Changes in posting times
FedACH® transactions

  • The morning posting time for FedACH debit transactions will change from 11:00 a.m. to 8:30 a.m. ET

Commercial Check transactions

  • Credits for deposits or returns of electronic items will post at 8:30 a.m., 1:00 p.m. and 5:30 p.m. ET. Items will post at the next posting time that is at least 30 minutes after deposit. Today these items post hourly beginning at 11:00 a.m. ET.
  • Debits for items presented or returned electronically will post at 8:30 a.m., 1:00 p.m. and 5:30 p.m. ET. Items will post at the next posting time that is at least 30 minutes after presentment. These items currently post on the clock hour one hour after presentment, but not before 11:00 a.m. ET
  • Credits for deposits or returns of Paper Checks will post at 8:30 a.m. ET and debits for checks presented or returns delivered as paper will post at 5:30 p.m. ET
  • A freeze period for customer changes will be in place from July 20 through July 28, 2015.

Changes to the daily Statement of Account
There will be a number of changes to the descriptions, definitions and posting times for many ACH and Check transaction codes. An updated Account Management Guide with the changes will be posted on June 23, 2015.

Managing your Master Account
If you have a Master Account, it is important that you monitor your intraday daylight overdraft balance to ensure that the Federal Reserve Policy on Payment System Risk changes do not result in unanticipated overdrafts. There are a number of tools available via the Account Management Information (AMI) application available through the FedLine® access solutions. Through AMI, you can view your real-time Daylight Overdraft Balance, view when transaction totals will be applied to your account in accordance with Payments System Risk posting rules and view daylight overdraft posting times associated with individual transactions.

We encourage you to share this information with others in your organization who may be impacted by these changes. This could include Accounting, Treasury Management, and Risk Monitoring staff, among others. If you use a processor, we encourage you to share this with them as well.

If you have any questions, please contact the following:

  • Accounting questions can be directed to your District’s Account Service contact
  • ACH questions can be directed to FedACH Customer Support at (866) 234-5681
  • Check questions can be directed to Check Customer Support at (877) 372-2457
  • Federal Reserve Policy on Payment System Risk changes can be directed to your local Credit and Risk Management contact

Announcement

On December 1, 2014 (Off-site Link), the Board of Governors of the Federal Reserve System announced changes to Part II of the Federal Reserve Policy on Payment System Risk. These changes are designed to enhance the efficiency of the payment system, to align posting times with current operations and processing times and to strategically position the rules for future advancements in the speed of clearing and settlement. These changes will become effective July 23, 2015. Review the summary of changes (PDF) for more information.

 

Freeze period for Check Services

June 15, 2015

The Federal Reserve Banks will implement a freeze period for Check Services from July 20 through July 28, 2015. This freeze period is necessary to prepare for the upcoming posting rules changes effective July 23, 2015.

Key dates are:

July 17, 2015
Last day for implementations and changes

July 29, 2015
Window re-opens for implementations as well as all other changes

If you have questions, please contact Customer Support at (877) 372-2457.

 

Change in process for handling items drawn on retired routing numbers

June 15, 2015

The Federal Reserve Banks continually look for opportunities to improve the speed and reduce the risk associated with our FedForward® and FedReturn® services. Over the last 18 months we have instituted later deposit deadlines for forward and return items in an effort to move items through the collection and return cycle more quickly. We are now planning to change the way that we handle forward collection items drawn on officially retired routing transit numbers (RTNs).

As announced May 18, 2015 (PDF), beginning in the third quarter of 2015, the Reserve Banks will return items drawn on retired RTNs directly to the bank of first deposit (BOFD) (or the depositing financial institution if there is no BOFD routing number in the 26 record) rather than flowing these items to the paying bank for subsequent return. This change will align our process with the industry, and will also result in these items usually being returned to the BOFD the same day that they are deposited with the Reserve Banks.

Once we make the change, we will begin using the industry standard return reason code 6: Retired/Ineligible RTN. We encourage you to verify that your systems will accept items using that reason code. We also encourage you to contact Accuity to obtain a quote to purchase a list of retired routing numbers or if you have a retired RTN that you would like to reactivate.

If you have questions, please contact Customer Support at (877) 372-2457 or your account executive.

Announcement

As announced May 18, 2015 (PDF), beginning in the third quarter of 2015, the Reserve Banks will return items drawn on retired RTNs directly to the bank of first deposit. Once we make the change, we will begin using the industry standard return reason code 6: Retired/Ineligible RTN. If you have questions, please contact Customer Support at (877) 372-2457 or your account executive.

 

Check Adjustments Tip: Check Adjustments Automated Status Report at your fingertips

June 15, 2015

Are you a FedLine® access solutions customer with access to the Check Adjustments application? Would you like to increase the efficiency of Check Adjustment case status maintenance?

The Federal Reserve Banks have made status tracking convenient for you. At the end of each processing day, the Check Adjustments Automated Status Report is available as a menu option under the Import/Export feature.

The daily Status Report provides information on the status of adjustment requests submitted to the Federal Reserve Banks that are pending a response from another institution, are awaiting supporting documentation, referred to as Documents-to-Follow (DTF), or for which a provisional entry or requested information has not been provided.

How is this report beneficial to your institution? You can update and track your requests internally with a click of the mouse. You can also use the report as documentation for cases that are pending a response from the Federal Reserve Banks. By using the Check Adjustments Automated Status Report, combined with responses to your requests (located in the Inbox feature), you are able to manage adjustments with greater efficiency.

Need a run-through session on how to access the report? The Federal Reserve Banks have prepared an online learning tool that provides step-by-step instructions for accessing and downloading the report. Refer to the Learning Center, located in FedLine Home, for an interactive tutorial entitled Daily Status Report, which is a menu option under the Import/Export feature.

For additional assistance or questions with the report, please contact Check Services Support at (877) 372-2457.

Announcement

The Federal Reserve Banks have made status tracking convenient for you. At the end of each processing day, the Check Adjustments Automated Status Report is available as a menu option under the Import/Export feature. The daily Status Report provides information on the status of adjustment requests submitted to the Federal Reserve Banks. For additional assistance or questions with the report, please contact Check Services Support at (877) 372-2457.

 

Spotlight on Train the Trainer webinar

June 15, 2015

To help your institution maximize its understanding of Check Adjustments, the Federal Reserve Banks offer Check Adjustments webinars.

Among various webinar topics that are available, the Check Adjustments Train the Trainer (T3) webinar can be very beneficial. Not only is the T3 webinar a valuable tool for trainers, but it also provides an interactive way to increase your knowledge of adjustments.

In this webinar, we will focus on resources and information that can be used to effectively train staff on the concepts of adjustments, case submission of electronic adjustments, and required supporting documentation.

This three-hour webinar is offered for a per-connection fee of $250, payable only by credit card, and an institution may allow several participants to attend the webinar using a single connection.

To register, please visit Federal Reserve Bank Events.

Announcement

To help your institution maximize its understanding of Check Adjustments, the Federal Reserve Banks offer Check Adjustments webinars, such as the Check Adjustments Train the Trainer (T3) webinar. Not only is the T3 webinar a valuable tool for trainers, but it also provides an interactive way to increase your knowledge of adjustments. To register, please visit Federal Reserve Bank Events.

 

Upcoming Check Services operations freeze

June 15, 2015

The Federal Reserve Banks’ Check Services will be unavailable between 12:01 a.m. ET, Saturday, June 27, through 2:00 p.m. ET, Sunday, June 28, 2015. The freeze period is necessary to conduct a Systemwide contingency test.

During the test, Check files will not be processed and Deposit Notifications will not be generated. Check files normally deposited during this period will need to be sent after the test is completed, which is expected to be after 2:00 p.m. ET, June 28, 2015. Additional information will be communicated via Email Alert Notifications and on the Check Services page.

Announcement

The Federal Reserve Banks’ Check Services will be unavailable between 12:01 a.m. ET, Saturday, June 27, through 2:00 p.m. ET, Sunday, June 28, 2015. The freeze period is necessary to conduct a Systemwide contingency test.

 

Canadian item cash letter deposit reminders

June 15, 2015

The Federal Reserve Banks offer a Canadian item clearing service for items denominated in either U.S. dollars or Canadian dollars. The following reminders will assist customers in packaging their deposits correctly:

  • Canadian checks must be sorted into the proper cash letter according to whether they are denominated in U.S. or Canadian dollars. “U.S. Funds” or “U.S. Dollars” must be on the face of the item if it is to be included in a U.S. funds cash letter. If you are unsure whether the item is denominated in U.S. funds, there may be a "45" in the Transaction Code, which is located between the amount field and the opening symbol of the account number section of the magnetic ink character recognition (MICR) line.
  • If an item does not state that it is in U.S. funds, you should assume that it is drawn in Canadian funds, and it should be deposited in a Canadian funds cash letter.
  • Every effort will be made to correctly process forward items deposited in mismatched cash letters. However, any item sent in the wrong cash letter type will be subject to a Cash Letter Correction fee, in addition to the forward collection fee, or may be sent back to you as a return item with a return item fee charged.

If you have questions about the Canadian Item service, please contact your account executive.

Reminder

The Federal Reserve Banks offer a Canadian item clearing service for items denominated in either U.S. dollars or Canadian dollars. Canadian checks must be sorted into the proper cash letter according to whether they are denominated in U.S. or Canadian dollars. If an item does not state that it is in U.S. funds, you should assume that it is drawn in Canadian funds, and it should be deposited in a Canadian funds cash letter.

 

Federal Reserve Banks to publish new FedReceipt® RTNs

June 15, 2015

New FedReceipt RTNs for FedForward® and FedReturn® Services deposits will be published the week of July 6, 2015. These lists will reflect changes to the FedReceipt lists that have occurred between June 1 and June 30, 2015. For more information, please visit the Check 21-Enabled Services Endpoint Tier Listings, where you can review the May 31, 2015 Summary of Changes to FedReceipt Routing Numbers (XLS).

 

FedACH® Services

FedACH Feature: The FedACH Risk® RDFI Alert Service can provide a basic type of ACH positive pay service to business customers

June 15, 2015

Your institution can use the FedACH Risk RDFI Alert Service to offer a basic type of positive pay service to its business customers. Once the service is activated, establishing all items criteria sets for business customers will automatically send an email to them with reports of all incoming Automated Clearing House (ACH) debits and credits along with corresponding information about originators and amounts.

Scan this quick reference guide – Creating a Basic Positive Pay Notification Service for the DFI Corporate Customer (PDF) – and learn more about the information-only RDFI Alert Service.

Announcement

Your institution can use the FedACH Risk RDFI Alert Service to offer a basic type of positive pay service to its business customers. Scan this quick reference guide – Creating a Basic Positive Pay Notification Service for the DFI Corporate Customer (PDF) – and learn more about the information-only RDFI Alert Service.

 

Commercial check and ACH posting rule changes

June 15, 2015

On December 1, 2014 (Off-site Link), the Board of Governors of the Federal Reserve System announced changes to Part II of the Federal Reserve Policy on Payment System Risk. These changes are designed to enhance the efficiency of the payment system, to align posting times with current operations and processing times and to strategically position the rules for future advancements in the speed of clearing and settlement. These changes will become effective July 23, 2015.  Below are a few changes that could impact your organization. Review the summary of changes (PDF) for more information.

Changes in posting times
FedACH® transactions

  • The morning posting time for FedACH debit transactions will change from 11:00 a.m. to 8:30 a.m. ET

Commercial Check transactions

  • Credits for deposits or returns of electronic items will post at 8:30 a.m., 1:00 p.m. and 5:30 p.m. ET. Items will post at the next posting time that is at least 30 minutes after deposit. Today these items post hourly beginning at 11:00 a.m. ET.
  • Debits for items presented or returned electronically will post at 8:30 a.m., 1:00 p.m. and 5:30 p.m. ET. Items will post at the next posting time that is at least 30 minutes after presentment. These items currently post on the clock hour one hour after presentment, but not before 11:00 a.m. ET
  • Credits for deposits or returns of Paper Checks will post at 8:30 a.m. ET and debits for checks presented or returns delivered as paper will post at 5:30 p.m. ET
  • A freeze period for customer changes will be in place from July 20 through July 28, 2015.

Changes to the daily Statement of Account
There will be a number of changes to the descriptions, definitions and posting times for many ACH and Check transaction codes. An updated Account Management Guide with the changes will be posted on June 23, 2015.

Managing your Master Account
If you have a Master Account, it is important that you monitor your intraday daylight overdraft balance to ensure that the Federal Reserve Policy on Payment System Risk changes do not result in unanticipated overdrafts. There are a number of tools available via the Account Management Information (AMI) application available through the FedLine® access solutions. Through AMI, you can view your real-time Daylight Overdraft Balance, view when transaction totals will be applied to your account in accordance with Payments System Risk posting rules and view daylight overdraft posting times associated with individual transactions.

We encourage you to share this information with others in your organization who may be impacted by these changes. This could include Accounting, Treasury Management, and Risk Monitoring staff, among others. If you use a processor, we encourage you to share this with them as well.

If you have any questions, please contact the following:

  • Accounting questions can be directed to your District’s Account Service contact
  • ACH questions can be directed to FedACH Customer Support at (866) 234-5681
  • Check questions can be directed to Check Customer Support at (877) 372-2457
  • Federal Reserve Policy on Payment System Risk changes can be directed to your local Credit and Risk Management contact

Announcement

On December 1, 2014 (Off-site Link), the Board of Governors of the Federal Reserve System announced changes to Part II of the Federal Reserve Policy on Payment System Risk. These changes are designed to enhance the efficiency of the payment system, to align posting times with current operations and processing times and to strategically position the rules for future advancements in the speed of clearing and settlement. These changes will become effective July 23, 2015. Review the summary of changes (PDF) for more information.

 

FedCash® Services

Have you ever wondered how U.S. currency makes its way into circulation? Watch this!

June 15, 2015

Did you know that once printed, Federal Reserve notes make their way to the public through the 12 Federal Reserve Banks and their network of cash operations?

As explained in our latest video (Off-site Link), Michael Lambert, associate director for the U.S. Currency Program at the Federal Reserve Board, discusses how U.S. currency gets into circulation. As Lambert explains, the Federal Reserve Board is the issuing authority for U.S. currency. Once the Board places the annual print order (Off-site Link), the Bureau of Engraving and Printing (BEP) prints the Federal Reserve notes and conducts quality inspections.

Federal Reserve notes are then moved to the Federal Board’s vault at the BEP, and from there, the currency is moved to the 12 Federal Reserve Banks across the country. As financial institutions order currency, the Federal Reserve Banks begin circulating notes. There were approximately $1.36 trillion in circulation as of April 29, 2015, of which $1.32 trillion were in Federal Reserve notes.1

For more information on the Board’s role in issuing currency, please review the Board’s Currency and Coin Frequently Asked Questions (Off-site Link).

Remember to stay up-to-date with U.S. currency information, videos (Off-site Link) and educational materials (Off-site Link) by visiting the U.S. Currency Education Program's website (Off-site Link). To receive Currency Education Program emails, please complete the sign-up form.

1SOURCE: http://www.federalreserve.gov/faqs/currency_12773.htm (Off-site Link)

Announcement

As explained in our latest video (Off-site Link), Michael Lambert, associate director for the U.S. Currency Program at the Federal Reserve Board, discusses how U.S. currency gets into circulation. Remember to stay up-to-date with U.S. currency information, videos (Off-site Link) and educational materials (Off-site Link) by visiting the U.S. Currency Education Program's website (Off-site Link). To receive Currency Education Program emails, please complete the sign-up form.

 

Fedwire® Services

Fedwire Securities Service testing requirements

June 15, 2015

The next phase of the Federal Reserve Banks’ wholesale services modernization effort includes system changes and a software release for the Fedwire Securities Service. Neither the system changes nor the software release will be visible to customers or their service providers.

The new Fedwire Securities Service software release has been placed in the Depository Institution Test (DIT) environment, where it may be tested through June 29, 2015.  All customers and service providers that access the Fedwire Securities Service via the FedLine Direct® access solution must test in the DIT by June 29, 2015. Testing is recommended for all customers and service providers that access the Fedwire Securities Service through the FedLine Advantage® access solution (i.e. those that use FedPayments® Manager – Securities).

A detailed communication regarding testing was sent to customers and service providers on May 18, 2015. If you have questions or need detailed testing information for your organization, please contact your designated Wholesale Testing Unit.

Announcement

The new Fedwire Securities Service software release has been placed in the Depository Institution Test (DIT) environment, where it may be tested through June 29, 2015. All customers and service providers that access the Fedwire Securities Service via the FedLine Direct® access solution must test in the DIT by June 29, 2015. If you have questions or need detailed testing information for your organization, please contact your designated Wholesale Testing Unit.

 

Treasury Services

Reminder: TreasuryDirect® accounts not required to redeem paper savings bonds

June 15, 2015

As of January 1, 2012, the U.S. Department of Treasury ended sales of paper savings bonds at financial institutions. A person must have a TreasuryDirect account to buy an electronic savings bond. This change did not affect how paper savings bonds are redeemed for customers.

Paper savings bonds may be redeemed at financial institutions

  • While paper savings bonds are no longer sold over-the-counter at financial institutions, redeeming savings bonds is an easy way for financial institutions to provide service to customers.

A person does not have to open a TreasuryDirect account to redeem paper savings bonds

  • Financial institutions can redeem Series A–E, EE and I paper savings bonds, savings notes and savings stamps for customers who present proper identification.

Financial institutions may find additional information on how to service bond holders at www.treasurydirect.gov (Off-site Link).

“TreasuryDirect” is a registered service mark of the U.S. Department of the Treasury, Bureau of the Fiscal Service.

Reminder

Paper savings bonds may be redeemed at financial institutions. People do not have to open a TreasuryDirect® account to redeem paper savings bonds. Financial institutions may find additional information on how to service bond holders at www.treasurydirect.gov (Off-site Link).

 

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