ACH Exception Handling for ODFIs

Ideally, when an ACH Entry is Originated through the ACH Network, there will be no issues or hiccups in ensuring the successful processing and posting of that transaction. Unfortunately, not all ACH transactions will process the way they are expected to. Receiving Depository Financial Institutions (RDFIs) must work through any exception items and determine if they can post, post, and send a notification of change (NOC), or return the Entries. These RDFI ACH activities will result in actions that an Originating Depository Financial Institution (ODFI) needs to respond to.

There is added complexity for ODFIs in needing to rely on Originators to ensure that appropriate actions are taken for certain ACH activities. ODFIs deal with common functions related to ACH exceptions: reinitiation of returned items, Dishonored and Contested Dishonored returns, incoming NOCs, reclamations, and even reversals. All these activities have associated ACH Rules and requirements. This session will discuss these functions and the importance of exception-handling processing at ODFIs. Some of the topics explored include the role of parties such as RDFIs, ODFIs, and Originators, ACH Rules for processing exception items, and possible outcomes and ramifications for not following associated Rules. Join us for this session and learn more about ODFI’s ACH exception processing protocols.

During this session attendees will:
• Describe the different types of ACH exception Entries
• Discuss the ODFI and Originator’s responsibilities
• Explore the proper handling of exception entries