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58248

Federal Register / Vol. 80, No. 187 / Monday, September 28, 2015 / Notices

public health continues to be protected
from the hazards of radionuclides by
compliance with health based
standards. This information is required
for those facilities meeting the
definition of each Subpart. EPA’s
compliance monitoring activities vary
widely. EPA could issue a letter
requesting information about
compliance or could conduct a fullscale investigation, including on site
inspections. The information required to
be submitted is not confidential in
nature.
Respondents/affected entities: The
NAICS Codes of facilities associated
with the activity of the respondents are:
(1) Elemental Phosphorous 325188, (2)
Phosphogypsum Stacks 212392, (3)
Underground Uranium Mines 212291,
and (4) Uranium Mill Tailings 212291.
Respondent’s obligation to respond:
Mandatory.
Estimated number of respondents: 20
(total).
Frequency of response: Initially
(Once), Annually, Random
(Occasionally)
Total estimated burden: 3,000 hours
(per year). Burden is defined at 5 CFR
1320.03(b)
Total estimated cost: $500,000, which
includes $300,000 in annualized capital
and O&M costs.
Courtney Kerwin,
Acting Director, Collection Strategies
Division.
[FR Doc. 2015–24500 Filed 9–25–15; 8:45 am]
BILLING CODE 6560–50–P

FEDERAL RESERVE SYSTEM
[Docket No. OP–1515]

Enhancements to Federal Reserve
Bank Same-Day ACH Service
The Board of Governors
(Board) has approved enhancements to
the Federal Reserve Banks’ (Reserve
Banks) same-day automated clearing
house (ACH) service. The enhancements
require receiving depository financial
institutions (RDFIs) to participate in the
service and originating depository
financial institutions (ODFIs) to pay a
fee to RDFIs for each same-day ACH
forward transaction. The enhancements
will be adopted by incorporation of
NACHA’s amended operating rules into
Operating Circular 4, governing the
Reserve Banks’ ACH services.
DATES: Effective September 23, 2016.
FOR FURTHER INFORMATION CONTACT: Ian
C.B. Spear, Senior Financial Services
Analyst (202/452–3959); or Jessica
Stahl, Economist (202/452–6452),

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SUMMARY:

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Division of Reserve Bank Operations
and Payment Systems; Evan H.
Winerman, Senior Attorney (202/872–
7578), Legal Division; for users of
Telecommunication Devices for the Deaf
(TDD) only, contact 202/263–4869.
SUPPLEMENTARY INFORMATION:
I. Background
On May 27, 2015, the Board requested
comment on proposed enhancements to
the Reserve Banks’ FedACH® SameDay
Service (FedACH SameDay Service).1
The proposed enhancements were
intended to align the existing FedACH
SameDay Service with amendments to
NACHA’s Operating Rules and
Guidelines that were approved by
NACHA membership on May 19, 2015
(amended operating rules).2
The ACH network serves as a
ubiquitous, nationwide mechanism for
processing batch-based credit and debit
transfers electronically. The private
sector and the Federal Reserve jointly
developed the ACH network as an
electronic alternative to checks, the
growth of which in the late 1960s and
early 1970s was creating operational
and cost burdens. Currently, the ACH
network consists of two network
operators: The Reserve Banks, through
FedACH, and The Clearing House
(TCH), through the Electronic Payments
Network (EPN). Both operators provide
services to enable ODFIs to originate
and RDFIs to receive ACH transactions.
The Reserve Banks and TCH work
together to exchange inter-operator ACH
payments in which the ODFI and RDFI
are served by different operators.
The ACH network is governed by the
rules of the ACH operators, which
generally incorporate the NACHA
Operating Rules and Guidelines adopted
by NACHA’s members.3 As an ACH
operator, the Reserve Banks, through
Operating Circular 4, incorporate
NACHA’s Operating Rules and
Guidelines as rules that govern clearing
and settlement of commercial ACH
items by the Reserve Banks, except for
those provisions specifically excluded
in the Operating Circular.4 The Reserve
Banks’ Operating Circular 4 does not
govern ACH transactions conducted
through EPN.
1 80

FR 30246 (May 27, 2015).
amendments become effective in three
phases, beginning with same-day credits in
September 2016, same-day debits in 2017, and
faster funds availability in March 2018. Next-day
settlement will also remain available.
3 NACHA’s membership consists of insured
financial institutions and regional payment
associations.
4 Operating Circular 4, Section 1.4, https://
www.frbservices.org/files/regulations/pdf/
operating_circular_4_11042013.pdf.
2 The

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The Reserve Banks’ current FedACH
SameDay Service is an optional service
that allows ODFI participants to
originate same-day payments to all RDFI
participants that agree to accept such
payments.5 The Reserve Banks began
offering the service in 2010 to address
growing market demand for intraday
ACH processing and settlement. In the
five years since its introduction, the
FedACH SameDay Service has
experienced limited adoption; 78
depository institutions (less than 1
percent of FedACH customers) are
currently using the service. A number of
factors may account for this low
adoption rate. RDFIs typically need to
upgrade internal processing capabilities
to post same-day transactions. Although
ODFIs may be able to realize value from
the service through enhanced ACH
product offerings, such as emergency
bill pay, these services may be
unappealing to originators because of
low RDFI participation and
corresponding limited receiver reach.
The current FedACH SameDay Service
does not have an interbank fee.
Two aspects of NACHA’s amended
operating rules differ materially from
the Reserve Banks’ current FedACH
SameDay Service. First, under NACHA’s
amended operating rules, receipt of
same-day ACH transactions is
mandatory and RDFIs must make funds
available from same-day ACH credits to
their depositors by 5:00 p.m.6 Second,
NACHA’s amended operating rules
establish an interbank fee, paid by
ODFIs to RDFIs for each forward sameday transaction.7 As described in greater
detail below, NACHA designed the
interbank fee, initially 5.2 cents per
forward transaction, to allow RDFIs to
offset costs associated with the up-front
investments and ongoing operating costs
necessary for accepting, posting, and
making funds available from same-day
transactions. The amended operating
rules provide that the interbank fee will
be reduced if actual same-day
transaction volume exceeds original
projections by more than 25 percent
during regularly required review
periods.8 Ten years after the final phase
5 As part of the service, the Reserve Banks charge
participating ODFIs a per-item surcharge on the
normal ACH processing fee and provide RDFIs a
discount on the normal ACH processing fee for
receipt of forward items.
6 RDFIs’ local time.
7 The amended operating rules refer to the
interbank fee as the ‘‘Same Day Entry Fee.’’ Only
forward same-day transactions originated by or
through the ODFI are subject to the fee; same-day
returns will also be available but are not subject to
the interbank fee.
8 Same-day ACH volume will be reviewed five
years and eight years after the final phase of
implementation is effective.

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Federal Register / Vol. 80, No. 187 / Monday, September 28, 2015 / Notices
of implementation is effective, and
every ten years thereafter, NACHA will
reevaluate the interbank fee.9 Under
NACHA’s amended operating rules the
interbank fee may not be increased from
its initial level of 5.2 cents per forward
transaction.
These differences require
enhancements to the Reserve Banks’
existing FedACH SameDay Service that
may have a significant longer-run effect
on the nation’s payment system.10
Therefore, the Board requested
comment on the following:
• Making receipt of same-day ACH
transactions mandatory for all RDFIs. If
commenters believed that participation
by RDFIs should not be mandatory, the
Board requested comment on why the
Reserve Banks’ same-day ACH service
should remain optional and whether
there are non-mandatory alternatives to
achieving ubiquity.
• Whether the interbank fee included
in NACHA’s amended operating rules
equitably reapportions the initial
implementation costs and ongoing
operating costs between ODFIs and
RDFIs.

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II. Summary of Comments and Analysis
The Board received forty comments in
response to its request. Comments were
submitted by depository institutions,
depository institution trade
associations, national and regional
payments associations, associations
representing end users (consumers and
businesses) and third-party payment
processors, a private-sector ACH
operator, and an individual. Twentytwo commenters stated that receipt of
same-day ACH transactions should be
mandatory and that the interbank fee
appropriately reapportions costs
between ODFIs and RDFIs. Three
commenters generally supported sameday ACH services but did not
specifically address mandatory receipt
or the equity of the interbank fee.
Fifteen commenters expressed some
9 NACHA’s reevaluation will not include
implementation costs recovered through payment of
the interbank fee during the preceding period, and
will be based on the average costs incurred by
RDFIs, same-day ACH volumes, projected future
developments, and the extent to which the fee
satisfied RDFI costs.
10 The amended operating rules contain other
elements that would require modifications to the
Reserve Banks’ current FedACH SameDay Service.
The Board believes these changes are operational in
nature and will not have significant longer-run
effects on the nation’s payment system. These
include updated submission and settlement
windows (an estimated morning submission
deadline at 10:30 a.m. ET with settlement occurring
at 1:00 p.m. ET and an estimated afternoon
submission deadline at 3:00 p.m. ET with
settlement occurring at 5:00 p.m. ET). International
ACH transactions and transactions above $25,000
are not eligible for the same-day service.

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concern with one or both of the topics
on which the Board requested comment.

58249

A. Mandatory Participation of RDFIs
Thirty-seven commenters addressed
mandatory receipt of same-day ACH
transactions. Twenty-nine commenters
believed that mandatory receipt is
critical to the success of a same-day
ACH service. These commenters,
including seven small depository
institutions or associations representing
such institutions, generally agreed that
mandating receipt is necessary to
achieve a ubiquitous same-day ACH
service that provides value to end users
and depository institutions and achieves
the associated public benefits that come
from the enhanced efficiency of the
ACH network. Making receipt of sameday transactions optional, they argue,
would severely limit the benefits of any
same-day ACH service. One commenter
(one letter representing two merchant
associations), which agreed that
mandatory receipt is necessary to
achieve a ubiquitous same-day ACH
service, requested that the Board
abandon same-day ACH services to
develop real-time ACH processing.
Eight commenters, all credit unions or
credit union associations, expressed
concern that mandatory receipt of sameday ACH transactions would be overly
burdensome on smaller depository
institutions. These commenters
indicated that technical and operational
changes are necessary to receive sameday ACH transactions, and that small
institutions will be disproportionately
affected because they would be unable
to adequately offset the associated costs
of receiving such transactions because
of their lower same-day ACH volume.
Only three of these commenters
suggested alternatives: Two commenters
suggested that the Board exempt smaller
depository institutions from any
mandatory receipt requirements, and
one commenter suggested limiting
same-day ACH transactions to a single
morning submission and afternoon
settlement deadline to reduce the
burden on smaller depository
institutions.11 The commenters that
supported making receipt mandatory
included seven small depository
institutions or associations representing
such institutions, including a

community-bank trade group. These
commenters supported mandatory
receipt even in light of the associated
costs.
The Board believes that the benefits of
same-day ACH service outweigh the
costs institutions would incur to
implement such a service. Same-day
ACH capability will facilitate the use of
the ACH network for certain timecritical payments, accelerate final
settlement, and improve funds
availability to payment recipients.12 The
Board believes that these capabilities
will in turn provide a more efficient
electronic payment option for person-toperson payments, expedited bill
payments, same-day payroll payments,
and other types of transactions.13 In
light of the widespread industry support
for a same-day ACH service with an
interbank fee, as evidenced by the
approval of the NACHA amended
operating rules, the Board believes that
the costs incurred to implement such a
service are outweighed by the enhanced
efficiency of the ACH network and the
broader U.S. payment system.
The Board also believes that ubiquity
is necessary to achieve these benefits.
As with existing next-day ACH services,
same-day ACH will be most efficient if
originators can be certain that same-day
ACH transactions will reach any banked
receiver. If the same-day ACH service
lacks this ubiquity, originators would be
able to use the service to reach only a
subset of their intended receivers,
substantially reducing the attractiveness
of the service. The Board believes, and
commenters supporting mandatory
receipt agreed, that the limited adoption
of the Reserve Banks’ current FedACH
SameDay Service demonstrates an
optional service cannot achieve the
ubiquity necessary to establish a
successful same-day ACH service. The
Board agrees with the majority of
commenters that mandating receipt of
same-day ACH transactions is the only
practical method to achieve that
necessary ubiquity and the
corresponding benefits. Moreover, the
interbank fee, discussed below, is
designed to address the concerns of
RDFIs about same-day ACH
implementation and operating costs.
Although the Board acknowledges the
concerns raised by some commenters

11 Unlike the Board’s current FedACH SameDay
Service, NACHA estimates that same-day ACH
services under the amended operating rules will
include two updated submission and settlement
windows (an estimated morning submission
deadline at 10:30 a.m. ET with settlement occurring
at 1:00 p.m. and an estimated afternoon submission
deadline at 3:00 p.m. ET with settlement occurring
at 5:00 p.m.). However, exact schedules and timing
will be determined by each ACH operator and are
not set by the amended operating rules.

12 One commenter that supported same-day ACH
noted that payments processed through the check
system may clear and settle faster than some ACH
transactions today.
13 Same-day ACH may facilitate certain
transactions for which next-day ACH is not feasible.
For example, companies with limited windows for
processing payroll payments, such as payments to
hourly employees, may be able to process
transactions via same-day ACH that otherwise
would be conducted using checks or prepaid cards.

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regarding the burden of mandatory
receipt of same-day ACH transactions
for small depository institutions, the
Board does not believe that any of the
commenters provided a viable
alternative for achieving ubiquity
without such burdens. The Board
believes that exempting small
institutions would undermine the
ubiquity—and therefore the utility—of
the service. Finally, the Board believes
that limiting same-day ACH transactions
to a single morning submission and
afternoon settlement deadline would
reduce the utility of a same-day ACH
service, particularly for West Coast
depository institutions.
The Board believes that a ubiquitous
same-day ACH service will offer
considerable pro-competitive benefits.
Ubiquitous same-day ACH service could
create a new mechanism to compete
with payment methods other than ACH,
and may do so at a lower cost. As stated
above, for example, same-day ACH
capability will facilitate the use of the
ACH network for certain time-critical
payments, accelerate final settlement,
and improve funds availability to
payment recipients. The Board believes
that these capabilities will in turn
provide a more efficient electronic
payment option for person-to-person
payments, expedited bill payments,
same-day payroll payments, and other
types of transactions.
The Board also does not believe that
same-day ACH capabilities should be
abandoned to pursue real-time ACH
payments as suggested by the merchant
associations’ letter, but rather believes
that both services would be
complementary. As outlined in the
Federal Reserve’s Strategies for
Improving the U.S. Payment System
paper (Strategies Paper), the Federal
Reserve recently convened two task
forces—faster payments and secure
payments—where private-sector
participants can collaborate to create
approaches that will serve the public.14
The faster payments task force, with
input from the secure payments task
force, will identify and evaluate
alternative approaches for implementing
safe, ubiquitous, faster payments
capabilities in the United States. The
Board believes that these efforts are the
most appropriate channels to further
consider real-time ACH capabilities.
For these reasons, the Board has
approved enhancements to the Reserve
Banks’ existing FedACH SameDay
Service that make receipt of forward
14 Federal Reserve System (2015), ‘‘Strategies for
Improving the U.S. Payment System,’’ (Federal
Reserve System, January),
fedpaymentsimprovement.org/wp-content/uploads/
strategies-improving-us-payment-system.pdf.

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same-day ACH transactions mandatory
for all RDFIs.
B. Interbank Fee
Thirty-four commenters addressed
whether the interbank fee included in
NACHA’s amended operating rules
equitably reapportions the initial
implementation costs and ongoing
operating costs between ODFIs and
RDFIs.15 Thirty-two commenters
supported an interbank fee as an
appropriate method for allocating costs
between parties.
Twenty-one commenters argued that
an interbank fee of 5.2 cents is
appropriate.16 These commenters
generally stated that the interbank fee is
necessary for achieving a ubiquitous
same-day ACH service; without an
interbank fee these commenters
concluded that many RDFIs would have
opposed NACHA’s amended operating
rules. Several commenters cited the
failure of NACHA’s Expedited
Processing and Settlement (EPS)
proposal in 2011 as evidence that a
same-day ACH service lacking an
interbank fee could not succeed.17
Ten commenters (nine credit unions
or credit union associations and one
bank holding company) supported an
interbank fee but argued that the 5.2
cent fee is too low to allow smaller
RDFIs to recover costs in a reasonable
amount of time, particularly small
RDFIs with limited same-day ACH
volume. Two of these commenters
suggested that the Board create a tiered
fee structure instead of a flat fee,
allowing smaller RDFIs to receive higher
fees.
15 One additional commenter stated it was unable
to assess the equity of the interbank fee due to
variables that it believed were not adequately
addressed or evaluated by NACHA’s calculation,
including the potential for higher initial
implementation costs and lower incremental costs.
One payments association commenter that did not
specifically address the equity of the interbank fee
stated that its membership was split as to whether
to support NACHA’s amended operating rules
without the fee. One additional financial institution
commenter did not address the equity of the fee or
express clear support but suggested that the fee
would not sufficiently address extended staffing
hours necessary to meet same-day posting times.
16 One commenter that supported an interbank fee
as an appropriate method for allocating costs
between parties did not specifically address
whether the current interbank fee amount of 5.2
cents was appropriate.
17 The initial proposal to create a ubiquitous,
same-day framework failed to receive the number
of votes required for adoption under NACHA voting
rules. According to NACHA’s same-day ACH
request for comment (December 2014), one reason
for the proposal’s failure was that it created
significant implementation costs for RDFIs without
adequate options to offset those costs. Other reasons
cited for the failure of the earlier proposal were the
insufficient value to originators, and the uncertainty
around when funds would be available to receivers.

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Two commenters (a large bank and
one letter representing two merchant
associations) opposed an interbank fee
of any amount. The large bank
commenter argued that any interbank
fee will disproportionately compensate
the largest RDFIs, resulting in
unintended negative effects such as
higher end-user fees. The merchant
associations expressed concerns that the
interbank fee will impair competition
and may have antitrust implications.
The large bank commenter requested
that the Board proceed with a
mandatory same-day ACH service
without any interbank fee. The
merchant associations believed that the
Board lacks authority to require the
Reserve Banks to collect and transfer an
interbank fee. Several commenters
expressed other concerns with the
interbank fee: That NACHA would
increase the interbank fee in the future,
and that ODFIs would pass the
interbank fee on to their customers
using the service.
After considering the comments
received, and given the rejection of
NACHA’s 2011 EPS proposal, the Board
has concluded that in this specific
instance an interbank fee is necessary to
achieve a ubiquitous same-day ACH
service.18 Many commenters argued that
the inclusion of an interbank fee
increased RDFIs’ willingness to approve
NACHA’s amended operating rules
because without an interbank fee, RDFIs
would have lacked the needed business
justification to approve the mandatory
receipt requirement that is critical to
achieving ubiquity. In addition, as noted
above, the Federal Reserve’s current
same-day ACH service, which is not
mandatory and does not include an
interbank fee, is not widely used. The
Board considered whether a ubiquitous
same-day ACH service could be
achieved by mandating in the Reserve
Banks’ Operating Circular 4 that
FedACH customers receive same-day
ACH transactions without providing for
an interbank fee. The Board does not
believe that this is a viable alternative.
As described above, the Reserve Banks’
Operating Circular 4 applies only to
FedACH customers and does not govern
ACH transactions conducted through
the other ACH operator, EPN. Therefore,
any mandate adopted by the Reserve
Banks would apply only to FedACH
customers and not to EPN customers,
18 The Board’s belief that, on balance, the
interbank fee is necessary in this instance is based
on circumstances specific to the nature of the
existing ACH network, its governance, and the
requirements of the amended operating rules.
Interbank fees may not be necessary or appropriate
in the implementation of other payment services or
systems.

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resulting in a same-day service that is
not ubiquitous.19 The Board also
believes that the interbank fee must be
implemented by the Reserve Banks as
ACH operator, as it would be infeasible
for thousands of depository institutions
to collect interbank fees bilaterally. The
Board has authority to require the
Reserve Banks to collect and transfer
this fee under the Federal Reserve Act.20
In order to calculate a per-transaction
interbank fee that would allow RDFIs in
the aggregate to recover implementation
and ongoing operational costs
associated with the receipt of same-day
ACH transactions, the Board believes
that an appropriate methodology
requires certain inputs: A projection of
one-time implementation costs
associated with same-day ACH receipt,
a projection of ongoing costs associated
with same-day ACH receipt, and
projections of future same-day ACH
volume. The process would include
obtaining data from participants in the
ACH system, estimating the relationship
between costs and transaction volume,
extrapolating those estimates to the
broader universe of ACH participants,
and projecting future costs and
transaction volume.
NACHA commissioned a consultant
to calculate the interbank fee. The Board
has reviewed the consultant’s
methodology, which contained the
inputs discussed above. The Board also
reviewed the consultant’s assumptions
and judgments necessary to construct
these inputs and use them to construct
the fee. The Board believes the data and
analysis provide a reasonable basis for
the interbank fee, given the fact that
NACHA had to collect data from
voluntary respondents, make various
19 NACHA made the implementation of the
amended operating rules contingent on the Federal
Reserve’s support. If the Board had determined that
the Reserve Banks should not adopt the proposed
enhancements and provide same-day ACH service
under the amended operating rules, they would not
go into effect.
20 Specifically, the Board has authority to require
the Reserve Banks to collect and transfer this fee
under the following provisions of the Federal
Reserve Act: Section 11A (12 U.S.C. 248a), section
11(j) (12 U.S.C. 248(j)), and paragraph 14 of section
16 (12 U.S.C. 248–1). The Board’s general
supervisory authority over Reserve Banks, along
with its specific authority to require Reserve Banks
to act as a clearing house for financial institutions,
includes the ability to devise methods to cover the
costs incident to the Reserve Banks’ clearing
activities. See Fraternal Order of Police v. Board of
Governors of the Federal Reserve System, 391 F.
Supp.2d 1 (D.D.C. 2005). Moreover, an interbank fee
for same-day ACH transactions is no different, in
effect, from a situation in which the Reserve Bank
is required to pay a fee to an RDFI and therefore
requires ODFIs to pay the fee to the Reserve Bank
in order to recover Reserve Bank costs.

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projections into the future, and deal
with significant non-response.21
To facilitate its projections, the
consultant surveyed a sample of RDFIs
to obtain those banks’ projected
implementation and ongoing
operational costs. The consultant also
interviewed banks and third-party
processors to understand the potential
uses of same-day ACH. Based on
interviews, the consultant determined
that the largest RDFIs typically use
internal systems to process ACH
transactions, while other RDFIs
typically outsource to third-party
processors. Accordingly, the consultant
asked only large RDFIs and third-party
processors about one-time
implementation costs. All surveyed
RDFIs were asked about ongoing
operational costs under three different
same-day volume scenarios. Fourteen
large RDFIs and 175 smaller RDFIs
responded to the survey, yielding a
sample with reasonable representation
across RDFI sizes. The Board reviewed
the survey instruments and cost data
aggregated in seven groups according to
RDFI size; NACHA did not make cost
data of individual survey respondents
available, citing confidentiality
provisions under which the data were
provided by RDFIs. The Board believes
the survey instrument was reasonably
designed to obtain the necessary data.
Using data from these RDFIs, the
consultant estimated relationships
between costs and volumes, and used
these relationships to extrapolate to
non-responding RDFIs. Projections of
same-day ACH volume were based upon
information from ODFIs, NACHA, and
other subject matter experts. Projected
adoption rates for ten broad use cases
formed the basis for the projections of
total same-day ACH volume. Given its
projections of costs and volumes, the
consultant chose a fee that, by its
calculation, sets the present discounted
value of aggregate projected RDFI
interbank fee revenues equal to the
present discounted value of aggregate
projected RDFI costs for all RDFIs as a
whole.22
The Board recognizes that projections
of future costs and volumes are
inherently subjective, but believes the
approach used to determine the
interbank fee is reasonable. Specifically,
interviews with industry participants
21 The Board would likely have encountered
similar limitations had it undertaken this survey
and calculation directly.
22 NACHA used a 12.2 percent rate of return to
discount future revenue and cost streams associated
with same-day ACH. The Board has determined that
that a 12.2 percent rate of return is not unreasonable
for a new, relatively high-risk venture such as sameday ACH.

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58251

and extensive review of potential use
cases provided a reasonable basis for
estimating future demand for a product
that has not yet been introduced. Also,
the collection of data from a sample of
RDFIs of varying sizes through a survey
was a sensible way to assess potential
costs of the service. The Board not only
reviewed the methodology used to
calculate the fee, but also considered the
implications of the fee for the ACH
industry. The Board found the fee to be
reasonable once NACHA addressed
issues with respect to opportunity costs
in the fee and the potential for the fee
to rise over time, as described below.
NACHA issued its same-day ACH rule
for public comment in December 2014.
At that time, NACHA proposed an
interbank fee of 8.2 cents. The
calculation of that fee included
opportunity costs resulting from the
movement of transactions from highermargin payments methods, such as
wire, to same-day ACH, essentially
transferring to same-day ACH the high
margins that result from banks having
market power in other services. In its
final rule, NACHA removed the
opportunity cost component of the fee,
thereby lowering the fee from 8.2 to 5.2
cents.
The Board believes that the lower
interbank fee of 5.2 cents reasonably
balances depository institutions’ ability
to offset costs with the needs of ACH
end users. As discussed above, a 5.2
cent interbank fee would allow cost
recovery for RDFIs as a whole. Although
the fee may not allow full cost recovery
for all RDFIs, it will allow all RDFIs to
offset a portion of their costs. The Board
expects that, in most cases, the
interbank fee will ultimately be borne
by end users that originate same-day
ACH transactions, a concern echoed by
several commenters. For some
originators, faster settlement or funds
availability associated with same-day
ACH may be worth these potentially
higher costs, and their same-day ACH
costs (even with the pass-through of the
interbank fee) may still be substantially
lower than the costs they would incur
using other payment methods, such as
wire transfers. Originators that wish to
avoid such potential costs can continue
to use existing lower-cost next-day ACH
options and the Federal Reserve has no
plans to eliminate its next-day ACH
settlement. The Board believes that a
higher interbank fee would likely result
in higher costs being passed to
originators and may reduce demand for

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Federal Register / Vol. 80, No. 187 / Monday, September 28, 2015 / Notices

same-day ACH services, resulting in a
ubiquitous but lesser-used service.23
The Board has not adopted the
suggestion to tier the fee to allow
smaller institutions to recover more
than the 5.2 cent fee because it does not
believe there is a clear correlation
between institution size and
implementation costs. As described
above, smaller RDFIs often outsource
their ACH and transaction account
processing, and may not incur costs as
material as those RDFIs that do not
outsource this processing.
The Board does not believe that the
interbank fee will rise over time, as has
been the experience in the card
industry. To address this concern,
NACHA proposed provisions that
provided for the potential reduction in
the fee, and adopted a rule to ensure
that the fee could not be increased in
the future. The Board recognizes that
NACHA members could vote to amend
NACHA’s operating rules to allow the
interbank fee to increase above 5.2
cents, but no such increase would apply
to FedACH same-day volume unless the
Board and the Reserve Banks (as ACH
operator) agree to such an increase.
NACHA’s amended operating rules
also include a 5-year review and 8-year
review of the fee. At each of these
reviews, if the volume of same-day
transactions exceeds the NACHA
projection by more than 25 percent, the
fee will be lowered to a level precalculated by NACHA and intended to
allow RDFIs achieve cost recovery on an
aggregate basis. A schedule of possible
fee decreases is available on the Board’s
Web site.24 If the fee is lowered as a
result of such reviews, the lower fee
amount establishes a new ceiling, above
which the interbank fee cannot rise. The
Board believes that the lower interbank
fee of 5.2 cents, combined with
regularly scheduled reviews to
determine any necessary reduction in
the fee in pre-calculated intervals, allow
cost recovery for RDFIs over time while
maintaining the attractiveness of the
same-day service to ODFIs and
originators.
Based on its review of these
comments, the Board has approved
enhancements to the Reserve Banks’
existing FedACH SameDay Service to
include an interbank fee paid by ODFIs
to RDFIs not to exceed 5.2 cents for each
forward same-day transaction and to
decrease that fee according to the fee
23 Four of the five commenters representing end
users supported adoption of the proposed
enhancements, including the interbank fee. This
support, however, was based on an interbank fee of
5.2 cents.
24 http://www.federalreserve.gov/
paymentsystems/fedach_about.htm.

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schedules published on the Board’s
public Web site in the event that sameday ACH volume exceeds projections by
more than 25 percent during one of the
regularly scheduled review periods.
Any other changes to the interbank fee
will require additional consideration
and action by the Board.
C. Other Topics Raised
The Board received comments on
several other topics related to
enhancements to the Reserve Banks’
existing FedACH SameDay Service.
(i) Processing Windows
Several commenters raised questions
about the processing and settlement
windows for same-day ACH
transactions. As noted above, one
commenter asked the Board to consider
a single morning submission and
afternoon settlement deadline, while
another commenter argued that
institutions outside the Eastern Time
Zone will only gain limited benefits
from same-day ACH. A third commenter
requested that the Board consider
extending its National Settlement
Service deadline to be inclusive of
business hours in all U.S. time zones.
The Reserve Banks are reviewing the
same-day ACH processing windows and
will work with NACHA and EPN to
establish processing schedules that are
convenient for as many institutions as
possible across the network. The Board
has also previously expressed its intent
to enhance the National Settlement
Service and will review extended
deadlines and potential enhancements
as described in the Strategies Paper.25
(ii) Fraud Risks
Several commenters noted an
increased potential for fraud with sameday ACH transactions related to shorter
processing windows. The Board
recognizes that same-day ACH
transactions may have a different risk
profile than existing next-day ACH
transactions. The Reserve Banks have in
place alert services that can assist RDFIs
25 As described in the Strategies Paper (1) the first
phase, which went into effect in January 2015,
expanded the operating hours of the National
Settlement Service by opening the settlement
window one hour earlier (at 7:30 a.m. ET) and
closing it one half-hour later (at 5:30 p.m. ET); (2)
the second phase, projected for year-end 2015, will
accelerate the opening time to coincide with the
9:00 p.m. ET opening of the Fedwire® Funds
Service (on the prior calendar date); (3) the third
phase, projected for 2016 or beyond, will explore
the technology, infrastructure and operational and
resource changes required to support weekend and/
or 24x7 operating hours. Federal Reserve System
(2015), ‘‘Strategies for Improving the U.S. Payment
System,’’ (Federal Reserve System, January),
fedpaymentsimprovement.org/wp-content/uploads/
strategies-improving-us-payment-system.pdf.

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in monitoring risk profiles specific to
same-day ACH transactions, and the
Board is aware that NACHA and the
regional payment associations have
already started reviewing risk
management issues related to same-day
ACH transactions. The Board believes
that any risks related to same-day ACH
can be appropriately mitigated by the
industry in collaboration with NACHA
and the ACH operators.
(iii) Continued Availability of Existing
ACH Capabilities
Several commenters expressed
concerns that the availability of sameday ACH services would lead to the
discontinuation or unnecessary
migration away from low-cost next-day
ACH services. The Board believes that
next-day ACH services will remain
relevant in light of likely continued
demand by end users for low cost and
efficient options for payments that do
not require same-day settlement or
processing, such as regularly scheduled
payroll files or bill payments. Retaining
next-day ACH service also reduces
operational risk by allowing ODFIs and
operators an opportunity to recover
from disruptions without delaying the
settlement of transactions.
The Federal Reserve has no plans to
discontinue next-day services, but it
cannot ensure that any given depository
institution would continue to offer nextday ACH origination services to its
customers. In a competitive marketplace
for deposit and payment services,
however, if a depository institution
were to stop offering next-day ACH
origination to its customers, the demand
for that service would likely be met by
other depository institutions.
The Board does not believe that
ODFIs will cease offering next-day ACH
origination in an effort to drive volume
to same-day ACH transactions, thus
increasing RDFI interbank fee revenue.
If that were to happen, same-day ACH
volume would far exceed the volume
expectations used in calculating the 5.2
cent interbank fee, which would result
in a reduction of the fee following the
regularly scheduled reviews. The Board
intends to monitor the adoption of
same-day ACH and the continued
availability of next-day ACH services.
The Board will reevaluate the amount
and appropriateness of any interbank
fee if low-cost next-day ACH origination
services are widely replaced by sameday ACH services, increasing costs to
originators.

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III. Criteria for Evaluating the Federal
Reserve’s Role in the Payment System

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A. New Services and Service
Enhancements
In considering new services and major
service enhancements to existing
Reserve Bank services, the Board
requires the following criteria be met:
the service must enable full long-run
recovery of costs by the Reserve Banks;
the service must yield a clear public
benefit; and the service must be one that
other providers alone cannot be
expected to provide with reasonable
effectiveness, scope, and equity.26
The Board believes that the
introduction of a FedACH same-day
service with mandatory participation by
RDFIs and an interbank fee meets these
criteria.27 The service will not adversely
affect the Reserve Banks’ ability to
recover the cost of providing the ACH
service over the long run as operating
costs can be recovered through fees
charged for using the Reserve Banks’
ACH services.28
The service also offers clear public
benefits. Same-day ACH capability will
facilitate the use of the ACH network for
certain time-critical payments,
accelerate final settlement, and improve
funds availability to payment recipients.
The Board believes that a ubiquitous
same-day ACH service would enhance
the efficiency of the ACH network and
the broader U.S. payment system by
providing a more efficient electronic
payment option for person-to-person
payments, expedited bill payments,
same-day payroll payments, and other
types of transactions. As several
commenters noted, this is consistent
with the strategic goals identified in the
Strategies Paper.29
26 See The Federal Reserve in the Payments
System (issued 1984; revised 1990), Federal Reserve
Regulatory Service 9–1557, http://
www.federalreserve.gov/paymentsystems/pfs_
frpaysys.htm. Clear public benefits include
promoting the integrity of the payments system,
improving the effectiveness of financial markets,
reducing the risk associated with payments and
securities-transfer services, or improving the
efficiency of the payments system. Id.
27 Although comment was not specifically
requested on whether adoption of the service
satisfied the Board’s criteria, several commenters
addressed the subject and all agreed with the
Board’s analysis that the criteria would be met.
28 The Reserve Banks intend to review current
FedACH SameDay Service fees to determine
whether any changes are appropriate as a result of
the enhancements.
29 The Strategies Paper communicates desired
outcomes for the payment system and outlines the
strategies the Federal Reserve will pursue, in
collaboration with stakeholders, to help the country
achieve these outcomes. One of the specific
strategies for improving the U.S. payment system in
the Strategies Paper is enhanced Reserve Bank
payment, settlement, and risk-management services
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The Board also believes that the
private sector cannot be expected to
provide the service alone with
reasonable effectiveness, scope, or
equity. Without incorporation of
NACHA’s amended operating rules by
the Reserve Banks, a viable same-day
ACH service would be unlikely.30
Without the ability to reach any RDFI in
the ACH network, the Board believes
that any same-day ACH service would
be ineffective and any corresponding
public benefits would be limited.
B. Competitive Impact Analysis
When considering changes to an
existing service, the Board also conducts
a competitive impact analysis to
determine whether there will be a direct
and material adverse effect on the
ability of other service providers to
compete effectively with the Federal
Reserve in providing similar services
due to differing legal powers or the
Federal Reserve’s dominant market
position deriving from such legal
differences.31 The Board believes that
there are no adverse effects to other
service providers resulting from
adoption of the amended operating
rules. The changes to the Reserve Banks’
existing service conform the service to
industry-wide ACH operating rules that
can be adopted by both ACH
operators.32 The changes are not the
result of any differing legal powers or
any dominant market position resulting
from legal differences.
IV. Conclusion
Based on its review of comments
received, the Board has approved
enhancements to the Reserve Banks’
FedACH SameDay Service that require
RDFIs to participate in the service and
ODFIs to pay a fee to RDFIs for each
same-day ACH forward transaction. The
enhancements will be adopted by
incorporation of NACHA’s amended
operating rules into Operating Circular
4, governing the Reserve Banks’ ACH
services.
capabilities. Federal Reserve System (2015),
‘‘Strategies for Improving the U.S. Payment
System,’’ (Federal Reserve System, January),
fedpaymentsimprovement.org/wp-content/uploads/
strategies-improving-us-payment-system.pdf.
30 This is evidenced by the limited adoption of
the Reserve Banks’ current optional FedACH
SameDay Service.
31 See The Federal Reserve in the Payments
System (issued 1984; revised 1990), Federal Reserve
Regulatory Service 9–1558, http://
www.federalreserve.gov/paymentsystems/pfs_
frpaysys.htm.
32 TCH, owner of EPN, indicated its strong
support for the enhancements in two separate
comments submitted to the Board.

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58253

By order of the Board of Governors of the
Federal Reserve System, September 23, 2015.
Robert deV. Frierson,
Secretary of the Board.
[FR Doc. 2015–24551 Filed 9–25–15; 8:45 am]
BILLING CODE 6210–01–P

DEPARTMENT OF DEFENSE
GENERAL SERVICES
ADMINISTRATION
NATIONAL AERONAUTICS AND
SPACE ADMINISTRATION
[Docket 2015–0055; Sequence 16; OMB
Control No. 9000–0107]

Information Collection; Notice of
Radioactive Materials
Department of Defense (DOD),
General Services Administration (GSA),
and National Aeronautics and Space
Administration (NASA).
ACTION: Notice of request for comments
regarding the extension of a previously
existing OMB clearance.
AGENCY:

Under the provisions of the
Paperwork Reduction Act, the
Regulatory Secretariat Division will be
submitting to the Office of Management
and Budget (OMB) a request to review
and approve an extension of a
previously approved information
collection requirement concerning
Notice of Radioactive Materials.
DATES: Submit comments on or before
November 27, 2015.
ADDRESSES: Submit comments
identified by Information Collection
9000–0107, Notice of Radioactive
Materials, by any of the following
methods:
• Regulations.gov: http://
www.regulations.gov.
Submit comments via the Federal
eRulemaking portal by searching the
OMB control number. Select the link
‘‘Submit a Comment’’ that corresponds
with ‘‘Information Collection 9000–
0107, Notice of Radioactive Materials’’.
Follow the instructions provided at the
‘‘Submit a Comment’’ screen. Please
include your name, company name (if
any), and ‘‘Information Collection 9000–
0107, Notice of Radioactive Materials’’
on your attached document.
• Mail: General Services
Administration, Regulatory Secretariat
Division (MVCB), 1800 F Street NW.,
Washington, DC 20405. ATTN: Ms.
Flowers/IC 9000–0107, Notice of
Radioactive Materials.
Instructions: Please submit comments
only and cite Information Collection
9000–0107, Notice of Radioactive
SUMMARY:

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