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for 13.5 percent, and consumer bill In addition, a movement is underway toward fully electronic checks, more
payments were 2 percent of the total, commonly known as electronic payment orders, or electronically created
NACHA reported. items (ECIs). Walker said his calculations suggest businesses could amass $29
billion a year in savings by converting existing B2B paper checks to ECIs. "This
"In its first three months of operation, would have a huge impact on the business community," Walker said. Several
same-day ACH has proven that it is a companies, and a few large banks, offer businesses services that emulate ECIs,
valuable faster payment solution for a although currently no laws or regulations address these items, he added.
variety of users, including business-
es, consumers and financial institu- In August 2016, Bank of America established a partnership with upstart
tions," said Janet O. Estep, President Viewpost IP Holdings LLC to support electronic initiation of checks and
and CEO of NACHA. related remittance documents by the bank's more than 3 million small business
customers. Viewpost prints instructions in conformance with industry and
Under a plan set out by NACHA in regulatory requirements and submits the electronic files for clearing. Most
2015, same-day ACH applies now items are presented and cleared within a day. Remittance documents are
only to credit transactions, like direct delivered through electronic interfaces Viewpost has established with major
deposit. Same-day ACH settlement of accounting systems. "We see memo-posting [of check payments] within an
debit transactions (for example, con- hour," said Pat McMonagle, Viewpost Executive Vice President, Director of
sumer bill payments) will begin in Payment Operations.
September 2017. While ACH debits
have appeal for consumers (think au- The pursuit is real
tomated bill payments) they are less The appeal of real-time payments cannot be denied. "Real-time payments can
attractive to corporations, as control benefit financial institutions, merchants, consumers and society by offering
of ACH origination is in the hands of enhanced visibility into payments, by enabling better cash management and
payees. by helping businesses better manage day-to-day operations by improving
ACH debits, credits liquidity," the consultancy Deloitte wrote in a recent report, Real-time payments
differ significantly are changing the reality of payments. "The liquidity improvement can be especially
"There are important differences be-
tween [ACH] debits and credit," said
David Walker, President and CEO of
ECCHO, the industry rules group for
image check exchanges. Businesses
are averse to providing checking ac-
count details to trading partners,
which is necessary, as ACH debits are
initiated by recipients (payees). Also,
most B2B payments are accompanied
by detailed invoice information that
cannot be accommodated by ACH
addenda record formats.
Bottom line: corporate accounts pay-
able and receivables processes and
systems have evolved around check
payments; switching payments from
checks to the ACH, or another net-
work, would demand major systems
overhauls. "That's not an insignifi-
cant cost," Walker said.

Walker believes banks would be bet-
ter served by making the check pay-
ment system more electronic. Nearly
all checks today clear through the
banking system as electronic files –
over 99 percent, according to the Fed.
Also increasing numbers of checks
are being deposited via RDC (using
PCs, tablets and smartphones).
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