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New ACH File Delivery Window Coming in September

Source: Wespay

Both the Federal Reserve and The Clearing House recently announced the planned implementation of an additional ACH file delivery (window) to each of their daily processing schedules starting mid-September 2022. The new window will allow Originating Depository Financial Institutions (ODFIs) to send a file to their ACH Operator at 10:45 pm ET/7:45 pm PT/4:45 pm HT. Receiving Depository Financial Institutions (RDFIs) can opt-in to receive this file approximately 45 minutes later at 11:30 pm ET/8:30 pm PT/5:30 pm HT.

The ACH Operators are implementing this new window to accelerate the delivery of evening ACH activity and provide RDFIs with the option to process these files when received to better reflect customer account balances over a full-day cycle or weekend (in the case of Friday night files).

Wespay has provided answers to some of the key facts related to this new window below:

Is my financial institution requied to participate in this new ACH processing window?
No. This new window is completely voluntary for both ODFIs and RDFIs to participate in.

Why would my FI want to consider updating its collection schedule to receive a file out of this new ACH window?
RDFIs would be able to reflect customer account balances for received ACH transactional activity that will settle the following morning. This may be most advantageous on Friday nights/Saturday mornings, where RDFIs would be able to provide their accountholders visibility over the weekend to ACH activity that will post to their account on Monday morning.

RDFIs that have opted to post credits early would be able to make the ACH credits received in this new window available to its accountholders the evening this new file is received as opposed to the following morning when these transactions are currently made available.

For ODFIs, participating in this new window is a way to demonstrate to Originators that it is processing originated entries as fast as possible, enabling expedited visibility to their entries as described above

Are Same Day ACH Entries included in this new window?
No. This new ACH window will NOT include Same Day ACH entries. The entries in this file will contain all ACH payments that the ACH Operators have received since the previous ACH window, including:

  • 1-day debits and credits, scheduled to settle at 8:30 am ET/5:30 am PT/2:30 am HT on the next banking day
  • 2-day ACH credits, scheduled to settle at 8:30 am ET/5:30 am PT/2:30 am HT on the second banking day following the current banking day
  • ACH return entries
  • U.S Treasury payments

When will the ACH Operators schedule inter-bank settlement for this new window?
This new schedule only involves the delivery of the ACH entries themselves. There will not be an additional inter-bank settlement window. The ACH Operators will settle the volume in this new window on the following banking dayat 8:30 am ET/5:30 am PT/2:30 am HT.

When will the ACH Operators implement this new window?
The Federal Reserve will begin the new file delivery schedule on Monday, September 12, 2022 and The Clearing House will begin on Friday, September 16, 2022.


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For many bank employees, remote work is here to stay

Written by Laura Alix from the American Banker

The percentage of U.S bank employees who work at least partially from home nearly doubled over the past year, and more than half of the industry’s workers want to keep performing job duties remotely.

At the same time, more than seven out of 10 bank staffers believe that their employer is likely to allow some workplace flexibility going forward.

Those are some of the key findings from a recent survey of industry professionals that was conducted by Arizent, the parent company of American Banker.

The results show how the extraordinary circumstances of the last 15 months have changed many employees’ attitudes about working from home, leading many of them to place more value on remote arrangements, and how their evolving attitudes will have long-term ripple effects on how banks configure their workforces.

As the industry begins to bring workers back to the office, many firms are keeping at least some of the flexibility that they adopted last year out of necessity.

“One lesson we learned from the pandemic is that offering flexibility and support programs leads to a more productive, engaged workforce,” Claudine Hoverson, Synchrony Financial’s chief talent strategy officer, said in an email. “Permanent work flexibility has become central to our new way of working.”

Some financial institutions are considering hybrid work models, and a few have decided to offer all of their employees the option to work remotely. In interviews and emails, some bank executives described bringing employees back in phases and said they anticipate greater adjustability in the workplace of the future.

Stamford, Connecticut-based Synchronyannounced in September 2020that it would offer any employee who wants it the option to continue working remotely after the pandemic. “You all have proven that we can make work at home, work. And many employees have asked for more flexibility to do so full time,” then-CEO Margaret Keane wrote in a memo to employees.

Still, not everyone wants to work from home, and Synchrony is now in the initial phase of its return-to-office pilot. So far, about 200 employees have returned to four locations, and that number is expected to grow through the summer and fall, according to Hoverson.

Ally Financial is among the banks that are considering hybrid models.

In February, the Detroit-based company started bringing employees back to the office, opening eight of its 23 worksites to roughly 145 employees who volunteered to return. Childcare was a major challenge, according to Chief Human Resources Officer Kathie Patterson, who said that it was difficult at that time for many workers to commit to being in the office on certain days.

The $182 billion-asset Ally now anticipates that most of its workforce will be back in the office after Labor Day. Employees are being encouraged to return over the summer at their own pace, so they have time to establish new routines, Patterson said.

“The expectation when we go back is th at we will move towards a hybrid schedule, but we’re still determining what that means for us, and we want to be really intentional about it,” she said.

Ally has also reconfigured some roles, including software developers and cyber and data engineering functions, to allow workers in those jobs to go fully remote.

Other banks appear to have less certainty about what their post-pandemic policies will look like. Some banks declined to discuss their return-to-office plans when contacted by American Banker, citing uncertainty, disagreements or ongoing planning.

Meanwhile, certain banks seem eager to bring their workers back to the office full time.

Some functions simply need to be performed in person, or at least are done much better in person, executives at these banks note. What’s more, many employees actually prefer to work in the office – maybe because they dislike the isolation of remote work, or perhaps because their homes aren’t conducive to productivity.

Goldman Sachs called almost all of its New York employees back to their desks this week, while JPMorgan Chase has told its U.S. employees to be prepared to return to the office next month. Citigroup expects about 30% of its U.S. employees to return to the office this summer.

Bank of America Chairman and CEO Brian Moynihan recently told Bloomberg Television that the Charlotte, North Carolina-based company plans to bring back all of its vaccinated workers after Labor Day. He said that so far, over 70,000 employees have voluntarily disclosed their vaccination status.

“We are a work-from-office company,” Moynihan said at BofA’s annual meeting in April. “We have always had a work-from-home program, but it requires great discipline to execute on that appropriately.”

The benefits and downsides of flexibility

Among bank employees who responded to Arizent’s survey, 43% said they worked from home at least some of the time before the pandemic. That figure jumped to 85% over the past year, with 55% of bank employees saying they’d like to keep working from home some of the time in the future. Some 71% of respondents said that their bank is very likely or somewhat likely to allow remote work options in the future.

The online survey of 491 employees and employers was conducted in April. (American Banker subscribers can read the full reporthere.)

The findings suggest that as banks vie for talent, some of the most competitive workplaces will likely be those that offer their employees some autonomy and flexibility in how they get the job done. The pandemic demonstrated that many jobs can be performed well in a remote setting if the right resources and support are in place.

Workplace flexibility can also help companies build a more diverse and inclusive workforce, said Malia Lazu, CEO and founder of The Urban Labs in Boston. Flexible work policies can be especially beneficial for people with disabilities, an often-overlooked demographic, according to Lazu, who consults with real estate and financial services firms.

“When it comes to transportation and when it comes to the realities of navigating this world, for someone who’s differently abled … this is a win,” she said.

Proponents of flexible work also note that 2020 was an exceptionally stressful year even for the most fortunate Americans. Working from home will likely look and feel a bit different when parents are not scrambling for consistent child care.

“This wasn’t just a grand experiment in virtual work. This was a grand experiment in telecommuting during a pandemic,” said Manar Morales, president and CEO of the Diversity and Flexibility Alliance, a coalition of organizations dedicated to sharing best practices for workplace flexibility.

Another factor that could motivate some firms to allow greater flexibility is that having a smaller physical footprint results in cost savings.

In the Arizent survey, 29% of respondents across the broader financial services sector said that their companies expect to downsize as a result of increased remote work. Those respondents cited employee feedback and reduced costs as their two main reasons for doing so.

The survey also found that banks are lagging behind some other parts of the financial services industry in switching to remote work. Some 43% of survey respondents at banks said that they worked from home all or some of the time before the start of the pandemic, which compared with 71% at fintechs.

In the future, 55% of the bank respondents said they would like to work from home all or most of the time if their employer offered that option, compared with 86% at fintechs.

Across all survey respondents, which included professionals in the financial services industry and related fields, 43% said that they were very interested in working from home at least some of the time, and 19% said that they were somewhat interested.

Consistency could prove to be a challenge for companies that are exploring a hybrid work environment. Some 33% of the people surveyed by Arizent said that their companies had no set expectations for how those employees will divide their time between the office and remote work.

Organizations that want to offer their employees flexibility need to define what that means and clearly communicate those expectations from the beginning, experts said.

Sometimes flexibility includes remote work, but it might also mean being able to adjust work hours around other obligations. Or, for people easing back into the workforce after a hiatus, flexibility might mean starting with a part-time role.

However flexibility is defined, the business case for granting more leeway to employees is largely a talent play. Not only is greater flexibility a draw for potential hires, it also gives existing workers a measure of autonomy and trust in how they do their jobs.

“Even more than working from home, what [employees] have liked is the trust they feel they have gained,” said Mariemi Sierra Alvarez, chief of our people at Banco Popular in San Juan, Puerto Rico. “You don’t necessarily have to see me 24/7 to know that I’m doing my job.”

Managing employees in a remote or partially remote environment has its own unique challenges and demands.

TD Bank has brought “very, very few roles” back into the office so far, said Ryan Pritchard, the bank’s head of U.S. talent management and executive development. While some jobs, including those in branches, will always need to be done in-person, TD Bank is turning some roles into hybrids, he said.

In order to make the hybrid environment work, the $411 billion-asset company is trying to figure out how to provide internal networking opportunities for hybrid and remote workers. It is also encouraging managers to adapt to that new setting by communicating more frequently with their employees and through a variety of channels.

“Our leaders need to lead differently in a hybrid environment,” Pritchard said. “Leaders need to lead with empathy and be really clear about priorities and make sure they’re communicating effectively and not just through email.”

It is not uncommon to hear bankers and other corporate leaders express concern about the fate of their workplace cultures in hybrids or remote settings. That is a valid concern, Lazu said, but companies have a number of platforms they can use to connect with employees and build a corporate culture. Executives can also look to their own workforces for ideas about how to build a culture in a hybrid work environment, she said.

“Your 40-and-younger set is where you’re going to find a natural understanding of how to build culture online,” she said.