The ACH Recorded 9% Growth in the September Quarter Even Though Covid Aid Trailed off

The nation’s automated clearing house network surged again in the September quarter, even with a waning of federal-assistance payments. Volume grew by double-digit percentage increases in most major categories as the network handled 6.8 billion transactions overall, up 9%, Nacha reported Tuesday. Nacha is the governing body for the network, which connects virtually every financial institution in the country.

The third-quarter increase in total volume exceeded even the 7.9% growth registered in the June quarter, some of which was due to the use of the network to distribute federal relief in the wake of the Covid-19 pandemic. 

Nacha credits “a resurgence of commercial volume” in the latest quarter for more than offsetting the end of the pandemic-relief efforts. The dollar value of the third-quarter volume came to $15.9 trillion, up 13.1% year-over-year.

Nacha notes, however, that there was one additional banking day in the latest quarter compared to the same period in 2019. On a per-day basis, network transactions were up 7.3% year-over-year, the organization says.

The latest results also continue to trace an ongoing decline in checks. Check conversions dropped fully 24% in the quarter, the second consecutive period the have fallen that much. Conversions allow paper checks to be processed as electronic transactions on the ACH. The double-digit decline is part of a trend. Nacha cites numbers from the Federal Reserve indicating the volume of commercial checks it collected in the second quarter dropped 10.7%, the biggest percentage decline since the first three months of 1994.

Volume for same-day ACH came to 93.9 million transactions, up 41%. Following a March increase in the dollar cap for these transactions to $100,000, the average transaction rose 31% in the latest quarter. A form of faster payments, same-day ACH embraces both credits and debits and allows transactions to be processed on the day they are initiated.

Other ACH categories also enjoyed robust growth in the quarter. Peer-to-peer transactions were up 52% to 59 million, while business-to-business volume grew 12.4% to 1.1 billion. Transactions on the Internet increased nearly 14% to 1.9 billion.