Small Bank, Big Influence: North American Banking Co. Joins Nacha’s Ranks of Direct Members

Every so often, evidence emerges that size is not necessarily linked to influence. Nacha, the governing body for the nation’s automated clearing house network, on Tuesday announced that North American Banking Co. has joined the ranks of direct members of the association. Direct members constitute a group of more than 40 financial institutions and payments associations that influence the direction of the ACH.

What makes the appointment stand out is North American’s size. At just over $900 million in assets, the Roseville, Minn.-based institution is by far the smallest of the now 33 financial institutions that are part of the group. That distinction had rested with First Premier Bank, Sioux Falls, S.D., which manages $3.1 billion in assets. Other members include banking giants like JPMorgan Chase, Bank of America, and Citibank.

North American joins a panel that influences the shape of the nation’s automated clearing house network. Direct members, for example, vote on proposed network rules as well as proposed appointments to its board of directors.

“North American Banking Co. looks forward to working with others focused on the future of the ACH network and to enhance the ACH network’s offerings to meet the evolving needs of the payments industry,” said Michael Bilski, the institution’s chairman and chief executive, in a statement. Speaking to Digital Transactions News, he adds, “We’re a little bank out there trying to compete. We we wanted to make sure we had a voice.”

Bilski is no stranger to the world of payments. One of his most prominent roles is his service as chairman of the U.S. Faster Payments Council, an industry group formed by the Federal Reserve in November 2018. The council includes members from a diverse array of industries, including retailers, payment networks, technology companies, and consumer organizations as well as financial institutions. It grew out of the Governance Framework Formation Team, which itself was the successor to a multi-year effort by the Fed to jumpstart the launch of real-time or near-real-time payments networks in the United States.

Now North American will enjoy wider sway in the world of ACH processing. “North American Banking Co. joins an elite group that shapes and influences the governance and direction of the modern ACH network and the Nacha operating rules,” said Jane Larimer, Nacha’s chief executive and president, in a statement.