The only rule updates for 2023 pertain exclusively to micro-entries. Micro-Entries are used by Originators (merchants) as a means of account validation. Specifically, it’s where the Originator credits the Receiver (customer/end-user) some random amount of money and than asks the Receiver to validate the amounts. Nacha has provided a rule update for Micro-Entries which was rolled out in two phases.
Phase 1 of the Micro-Entry Rule took effect on September 16, 2022. This phase defined Micro-Entries as ACH credits of less than $1, and any offsetting debits, for account validation. Additionally, this phase required the standardization of the following field:
Company Name - This field must be easily recognizable and the same or similar to what will be used in subsequent entries.
Company Entry Description - This field must be set to “ACCTVERIFY”
Phase 2 the Micro-Entries Rule update will be in effect as of March 17, 2023. This phase requires Originators of Micro-Entries to use “commercially reasonable” fraud detection. This is intended to reduce and deter fraud schemes that can occur with the use of Micro-Entries.
Unlike the WEB Debit account validation rule which requires account number validation, the Micro-Entry rule does not require the account number to be validated or that each entry be reviewed. Instead, this rule requires Originators to monitor forward and return volumes to determine a standard for Micro-Entry activity.
As phase 2 of the rule focuses on fraud detection, Originators should consider the following items when monitoring Micro-Entry activity:
Velocity of Micro-Entries
Frequency of account numbers utilized in Micro-Entries
Variation of account numbers utilized in Micro-Entries
An important resource for monitoring origination and return activity for Originators and Third-Party Senders can be found in Article Two, Subsection 2.2.3 of the Rules.