Financial Update (October-December 1996)
Fed Cuts Prices for Electronic Payments Services
Reduced Fed prices could save the banking industry as much as $18 million next year.
he Federal Reserve recently announced 1997 fee schedules that present lower prices for electronic transactions, including automated clearinghouse (ACH) payments. The Fed estimates that the price reductions will save the banking industry $11.3 million over the next year, including $8.9 million in reduced fees for Fedwire transfers and $2.4 million for ACH payments.
The price reductions became effective Jan. 2, 1997. "The dividend achieved for the industry as a result of our consolidation of electronic payments totals $18.4 million when you combine the $11.3 million in reductions announced today with the $7.1 million that will result from the ACH price reductions we implemented on Oct. 1, 1996," said Paul M. Connolly, first vice president of the Federal Reserve Bank of Boston and product director for the Federal Reserve Banks' retail payments services.
The highlights of specific changes for 1997 include
Connolly also said the Fed ACH software includes an array of new features. "These include file delivery to separate locations at different frequencies, on-line file or item trace requests, routing of an ACH report to different locations, individual routing of transaction types to different receiving points, and on-line access to a nationwide directory of depository institutions that participate in the commercial ACH service."
- a 10 percent reduction in the basic funds transfer fee, from 50 cents to 45 cents;
- a 50 percent reduction in the ACH premium surcharge, from 1 cent to 0.5 cent;
- a 25 percent reduction in the fee for addenda records to ACH transactions, from 0.4 cent to 0.3 cent.