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BreadcrumbResourcesACH: A guide to bank debit in the US

Customer payment notifications (when are they required?)

There are two factors that determine when notifications are required, and there are rules governing when these notifications must be delivered.

Notifying your customer about an ACH debit payment is required when there are changes to either:

  • Payment frequency, or

  • Payment amount

What constitutes a change depends on what the original debit authorization specified.

In cases where you need to take payments that vary in frequency or amount, you’ll need to give your customers advanced notice before any money leaves their account. Nacha rules suggest:

  • 10 calendar days in advance if the payment amount changes from the previously taken amount, or if it exceeds the maximum value that the customer has previously agreed on

  • 7 calendar days in advance for a change in date (unless the change is due to a weekend or holiday)

However, it is within a business’ rights, and often in the customer’s interest, to use alternative timings. Alternative timings, however, must be explicitly agreed to by the customer during the set up of the authorization.

Customer payment notifications and GoCardless

If you use GoCardless as your TPPP, our bank-approved, fully compliant authorization forms are balanced to best meet the needs of both your business and your customers. The customer payment notification timings are:

  • 2 calendar days in advance if the payment amount changes from the previously taken amount, or if it exceeds the maximum value that the customer has previously agreed on

  • 2 calendar days in advance for a change in date (unless the change is due to a weekend or holiday)

You can find out more about collecting ACH debit with GoCardless in Chapter 4.

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