Creating the Nacha Rules is a ‘Democratic Process’

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If you're of a certain age and spent Saturday mornings in front of the TV, you probably remember "I'm Just a Bill" from "Schoolhouse Rock!" explaining how bills become laws. While there's no equivalent cartoon for how the Nacha Operating Rules are made, Cari Conahan believes that classic isn't far off.

"We have a similar process," said Conahan, Nacha Associate Managing Director, ACH Network Rules and Enforcement. For those unfamiliar with it, Conahan helped to explain "The Nacha Operating Rules: What Are They and Why Are They Important to You?" at Smarter Faster Payments Remote Connect 2025.

"The first step is idea submission," said Conahan, stressing this is not elitist. "Anybody who's got an idea, or a need, or has identified a shortcoming in the Rules, is in a position to make a recommendation that there be a change to the Rules. It's that open."

Proposals are presented to Nacha's Rules and Operations Committee, whose members represent financial institutions, Payments Associations, the ACH Operators, the U.S. Treasury, the Federal Reserve, and end users. With input from the technical community, the panel reviews suggestions, and if they decide to proceed, a Request for Comment is developed.

"That is open to the entire world, so anyone who has interest or a stake in the topic is welcome to provide feedback," said Conahan. "Not everyone has the same perspective. You don't identify all the issues through the same channels."

The committee reviews all comments and if there's sufficient support a ballot is issued to Nacha voting members. If approved, Conahan said, "Nacha will develop a variety of educational initiatives with our Payments Association partners to increase awareness."

That includes Wespay, where Jim Petkovits, Vice President, Education and Events, said the inclusiveness helps set the ACH Network apart.

"Different than other payment networks, is the democracy, I suppose, of the ACH Network that allows us all to work together to make sure that we have a network that works for everybody," said Petkovits.

"These Rules are democratic. They're written by the participants," said Petkovits. "It's a network that's created and established by the participants themselves, so when we see something in the Rules that need to be corrected, there are paths to do this."

Given the importance of following the Rules, Nacha has several resources, including the ACH Guide for Developers created by Nacha's Payments Innovation Alliance. Danita Tyrrell, Nacha Senior Director, ACH Network Rules Development and Technical Support, called it "a great way to quickly familiarize yourself with how to build an ACH file."

"This is a handy reference tool," said Tyrrell, noting the guide includes references back to the Nacha Rules.

"That person who's been asked to create a Nacha file and doesn't know where to start, doesn't understand ACH, can use this tool," said Tyrrell. "It includes some of the basic ACH information-the parties, how the transaction moves through the network-and it provides a lot of information on the specifications."

The 2025 Nacha Operating Rules and Guidelines are available in the Nacha Store.

Have a Rules question? Submit it to Nacha.