STRATEGIC PARTNERS
March 4, 2002
Herndon, VA -- The Board of Directors of NACHA - The Electronic Payments Association has approved a reorganization of the association, which is intended to streamline the governance of the group, establish new voting rights for fin ancial institutions on the operating rules for the Automated Clearing House (ACH) Network and establish direct membership in NACHA for financial institutions.
"With financial institution mergers and the proliferation of new payment technologies and service providers, a new organizational structure at NACHA is required in order to meet the needs of our members, remain responsive to the industry, and prepare the payments system for the future," said Kevin O'Brien, chairman of NACHA and executive vice president of Chase Bank of Texas.
As part of the reorganization:
A new Board of Directors that is more representative of the entire membership will be constituted. The new Board will include 19 directors, with 10 directors representing payments associations (at least one will be an employee of a credit union and at least one will be an employee of a community bank); five directors representing financial institution members; and four representing NACHA's industry councils (at least one will represent NACHA's Affiliate Membership Program). The president of NACHA and the immediate past chair of the Board will be non-voting members. The current Board consists of 38 directors.
Membership
Direct membership in NACHA will be opened to depository financial institutions. Membership in NACHA's industry councils will remain open to any interested organization.
Operating rules
Direct financial institution members and payment-association members and their financial institution members will be eligible to vote on NACHA's operating rules. A depository financial institution that is a member of a payments association will have the option to vote directly on the rules or to have the payments association vote on its behalf. The new voting procedure is expected to take effect in 2001. Currently, NACHA's Board of Directors votes on the rules.
The changes become effective immediately. A 90-day transition plan has been approved to implement the changes.
