About Narmi AO ACH Service

Narmi AO ACH Service is a direct way to collect the funding requests in Narmi, which are generated as NACHA files for your institution to submit through your existing ACH process. By handling funding requests independently in Narmi, we empower your institution to have more control over your ACH funding and unlock deposit growth. This complete control over ACH funding allows you to set your own limits, monitor transactions, and process easily. Managing ACH transactions is simple with AO ACH Manager in the Admin Platform. Narmi AO ACH Service empowers compliant transactions and is built for scale. Narmi has partnered with instant account verification and account validation providers so that every transaction goes through a validation process. 

AO ACH Funding Flow 

If the account is funded via Narmi AO ACH Service, the following flow applies: 

1. The applicant selects Link an external bank account on the funding page of the application.
   
2. The applicant can select one of the following account verification options: 
   • Instant account verification (IAV) – Option to Automatically Add an account by entering their banking credentials 
   • Manual account validation – Option to Manually Add an account by entering their routing number and account number
     Go to Account Validation below for more information.
3. The applicant submits their application. 
4. Once the applicant passes identity decisioning, we then run a check on their funding information.
   • If the applicant selected IAV and successfully connected their bank information, they will be notified in the Account Opening flow if their application was approved.
   • If the applicant selected manual account validation, the transaction is sent to Microbilt for evaluation. Go to Account Validation below for details.
5. If the transaction is accepted by MX/Microbilt, or manually accepted in AO ACH Manager by your staff, it gets included in the NACHA file that Narmi generates. This is a NACHA file specific to Account Opening that we generate the same way as the Digital Banking NACHA file. There is one file for Account Opening and one file for Digital Banking. The Account Opening file includes entries for consumers and businesses, but they will be in separate batches as long as the SEC codes are different.
6. Narmi sends the NACHA file to your institution via SFTP or API.
7. Your financial institution receives the NACHA file and is responsible for submitting it to the Federal Reserve for processing.
8. Funds are released after your institution's hold period ends.

Account Validation

Every ACH funding transaction will go through one of two validation/verification options, and it varies by how the account information was provided during funding: 

1. Instant account verification (IAV) – If the applicant provides their account using IAV, this verification occurs during the applicant flow using our partner MX. These transactions will automatically go into "Pending" status. No further action is needed for transactions in Pending as they are waiting for the next ACH cutoff time.
2. Manual account validation – If the applicant manually enters their account information, this validation occurs after the applicant passes identity decisioning. We check the account details with our partner Microbilt and they will return one of the following statuses:
   • Accept – The transaction moves to "Pending" in the AO ACH Manager
   • Warning – The transaction moves to "Review" in the AO ACH Manager
   • Decline – The transaction moves to "Review" or "Reject" in AO ACH Manager according to your institution's settings. Go to Narmi AO ACH Service Configuration for more information.
     For transactions that return Warning and Decline, staff users will have to decide whether to approve or reject them. If a transaction is rejected and the applicant has funding attempts remaining, they receive an email prompting them to re-enter their funding information. Doing so will trigger a new transaction. If a transaction is rejected and the applicant has no remaining funding attempts, their application is rejected and they receive an email notification. To configure funding attempts, go to Narmi AO ACH Service Configuration.
     An account can return a Warning or Decline in situations such as:
   • It has been reported closed in the past
   • There is a history of returns
   • The account does not look like other accounts for that routing number

For more information on how Narmi handles ACH transactions, including cut-off times, go to About ACH Transactions.