Vital Fed payment system experiences second delay of 2019
The Federal Reserve is investigating the second significant disruption in 2019 of a payments service administered by the U.S. central bank.
Certain bank transactions were delayed after ACH -- which stands for the automated clearinghouse system -- experienced delays but it is now up and running.
“The FedACH service, which processes transactions for commercial banks, is currently operating normally after experiencing delays in processing yesterday afternoon and early this morning,” Jean Tate, a spokeswoman at the Atlanta Fed, said in an e-mailed statement. “Some customers experienced delays in receiving confirmations of yesterday’s transactions. Federal Reserve technical staff continue to investigate the root cause of the issue.”
The Atlanta Fed hosts the central bank’s Retail Payments Office, processing ACH transactions.
ACH is a national system that processes batches of electronic funds transfers such as payroll, social security benefits, tax refunds, corporate payments to vendors and utility payments, according to the Fed’s website. The commercial service handled 58.5 million transactions a day on average in 2018 with an average value of $1,760.
Earlier on Thursday several banks tweeted that they were experiencing issues.
“We’re monitoring the situation closely in partnership w/ the Fed,” Capital One tweeted. “As soon as they’ve resolved the issue we’ll work to make sure all transactions are posted as quickly as possible.”
A Fed website dedicated to the central bank’s payments processing services posted a notification at 9:57 a.m. New York time on Thursday saying “the FedACH Services application began experiencing a disruption on December 18 at 3:30 p.m.” on Wednesday.
“Payment files and acknowledgments are flowing as of 7:40 a.m. on December 19,” it said. “Federal Reserve Bank technical staff continue to investigate the issue.”
Spokespersons at the Fed’s Washington headquarters didn’t immediately respond to request for comment on the issue.
This marks the second disruption to a Fed-run payments service this year. On April 1 the FedWire interbank funds transfer service went down for about three hours. The Fed blamed the outage on “an internal technical issue,” but declined to provide more details.
Bloomberg News sought additional information about that outage under the Freedom of Information Act, but the request and a subsequent appeal were denied by the Board of Governors.