Understanding NACHA’s 2026 rule amendments — and how Alloy helps financial institutions prepare

A new era of fraud monitoring and transparency in the ACH network

The ACH network, operated by NACHA, moves trillions of dollars every year — powering payroll deposits, online purchases, and countless other payments that flow quietly behind the scenes. On March 20, 2026, NACHA will introduce major updates to its Operating Rules to make those payments more secure, transparent, and fraud-resistant.

At Alloy, we already help financial institutions and fintechs automate compliance and detect fraud across ACH and other payment channels. Let’s take a look at what’s changing with the new rules and how Alloy can help your institution prepare for these changes and stay ahead of compliance and fraud risk.

Why is NACHA updating the rules?

The short answer: NACHA is taking aim at ACH payment fraud.

The new amendments aim to reduce fraud across ACH transactions by ensuring every participant — from Originating Depository Financial Institutions (ODFIs) to Receiving Depository Financial Institutions (RDFIs) — actively monitors for suspicious activity.

Historically, NACHA required monitoring only for certain types of debit transactions (like consumer WEB debits). With fraud and scams on the rise, NACHA’s new language goes further by mandating a risk-based, holistic approach that covers credits, debits, and including transactions authorized under false pretenses.

In other words, financial institutions must move from “reactive” to proactive fraud detection.

What’s changing with NACHA’s 2026 rule amendments?

1. Fraud monitoring by ODFIs

ODFIs and their partners must:

• Establish risk-based processes and procedures to identify entries suspected of being initiated due to fraud, including unauthorized or authorized under false pretenses (e.g., business email compromise or vendor impersonation).
• Review and update these processes at least annually to adapt to evolving fraud trends.

When suspicious entries are suspected, financial institutions should refer to NACHA Advisory Group Guidance, and take actions including but not limited to: stop processing, discuss with internal monitoring teams, contact the receiving institution (RDFI) including to request a return of funds.

2. ACH credit monitoring by RDFIs

NACHA has also reshaped the amendment for receiving depository institutions to enhance their monitoring of incoming credit entries.

The amendment requires RDFIs to ensure they have risk processes and procedures in place to identify fraudulent credit entries. 

A risk-based approach to monitoring of incoming ACH credit entries might include considering factors such as account age, balance history, transaction velocity, and behavioral anomalies, and treatingdormant or new accounts, as well as high-dollar or rapid-repeat credits, as higher-risk accounts.

3. Clearer payment labels by originators

All originators (companies or payment processors) must use the following new descriptions in the Company Entry Description field:

• Use PAYROLL for wage and compensation payments (PPD credits).
• Use PURCHASE for e-commerce debit transactions (WEB debits).

These uniform descriptions make it easier for financial institutions and account holders to recognize legitimate transactions — and spot unusual, mislabeled, or fraudulent ones. For example, the PAYROLL description can help enable RDFIs to better monitor for fraud involving payroll redirections. 

What does “authorized by false pretenses” mean?

The rule amendments introduce a new defined term, “False Pretenses”, which includes “the inducement of a payment by a Person misrepresenting (a) that Person’s identity, (b) that Person’s association with or authority to act on behalf of another Person, or (c) the ownership of an account to be credited.” Importantly, this definition addresses fraud types beyond unauthorized access.

It covers cases where a customer was tricked into authorizing a fraudulent payment, such as:

• Business email compromise scams
• Vendor impersonation
• Payroll fraud
• Mule activity

As social engineering and scam-based fraud continue to increase, NACHA is taking action to address payments made “under false pretenses.”

When do the new NACHA rules take effect?

How can Alloy help financial institutions stay compliant with NACHA regulations?

Alloy’s identity and fraud prevention platform is uniquely positioned to help ODFIs, RDFIs, and originators meet these new regulations.

Counterparty account verification

NACHA highlights account validation as a best practice. Through Alloy’s comprehensive network of third-party solution partners, clients can easily integrate account validation and access services as part of their ODFI risk-based monitoring strategy.

Risk profiling and machine learning models

Alloy clients can build risk profiles for each of their customers to track the customer’s ongoing risk throughout their lifecycle. Alloy’s proprietary machine learning model captures ACH transfer behavior and return data to assess transaction-level and user-level risk — helping institutions identify patterns that signal potential fraud.

Velocity and behavioral monitoring

Financial institutions can use Alloy to monitor transaction velocity, new sender or recipient customer behavior, and historical trends to detect deviations that may indicate fraudulent activity. 

Mule detection and inbound monitoring

Alloy can help expand or build mule detection programs to include ACH transactions. By tracking account elements and historical transactions, institutions can flag and freeze suspicious outbound and inbound payments.

Third-party data 

Alloy has the largest partner network of third-party identity and fraud data solutions. By layering additional external data sources — such as behavioral analytics or consortium data — financial institutions can further strengthen their fraud controls. 

Key takeaway

The 2026 NACHA amendments mark a move toward risk-based, data-driven monitoring, and Alloy is here to help financial institutions not just comply but excel at detecting and preventing fraudulent activity.

By leveraging Alloy’s risk profiling, velocity monitoring, and partner integrations, financial institutions and fintechs can easily meet NACHA’s new monitoring requirements, protect customers from scams and false-pretense fraud, and strengthen their overall fraud prevention strategy for ACH payments.