NACHA Security Requirements: Compliant Guidelines for Modern ACH Processing

Making and receiving ACH (electronic) payments is one of the most critical capabilities for modern insurers — ensuring companies across healthcare, property and casualty, and workers’ compensation can receive premiums and pay claims efficiently and timely. Since 2020, consumers and businesses alike have increasingly preferred the speed and convenience of electronic payments. ACH payments have risen to meet these demands, allowing insurers to offer flexible payment options. Last year, insurers processed 510 million healthcare claim payments through the ACH Network, marking an astounding 2,556% increase since 2013. 

During this same time period, check fraud has increased to unprecedented levels. Although ACH payments offer greater security than paper checks, they remain vulnerable to fraud. Insurers of all sizes are encountering a rising number of threats, from internal embezzlement and sophisticated email compromise to identity theft, all of which require vigilant security measures and proactive risk management. 

Now more than ever, staying compliant and ensuring the security of ACH payments is not just an operational necessity — it’s foundational. For insurers, ACH payments handle claim reimbursements, provider and vendor payments, and premium collections at scale, in an efficient and cost-effective manner. But as ACH volume grows, so does the risk of fraud, data breaches, and compliance violations. More transactions mean more exposure, making modern ACH processing and strong security controls a must.  

Core Requirements for NACHA Security Compliance 

Electronic payments are all originated through the through the Automated Clearinghouse House (ACH) network, which is governed by the National Automated Clearinghouse Association (NACHA). Since 2021, NACHA’s data security requirements have set the rules for protecting ACH transactions. These rules cover encryption, access controls, and fraud prevention — setting clear protections for all merchants, billers, businesses, governments and third parties.  

 As ACH processing expands, compliance requirements increase. Specifically for insurers, they need to consider much more than basic security measures. Due to the highly sensitive nature of financial data, they need proactive risk management to protect funds, avoid penalties, and prevent fraud. 

Best Practices for Protecting Bank Information 

Even today, staying compliant with NACHA’s security framework requires key capabilities within modern payment systems to safeguard financial data. 

• Data Encryption: Banking information must be encrypted both in transit and at rest. Encryption protects sensitive data from unauthorized access — even if it’s intercepted. 

• Defined ACH Policy: A detailed ACH Policy should spell out how payments are initiated, approved, and processed. Clear procedures can reduce errors and enforce compliance. 

• Role-Based Permissions: Employees should only access ACH payment data if they have a clear business need. Limiting access reduces the risk of fraud or accidental exposure. 

• Periodic Access Reviews: Permissions should be reviewed regularly. Audit logs help ensure that only authorized employees handle sensitive data. 

• Annual Risk Assessments: Reviewing access controls, authentication protocols, and compliance measures on an annual basis ensures payment workflows stay protected.   

• Audit Trails: Every ACH transaction must be logged. A clear transaction history supports compliance, simplifies investigations, and deters fraud. 

Fraud Prevention Essentials for ACH Payments 

Fraud prevention for ACH payments is crucial, regardless of the transaction volume. Every ACH payment carries a potential risk and stopping fraudulent transactions before they fully process is key. Modern ACH payment processing should include:  

• Real-time Fraud Detection: Real-time analytics help spot unusual enrollment and payment activity, flag anomalies, and block unauthorized payments.  

• Multi-factor Authentication (MFA): Requiring multiple credentials for accessing stored banking information makes unauthorized access harder.  

• Fraud Scheme Training: Teaching employees how payment fraud happens empowers them to helps prevent it. 

• Continuous Transaction Monitoring: Reviewing transaction logs regularly ensures suspicious activity is caught early. 

• Multi-Faceted Due Diligence and Validation Processes: Ensuring that all banking data within ACH enrollment and update requests is correct, and that interactions and communications are with the intended end-user.  

 With these complex requirements, a best practice is to select a payments partner that will originate ACH transactions on your behalf. An experienced partner can enhance security, safely store banking information, streamline payment operations and prevent fraud. Insurers that manage ACH processes in-house drain valuable resources, increasing costs and operational complexity. The right partner ensures efficient, secure transactions while allowing insurers to focus on core business priorities — delivering accurate, timely payments and maintaining trust with policyholders. 

Promising Peace of Mind with Secure ACH Payments 

As ACH volume continues to grow, secure and efficient payment processing is more important than ever. Modern ACH workflows should reduce fraud risk, streamline processing, and ensure the safety of banking information. By proactively preventing fraud, ACH payments remain reliable, while also protecting insurers from reputational risk and strengthening relationships with policyholders.  

As a trusted payment partner for over 25 years, ECHO empowers insurers with a secure payment platform that integrates seamlessly into core systems. With robust, multi-layered fraud protection through ECHO Guard, insurers safeguard both payments and sensitive data and also process any payment type with confidence. By handling the entire payment lifecycle, ECHO eliminates operational burdens to deliver accuracy, security, and peace of mind. 

Get started with ECHO to modernize your payment processing with secure, accurate ACH payments.