New ACH Pre-note Verification Process Impacting ePayments and eRefunds – Effective January 20, 2022

Effective January 20, 2022, if you are using a newly set-up ePayment or eRefund profile for online payment or refunds, your account will be subject to a pre-note verification process.  The verification may take up to seven days to process and you will not be able to use the account for making ePayments or receiving an eRefund until the pre-note process is complete and the account information verified.

Some important items to note regarding the new process:

  • The pre-note process will only impact the first-time use of newly set-up ePayment or eRefund accounts. Checking or savings accounts already in use and saved as a payment method or profile in the system will not need to be reverified through the pre-note process.
  • During the pre-note period, which can take up to seven days, the ePayment or eRefund profile will not be available for use. Be sure to allow extra time the first time you will be using a new checking or savings account as a “saved payment method” for making an ePayment or setting up an eRefund profile.

Why the Pre-note Process Is Being Implemented

To help mitigate risks associated with electronic payments, The National Automated Clearing House Association (NACHA) has updated the NACHA Operating Rules to include account validation as a required measure of the commercially reasonable fraudulent transaction detection system used by the University to keep ACH transactions secure.  To ensure compliance with the new rule, the University is implementing an ACH pre-note account verification process for ACH ePayments (electronic check payments) and ACH eRefunds (direct deposit refunds.)

How the Pre-note Process Works

The ACH pre-note process allows the University to confirm with the bank that checking or savings accounts are valid and active accounts prior to making monetary transactions.  After a student or Authorized User has saved a payment profile with a new checking or savings account, a zero-dollar transaction is sent to the bank; the bank should then respond during the pre-note period with a code indicating whether or not the account has been verified as active.  Once the verification period has passed without issue, the saved ePayment or eRefund profile can be used for future transactions. 

Immediate payment options include paper check payments or using PayPath, a third-party vendor that accepts credit card payments on behalf of St. Thomas.  There is a 2.85% (or minimum of $3.00) fee to use the PayPath service.

If the bank returns a transaction with a return code or notice of change, then the corresponding ePayment or eRefund profile will be removed from the system.  An email notification will be sent regarding the failure to verify the banking information. 

Within the eBill/ePay system your saved payment method will have a status notation listed:

"Awaiting verification" means it is still in the pre-note process.
"Verified - Ready for use" means it has been verified and can be used to make payments or receive eRefunds.
"Failed Verification" means the bank account information could not be verified and the profile cannot be used.  The ePayment and/or eRefund profile needs to be deleted.

Once the account information has been verified, it will also be available to choose as a payment method when completing the ePayment process or selecting an account for eRefunds.  If your account information could not be verified, a new payment method must be created which will also be subject to the pre-note verification process.