Prior to the 16.10 release, the SSA began using multiple Company IDs, and it was recommended that credit unions consider using Automated Funds Transfers (AFTs) to handle distributions.  Beginning the 16.10 release a new cross-reference system will be implemented that will automatically funnel all incoming company IDs from the Social Security Administration and treat them as if they came from one, consistent company ID we’re referring to as the “Primary ID.” 

With the changes made with the 16.10 release (see other associate Answer Book item), credit unions may wish to consider returning to the ACH model. 
Disadvantages for the AFT method: It might be tricky to time the AFT to coordinate with the ACH deposit, since these funds may be needed in order to make the AFT transfer. Research is needed to determine when the member’s ACH deposit is normally received to determine the best date on which to configure the AFT.

When selecting a date for the AFT transfer also factor in business days and holidays when ACH processing is not handled. Additionally, if your AFTs are processed at BOD, you will need to schedule your AFT a day later than the ACH would normally be received, since AFTs are processed prior to ACH payments in BOD processing.
  • For example, John Doe normally receives his SSA deposits on the 3rd of the every month. He wants to take $10 out of that deposit to put it into his Christmas Club account, and also make his $200 car loan payment, with the remaining funds staying in his checking account. John’s credit union normally processes AFT during EOD.
  • So the credit union sets up two AFTs to schedule transfers on the 4th of the month, one a savings-to-savings transfer from checking to the Christmas Club, and the other a savings-to-loan transfer from checking to the car loan. The car loan AFT is setup to make the payment every month regardless of the status of the loan.
  • On months when the 4th happens to fall on a holiday or Sunday, the AFT would post the next business day (morning or evening, depending on the CU’s settings for catching up after a non-business day). 
Because of the way SSA payments come in on a different day of the month each month, also remember that there may be a window of time between when the ACH deposit is made and when the AFT transfers the funds. During this time, the member could potentially withdraw the funds or make a separate loan payment.
  • For example, Jane Smith normally receives her SSA deposit on the third Wednesday of each month. So that deposit might come in any time between the 15th and the 21st, depending on how the days of that month happen to fall. So the CU sets up AFTs for her distributions to occur on the 22nd (one day after the latest day a SSA deposit could potentially be received).