MDS Software Package Certified For Use In Third Federal Reserve District Automated Clearing Houses
Information Display · 1981
Data communications software developed by Mohawk Data Sciences Parsippany, NJ, for automated clearing house applications has been accepted for use in the Third Federal Reserve District.The approval came from the Federal Reserve Bank of Philadelph ia which, after stringent testing, certified the package for use in transmitting data to and from the Fed.The package, called ACH COMM, was developed specificallyfor automated clearing house (ACH) applications, in compliance with guidelines provided by the Third District Funds Transfer Association, which administers automated clearing houses in the Third District.Three banks in the district have already leased MDS SERIES 21 data processing equipment and are presently testing the software package.The Commonwealth National Bank of Harrisburg, and the American Bank and Trust Company of Reading, are using MDS System 21/40s with 64K random access memory, one CRT display, two diskette drives, 45 character-per-second printers, nine-track magnetic tape drives, and 2000 to 4800 bit-per-second communications capability.The First National Bank of South Jersey, located in Pleasantville, presently has a similar System 21 / 40 installed, but with a 340 line-per-minute pr inter and more sophisticated communications capabilities.Two more systems will soon be in operation.Automated clearing houses serve as batch payment processing systems where the user, usually a bank or company, authorizes the direct deposit of payments to banks dispersed over a wide geographic area.The payments are made to the account of an employee or benefit recipient who has authorized the company to do so.Although the physical paycheck is eliminated, the employee receives his pay stub noting the amount that was deposited directly to his account.Typical applications for automated clearing houses are payrolls, distribution of government benefits, and payment of dividends to shareholders.For many years, the information processed on magnetic tape at the corporation or government agency has been physically transported to the local bank by armored truck.The bank merges the information on this tape with other payroll information it has received during the day, and sends it, again by armored truck, to the automated clearing house for distribution.There it is separated into inter-regional and local transactions and transmitted, in the case of inter-regional transactions, to other Federal Reserve Districts via leased telephone lines.The local payments, in the form of magnetic tapes or printed output, are trucked to the individual banks where the payment is deposited in the account of the recipient.MDS SERIES 21 equipment and customized data communications software, it is said by Mohawk, will eliminate the over-the-road transportation of data between the bank and the automated clearing house and thus greatly increase the efficiency of the process.MDS software is successfully being used for automated clearing house applications in Richmond, VA, Boston, and New York City.William Burleigh, executive director of the Third District Funds Transfer Association, predicts that automated clearing house processing of the future will be far more automated than at present."We envision, very rapidly, perhaps within the next year, to have just about every major computer installation transmitting either by terminals or computer-to-computer links, " said Burleigh.10/lnformation Display 1-81 Sanders Provides Video Training Systems for Army Weapons Use