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Operations & Processing Flashcards

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1
Q

Prior to participating in FedNow network, participants must establish a participant profile according to their

A

Business needs and risk tolerance.

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2
Q

All messages exchanged through FedNow requires

A

A digital signature generated by the participants.

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3
Q

Each FedNow participant shall adopt and maintain

There are 3.

A
  1. Procedures for screening sanctions list against their customer base
  2. A compliance program
  3. A Bank Secrecy Act (BSA) / anti money laundering (AML) compliance program
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4
Q

RTP requirements to receive/originate transactions.

There are 4.

A
  1. Comply with RTP Operating Rules and technical specifications
  2. Specify a settlement account and ensure adequate funds to settle obligations
  3. Sending participants must provbide the Sender with the name of the Receiver associated with the receiving account for payments originating from consumer accounts
  4. Must first transmit sign on request message to be reachable on RTP Network (admn.001)
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5
Q

Prior to becoming a Mastercard Send participant, what are the requirements?

There are 3.

A
  1. Register for the required programs and services
  2. Meet program eligibility requirements
  3. Adhere to the service’s standards and rules
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6
Q

What participant must enter into an agreement with an Originating Depository Financial Institution (ODFI)?

A

Originator

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7
Q

Steps that originating Acquirer (either itself, or through its merchants or service providers that originate Original Credit Transactions) must follow prior to implementing Visa Direct.

There are 7.

A

Originating acquirer must
1. Complete self testing in sandbox
2. Acquire BIN
3. Complete VisaNet configuration and testing
4. Setup settlement account
5. Setup reporting
6. Pilot testing
7. Launch Visa Direct

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8
Q

What happens if a Customer Credit Transfer (pacs.008) message fails one of the FedNow network validation checks?

There are 2.

A

If the message fails one of the validation checks, FedNow network:
1. Rejects the message and sends a message reject (admi.002) with the appropriate reason code to the sender FI, or
2. Continues processing through validations to collect any additional errors. FedNow Service then sends a payment status message (pacs.002) with consolidated appropriate error reason code(s)

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9
Q

What are the possible responses from the Receiver Financial Institution to a Customer Credit Transfer (pacs.008)?

There are 3.

A
  1. Accept
  2. Accept without posting
  3. Reject
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10
Q

Under what circumstances can a Receiving Financial Institution send an Accept Without Posting (ACWP) response?

A

The Receiving Financial Institution needs to investigate for legal or compliance reasons to determine if the credit can be posted to the Receiver’s account.

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11
Q

What requirements should a Sending Participant satisfy before submitting a payment message to the RTP network?

A
  1. Satisfy the prefunding requirements
  2. Ensure payment message complies with applicable RTP Operating Rules and technical specifications
  3. Provide Sender/Payer with the name of the receiver associated with the receiving account number for payments originating from consumer accounts
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12
Q

What sign on message should a RTP participant transmit to be reachable on the RTP network?

A

admn.001

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13
Q

Before originating an Original Credit Transaction (OCT) through Visa Direct network, what must an originating acquirer do?

A
  1. Validate sender data.
  2. Comply with AML laws and regulations.
  3. Provide proper disclosures to the sender about collection of data.
  4. Notify Visa before it or its merchant / service provider start processing OCT.
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14
Q

What are the stages of a faster payments transaction?

There are 5.

A
  1. Initiation
  2. Validation
  3. Response/processing
  4. Settlement
  5. Posting & notification
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15
Q

What is the ISO 20022 message used for Customer Credit Transaction in FedNow network or credit transfer message in RTP network?

A

pacs.008

pacs = payments clearing & settlement

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16
Q

What ISO 20022 message is used to provide a payment status message in FedNow network?

A

pacs.002

pacs = payments clearing & settlement

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17
Q

What ISO 20022 message is used to provide a message status report in RTP network?

A

pacs.002

pacs = payments clearing & settlement

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18
Q

How many times does the Visa Direct network settle?

A

Once per day.

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19
Q

What does the Sending Financial Institution do in the validation stage for Mastercard Send?

There are 2.

A
  1. Authenticates and screens the Sender
  2. Makes a payment trasnfer API POST request to Mastercard Send
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20
Q

What validations does Mastercard Send operator perform during validation stage?

There are 3.

A
  1. API request checks
  2. Transaction controls
  3. Limit validations
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21
Q

What are Visa Direct Originators expected to do before sending a message to the network?

There are 3.

A
  1. Perform know your customer (KYC)
  2. Fraud check
  3. Eligibility checks on Sender and/or Receiver
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22
Q

What are the types of participant profiles available for FedNow network?

There are 4.

A
  1. Send & Receive
  2. Receive only
  3. Send & Receive Liquidity Management Transfers (LMTs)
  4. Receive LMTs only
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23
Q

Which is the optional message validation process for FedNow network?

A

A participant may do ‘Negative List Check’ if it has been enabled.

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24
Q

What are the process requirements for message validation for Same Day ACH?

There are 7.

A
  1. Verify the file is not duplicate
  2. Originator info, including qualification to originate
  3. File format
  4. Eligibility to originate Same Day ACH
  5. Dollar totals at batch and file levels
  6. Origination does not exceed the agreed upon limits
  7. Verify there is a valid agreement/authorization from the end user to initiate the payment
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25
What are the services Mastercard Send recommends its participants use? | There are 2.
1. Account Information Service (AIS) 2. Account Validation Service (AVS)
26
What are Account Information Services (AIS) and Account Validation Services (AVS) used for?
AIS is used to confirm sending card and receiving card accounts are eligible to send and receive payment transfers, respectively. AVS is used to confirm the sending and receiving card accounts are still valid and open and verify the provided Sender/Receiver's details.
27
What factors will cause a FedNow or RTP payment to fail from the sender? | There are 2.
1. Insufficient funds 2. Failure in initiation channels
28
What are the potential causes for failure of FedNow or RTP payments due to system/network? | There are 3.
1. Lack of availability for 24X7 2. Malfunctioning system 3. Lack of connection to Sending Financial Institution/network/Receiving Financial Institution
29
What is the cause of failure from the liquidity provider in FedNow or RTP network?
Unavailability of settlement account with sufficient liquidity.
30
How can participants mitigate message rejections/failures in faster payment networks? | There are 8.
1. Provide a list of necessary validations prior to message submission 2. Validate the existence & availability of receiving account 3. Share status of payment throughout payments flow 4. Ensure continuous availability that allows for proper monitoring and alerting of issues 5. Provide system-wide messages to communicate participant availability 6. Flexible options to support liquidity needs 7. Monitor settlement account 8. Analyze transaction errors
31
How long should a Sending Financial Institution wait to inquire about a message status sent to FedNow network? | Minimum amount of time.
Minimum 25 seconds
32
What message can a Sending Financial Institution send to the FedNow or RTP network to inquire about the status of a message?
pacs.028 ## Footnote pacs = payments clearing & settlement
33
Where can a Sending Financial Institution check the status of a message sent to the FedNow network?
FedNow Interface Adhoc Query Tool
34
Under what circumstances can a Sending Financial Institution resend a payment message to the FedNow network, with a previously used message ID?
Sending Financial Institution sends a payment status request to FedNow network (pacs.028), FedNow network responds 'message not found', only then the Sending Financial Institution can resend the message with the same previously used message ID.
35
What type of message does FedNow send to the Sending Financial Institution to notify the participant that the payment message was rejected?
pacs.002 ## Footnote pacs = payments clearing & settlement
36
What happens if the Receiving Financial Institution, in FedNow network, receives the contents of the payment message in a request for confirmation but fails to respond before the timeout clock expires?
FedNow network notifies the Receiving Financial Institution that the payment has been rejected.
37
If the Sending Financial Institution resends a payment message with a previously used message ID and FedNow Service did receive the previously sent message, what would FedNow do?
Reject the resent message using the 'duplicate message ID' reason.
38
What ISO 20022 message is used for a request for payment?
pain.013
39
What ISO 20022 message is used to provide response to a request for payment?
pain.014
40
Which participants can initiate rejects in ACH Network?
ACH Operator
41
Which participants can initiate returns in ACH Network?
Receiving Depository Financial Institution (RDFI)
42
In cases of rejections/returns initiated by the ACH Operator, what are the Originating Depository Financial Institution (ODFI) obligations?
1. Forward the return to the Originator for action so that it can reinitiate the corrected Entry or contact the Receiver to arrange alternate payment method, OR 2. If it was returned due to NSF, reinitiate the entry for the Originator
43
After sending a transaction (Payment Transfer API) to the Mastercard Send network, what amount of wait time is recommended before the Sending Financial Institution performs an API Lookup (Payment Transfer API GET request) to retrieve more information for a payment transfer?
1 minute
44
The Mastercard Send message status that indicates the Sending Financial Institution should not resubmit a payment previously submitted.
UNKNOWN
45
The Mastercard Send message status that indicates the Sending Financial Institution should resubmit a payment previously submitted.
ERROR
46
What must a Sending Financial Institution do before resubmitting a payment transfer API for a Mastercard Send transaction?
The Sending Financial Institution must first use a payment transfer API 'GET request' to check the status of the original transaction to ensure that Mastercard Send has not financially processed the transaction.
47
What ISO 20022 message and code are used to report fraud on a FedNow transaction?
camt.056 with FRAD
48
What is the deadline for the Originator to reverse the funding transaction for a Mastercard Send transaction?
Within 30 minutes
49
The process used by Mastercard Send that allows participants to reprocess transactions with the status of failed payment or unknown.
Idempotency
50
What are the types of APIs used in Mastercard Send? | There are 3.
1. Funds Transfer API (POST request) 2. Payment Transfer API (POST Request) 3. Payment Transfer API (GET request)
51
What are the types of APIs used in Visa Direct? | There are 3.
1. Funds Transfer 2. Query 3. Refund
52
What transactions can be performed with the Funds Transfer API in Visa Direct? | There are 3.
1. Pull funds from a sender's Visa account in Account Funding Transaction (AFT) 2. Push funds to recipient's Visa account in Original Credit Transaction (OCT) 3. Return funds to the sender's funding account with Account Funding Transaction Reversal (AFTR)
53
What is the Query API used for in Visa Direct?
It is used to check whether the PullFunds, PushFunds or ReverseFunds transaction was processed successfully if received by Visa.
54
What is the admi.006 (retrieval request) message used for in FedNow?
To request retrieval of past 50 messages for current or prior 7 business days.
55
Prior to submitting a payment request in the FedNow or RTP network, a participant should do the following to reduce exception processing? | There are 6.
Ensure 1. Accuracy of message content 2. Participant profile has active status and is enabled to send & receive messages 3. Participant is connected to the service 4. Message has unique ID 5. Correct usage of business application header 6. Messages are sent to connected participants
56
How does the message status 'Accept Without Posting' (ACWP) help the Receiving Financial Institution reduce exceptions? | There are 2.
By allowing it to 1. Get additional information about the payment from the Sending Financial Institution 2. Perform its own checks and validations
57
Prior to submitting a Same Day ACH payment request, a participant should do the following to reduce exception processing? | There are 5.
1. Conduct anti-fraud checks to combat unauthorized returns and malicious users 2. Validate that message is properly structured 3. Ensure message is not duplicate 4. Ensure payment falls within the network limits 5. Ensure the message contains necessary information
58
What is the timeout clock for the FedNow network?
20 seconds
59
What is the maximum time within which a response must be provided by the Receiving Financial Institution to a transfer request in Visa Direct network?
30 seconds
60
What is the maximum time that a Mastercard Send funding transaction must be approved?
40 seconds
61
What is the purpose of an admi.006 message in FedNow?
Retrieval request
62
How many messages does one admi.006 message retrieve?
Up to 50 messages.
63
How many days' worth of messages does one admi.006 retrieve?
Up to 7 business days, including the current day.
64
How much time does the FedNow Receiving Financial Institution have to resolve an 'accept without posting' response?
By midnight E.T. of the next standard business day (Monday - Friday, except federal holidays).
65
How much time does the RTP Receiving Financial Institution have to resolve an 'accept without posting' response?
By 11:59 p.m. local time the next business day.
66
What is the ISO 20022 message used for 'request for return' in the FedNow and RTP network?
camt.056
67
What code does a RTP participant use to indicate fraud?
CUST with camt.056 message.
68
When accepting a 'request for return' for an RTP transaction, what must the Receiving Financial Institution include in its response?
Reference to the original credit transfer unique ID.

ePayResources AFPP Exam Flashcards (5 decks)

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