The settlement leg of the payroll cycle, from submission to funds in employee accounts, is shortening as faster payment rails gain employer adoption. Four trends define the shift.
Same-Day ACH Adoption for Payroll Accelerates Among Mid-Market Employers
Direction: accelerating. Maturity: gaining adoption. Vintage: accelerating since 2023, continuing through 2025.
NACHA reported that same-day ACH volume exceeded one billion transactions in 2023, with payroll identified as a primary use-case driver. Same-day ACH gives employers a recovery window when payroll is submitted late; rather than missing payday entirely, same-day settlement can still fund employee accounts on the scheduled pay date if submitted by the processor's same-day cutoff.
Payroll Processor Cutoff Windows Are Tightening
Direction: accelerating. Maturity: gaining adoption. Vintage: observed 2024 through 2025.
As same-day ACH becomes common, payroll processors are revising submission cutoff schedules, some tightening standard cutoffs while adding same-day options. If you set your internal payroll calendar based on processor cutoffs from 2022 or 2023, re-verify current windows with your processor. A cutoff that moved even a couple of hours earlier can silently cause missed pay dates.
Two-Day ACH Remains Dominant but Is Losing Ground
Direction: mature, now reversing share dominance. Maturity: widely adopted, consolidating. Vintage: reversal signal observed 2023 through 2025.
Standard two-day ACH is still the most widely used payroll settlement method, but its share of total payroll transactions is declining as same-day ACH and real-time rails gain adoption. Two-day ACH remains reliable and cost-effective for employers with disciplined payroll calendars. The trend to watch: whether processor pricing for same-day ACH drops enough to make it the default by 2026 or 2027.
Real-Time Payment Rails for Payroll Remain Early-Signal
Direction: emerging. Maturity: early signal. Vintage: infrastructure available since July 2023 (FedNow launch); employer adoption emerging 2024 through 2025.
The RTP network and FedNow service are technically capable of supporting instant payroll disbursement, but employer adoption for regular payroll runs remains limited to pilots. Real-time payroll disbursement is not yet a mainstream operational decision, but if you are evaluating long-term payroll platform strategy, confirm whether your processor's roadmap includes RTP or FedNow support.
