If our bank has a customer that pays with a paper check at a retailer or elsewhere and the payee on the check converts the check to an ACH debit - does this count as a check or an ACH for Reg D and excessive money market withdrawals?

As far as the customer knows, he/she paid with a check. However, for us as the bank it comes across as an ACH, although we can tell that it originally was a check because the check number also comes through.

THANKS!

I believe whether the item comes in as a check or ACH is irrelavant. The limitations still apply.

The Fed hasn't directly spoken to your question. It's official word is that ACH debits are "6 bucket" items. But you would be more correct to count RCK, POP, ARC (and soon, BOC) transactions as you would count checks, in my opinion.