![]() Those are the main ACH return reason codes that you’re likely to encounter on a day to day basis, but there are plenty of other, less common ACH return codes that you could run across. Suspend any recurring payments, contact the customer, and resolve any issues that resulted in the payment being disputed. This means that the receiver has notified the RDFI that the Entry is either unauthorized, improper, ineligible, or forms part of an incomplete transaction. ![]() ![]() Retry the transaction (you can do this up to two times within 30 days of the original payment authorization date).Ĭustomer Advises Unauthorized, Improper, Ineligible, or Part of an Incomplete Transaction This can occur in the case of uncollected checks, for example. This means that although there’s a sufficient ledger balance to satisfy the dollar value of the transaction, the available balance is below this dollar value. Get in touch with the customer to solve any issues which may have caused the transaction to be stopped. This means that the receiver of a recurring debit transaction has placed a stop payment order. The customer can either remove the block on transactions or debit a different account. Then, contact the customer and confirm why payment authorization was revoked. This means that the customer who authorized the ACH payment has revoked authorization.įirst, you should suspend any scheduled recurring payments. This means that the ODFI made a request for the RDFI to return the ACH Entry. This means that a debit Entry was transmitted to a consumer account, but the receiving member hasn’t authorized the Entry.Ĭontact the customer to resolve any issues leading to the disputed payment. Unauthorized Debit to Consumer Account Using Corporate SEC Code Reach out to the customer for the correct account number. This means that the structure of the account number isn’t valid. If the information differs from your initial Entry, make the changes and submit a new payment. Alternatively, it may indicate that the account isn’t open.Ĭontact the customer to confirm account number, routing number, and exact name. This means that although the structure of the account number is valid, the account number doesn’t match up with the individual identified in the Entry. This means that a previously active account was closed by the customer.Ĭontact the customer and request payment details from a different bank account. This means that the available balance isn’t enough to cover the value of the debit Entry. Now that you know a little more about the meaning behind ODFI and RDFI, here are some of the most common ACH return codes: Like ODFIs, major banking institutions are generally RDFI-approved, as are many third-party payment processors and payment gateways. RDFI – Standing for Receiving Depository Financial Institution, the RDFI is the bank that is being charged (debited) or refunded (credited). Most major banks are ODFI-approved, meaning that they’re able to send ACH money transfers, while payment processors, payment gateways, and ACH payment APIs may also be considered ODFIs. ODFI – Standing for Originating Depository Financial Institution, the ODFI is a financial institution that has an agreement with an ACH operator (either The Clearing House or the Federal Reserve) to transmit Entries into the ACH network on behalf of an originator. We’ll go over them momentarily, but first, let’s take a look at some of the key terms that you’re likely to come across when you read about ACH returns: There are over 80 different ACH return codes. There are a broad range of reasons for returned ACH payments, including insufficient funds, revoked authorization, or an invalid account number. Yes, ACH payments can be returned, and it’s a normal part of standard ACH processing. ![]() This results in an ACH return code, a three-character code that provides a little more detail about the specific nature of the problem. An ACH return simply means that – for whatever reason – the ACH couldn’t collect the funds from the customer’s account. What are ACH returns?ĪCH (Automated Clearing House) payments are a type of electronic bank-to-bank payment for businesses based in the U.S. Find out everything you need to know about ACH return codes, including our comprehensive ACH return code list, right here. So, what happens if an ACH payment is returned? We’ve got you covered. Understanding ACH returns, what causes them, and how to handle them is the best way to ensure the ACH process remains as smooth as possible for your business.
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