The best way to ensure the ACH process remains as smooth as possible for your business is to understand ACH returns, their reasons, and how to handle them. Eighty-five reasons can cause ACH payments to fail or be returned, generating return codes during or after ACH payment processing, which we've compiled for you below. Some of the ACH return codes aren't the most user-friendly, and in some cases, the ACH codes are reserved for use by government or receiving depository financial institution (RDFI) organizations.
Here are some of the key terms you're likely to come across when you read about ACH returns:
The RDFI generates ACH debit returns in response to a transaction. Many believe the process is complete after an ACH transaction has been finalized, but that's not the case. For various reasons, an ACH operator may request the funds be returned.
The funds are granted when a request is submitted to an ACH operator. Then, the request is sent to the bank holding the accounts, and if the request cannot be completed, the operator requires them to be returned. ACH return codes are the process by which money is taken back with the information as to why the return is being provided. Also, keep in mind the concept of "notice of change" (NOC), as this can play a part in the ACH debit return process. A customer's bank account information may change due to changes in account numbering, bank mergers, etc.
When this happens, updated information about the account will be sent back to the submitter, and the transaction will be returned. This step is referred to as a notice of change and requires the submitter to update the customer's bank account information before a subsequent request is submitted.
If subsequent requests continue to use outdated information, the transaction most likely won't be processed, resulting in an ACH debit return.
ACH return codes have a typical turnaround time of two banking days. However, specific ACH return reason codes may have a slightly longer time frame. For example, unauthorized debits to consumer accounts tend to have a 60-day return timeframe, as banking regulations are relatively consumer-friendly.
On average, ACH return fees range from $2-$5 per return.
If the return meets any of the following criteria, you can request the ODFI dishonor the return:
Dishonored returns must be sent within five banking days of the return settlement date, and the RDFI can contest them. If this happens, recovery will need to occur outside the ACH network.
| Return Code | Description | Details |
|---|---|---|
| R01 | Insufficient Funds | The available and / or cash reserve balance is not sufficient to cover the dollar value of the debit entry. |
| R02 | Account Closed | A previously active account has been closed by action of the customer or the RDFI. |
| R03 | No Account / Unable to Locate Account | The account number structure is valid and it passes the check digit validation, but the account number does not correspond to the individual identified in the entry, or the account number designated is not an open account. |
| R04 | Invalid Account Number | The account number structure is not valid. The entry may fail the check digit validation or may contain an incorrect number of digits. |
| R05 | Unauthorized Debit Entry | A business debit entry was transmitted to a members consumer account, and the member had not authorized the entry |
| R06 | Returned per ODFI's Request | The ODFI has requested that the RDFI return the ACH entry. If the RDFI agrees to return the entry, the ODFI must indemnify the RDFI according to Article Five (Return, Adjustment, Correction, and Acknowledgement of Entries and Entry Information) of these Rules. |
| R07 | Authorization Revoked by Customer | The RDFI's customer (the Receiver) has revoked the authorization previously provided to the Originator for this particular transaction. |
| R08 | Payment Stopped or Stop Payment on Item | The Receiver of a recurring debit transaction has the right to stop payment on any specific ACH debit. The RDFI determines that a stop payment order has been placed on the item to which the PPD debit entry constituting notice of presentment or the PPD Accounts Receivable Truncated Check Debit Entry relates. |
| R09 | Uncollected Funds | Sufficient book or ledger balance exists to satisfy the dollar value of the transaction, but the dollar value of transactions in the process of collection (i.e., uncollected checks) brings the available and/or cash reserve balance below the dollar value of the debit entry. |
| R10 | Customer Advises Not Authorized | The RDFI has been notified by its customer, the Receiver, that the Originator of a given transaction has not been authorized to debit his account. |
| R11 | Check Truncation Entry Return | To be used when returning a check truncation entry. This reason for return should be used only if no other return reason code is applicable. |
| R12 | Branch Sold to Another DFI | A financial institution may continue to receive entries destined for an account at a branch that has been sold to another financial institution. Because the RDFI no longer maintains the account and is unable to post the entry, it should return the entry to the ODFI. |
| R13 | RDFI Not Qualified to Participate | Financial institution does not receive commercial ACH entries. |
| R14 | Representative Payee Deceased or Unable to Continue in that Capacity | The representative payee is a person or institution authorized to accept entries on behalf of one or more other persons, such as legally incapacitated adults or minor children. The representative payee is either deceased or unable to continue in that capacity. The beneficiary is not deceased. |
| R15 | Beneficiary or Accountholder (Other than a Representative Payee) Deceased | 1.The beneficiary is the person entitled to the benefits and is deceased. The beneficiary may or may not be the account holder; 2.The account holder (acting in a non-representative payee capacity) is an owner of the account and is deceased. |
| R16 | Account Frozen | The funds in the account are unavailable due to specific action taken by the RDFI or by legal action. |
| R17 | File Record Edit Criteria (Specify) | Fields rejected by RDFI processing (identified in return addenda) |
| R18 | Improper Effective Entry | Entries have been presented prior to the first available processing window for the effective date |
| R19 | Amount Field Error | Improper formatting of the amount field |
| R20 | Non-Transaction Account | The ACH entry destined for a non-transaction account, as defined in Regulation D, would include either an account against which transactions are prohibited or limited or a pass - through where the entry is for a credit union or thrift organization and Regulation E descriptive requirements cannot be met. |
| R21 | Invalid Company Identification | The identification number used in the Company Identification Field is not valid. This Return Reason Code will normally be used on CIE transactions. |
| R22 | Invalid Individual ID Number | In CIE and MTE entries, the Individual ID Number is used by the Receiver to identify the account. The Receiver has indicated to the RDFI that the number with which the Originator was identified is not correct. |
| R23 | Credit Entry Refused by Receiver | The Receiver may return a credit entry because one of the following conditions exists: 1. a minimum amount required by the Receiver has not been remitted; 2. the exact amount required has not been remitted; 3. the account is subject to litigation and the Receiver will not accept the transaction; 4. acceptance of the transaction results in an overpayment; 5. the Originator is not known by the Receiver; 6. the Receiver has not authorized this credit entry to this account. |
| R24 | Duplicate Entry | The RDFI has received what appears to be a duplicate entry; i.e., the trace number, date, dollar amount and/or other data matches another transaction. This code should be used with extreme care. The RDFI should be aware that if a file has been duplicated, the Originator may have already generated a reversal transaction to handle the situation. |
| R25 | Addenda Error | Improper formatting of the addenda record information |
| R26 | Mandatory Field Error | Improper information in one of the mandatory fields |
| R27 | Trace Number Error | Original entry trace number is not valid for return entry; or addenda trace numbers do not correspond with entry detail record |
| R28 | Routing Number Check Digit Error | Check digit for transit routing number is incorrect |
| R29 | Corporate Customer Advises Not Authorized | The RDFI has been notified by the Receiver (non-consumer) that the Originator of a given transaction has not been authorized to debit the Receiver's account. |
| R30 | RDFI Not Participant In Check Truncation Program | Financial institution not participating in automated check safekeeping application |
| R31 | Permissible Return Entry (CCD and CTX Only) | The RDFI has been notified by the ODFI that the ODFI agrees to accept a CCD or CTX return entry in accordance with Article Seven, section 7.3 (ODFIAgrees to Accept CCD or CTXReturn). |
| R32 | RDFI Non-Settlement | RDFI is not able to settle the entry |
| R33 | Return of XCK Entry | RDFI determines at its sole discretion to return an XCK entry; an XCK return entry may be initiated by midnight of the sixtieth day following the settlement date if the XCK entry |
| R34 | Limited Participation DFI | RDFI participation has been limited by a federal or state supervisor |
| R35 | Return of Improper Debit Entry | ACH debit not permitted for use with the CIE standard entry class code (except for reversals) |
| R36 | Return of Improper Credit Entry | ACH credit entries are not permitted for use with ARC, BOC, POP, RCK, TEL, XCK |
| R37 | Source Document Presented for Payment (adjustment entries) (A.R.C.) | The source document to which an ARC, BOX, or POP entry relates has been presented for payment. |
| R38 | Stop Payment on Source Document (adjustment entries) | Stop payment has been placed on a check used for an ARC entry |
| R39 | Improper Source Document/Source Document Presented for Payment | Source Document Presented for Payment RDFI determines that the source document (share draft or check) used for an ARC, BOC or POP entry is not eligible for conversion. Or the share draft has already been paid as a normal check posting. |
| R40 | Return of ENR Entry by Federal Government Agency | The Federal Government Agency determines at its sole discretion to return an ENR entry. This return reason code may be used only to return ENR entries. |
| R41 | Invalid Transaction Code | Either the Transaction Code included in Field 3 of the Addenda Record does not conform to the ACH Record Format Specifications contained in Appendix Two (ACH Record Format Specifications) or it is not appropriate with regard to an automated ENRollment entry. |
| R42 | Routing Number or Check Digit Error (ENR only) | The Routing Number and the Check Digit included in Field 3 of the Addenda Record is either not a valid number or it does not conform to the Modulus 10 formula. |
| R43 | Invalid DFI Account Number (ENR only) | The consumer's or company's account number included in Field 3 of the Addenda Record must include at least one alphanumeric character. |
| R44 | Invalid Individual Id Number or Identification Number (ENR only) | The Individual ID Number/Identification Number provided in Field 3 of the Addenda Record does not match a corresponding ID number in the Federal Government Agency's records. |
| R45 | Invalid Individual Name/Company Name (ENR only) | The name of the consumer or company provided in Field 3 of the Addenda Record either does not match a corresponding name in the Federal GovernmentAgency's records or fails to include at least one alphanumeric character. |
| R46 | Invalid Representative Payee Indicator (ENR only) | The Representative Payee Indicator Code included in Field 3 of the Addenda Record has been omitted or it is not consistent with the Federal Government Agency's records. |
| R47 | Duplicate Enrollment | The entry is a duplicate of an automated ENRollment entry previously initiated by a participant in the ENRautomated ENRollment program. |
| R48 | Reserved | |
| R49 | Reserved | |
| R50 | State Law Affecting RCK Acceptance | The RDFI is located in a state that has not adopted Revised Article 4 of the Uniform Commercial Code (1990 official Text) and has not revised its customer agreements to allow for electronic presentment. The RDFI is located within a state that requires all canceled checks to a specific type of account to be returned to the Receiver within the periodic statement. |
| R51 | Item Ineligible, Notice Not Provided, Signature Not Genuine, or Item Altered | An entry may be considered to be ineligible if the item to which the RCK entry relates is not an item within the meaning of Revised Article 4 of the Uniform Commercial Code (1990 official Text); the item is not a negotiable demand draft drawn on or payable through or at a Participating DFI, other than a Federal Reserve Bank or Federal Home Loan Bank; the item is in an amount of $2,500 or more; the item does not indicate on the face of the document that it was returned due to “Not Sufficient Funds, "NSF", Uncollected Funds,” or comparable language; the item is dated more than 180 days from the date the entry is being transmitted to the RDFI (i.e., the item to which the RCK entry relates is stale dated); the item is drawn on a non-Consumer Account; the item has been previously presented more than two times in its physical form, or more than one time in its physical form and more than one time as an RCK entry. |
| R52 | Stop Payment on Item | The RDFI determines that a stop payment order has been placed on the item to which the RCK entry relates. An RDFI using this Return Reason Code must transmit the return entry by its ACH Operator's deposit deadline for the return entry to be made available to the ODFI no later than the opening of business on the banking day following the sixtieth calendar day following the SettlementDate of the RCK entry to which the item relates. |
| R53 | Paper Backup Missing or not in Agreement | In addition to an RCK entry, the item to which the RCK entry relates has also been presented for payment. |
| R54 | Reserved | |
| R55 | Reserved | |
| R56 | Reserved | |
| R57 | Reserved | |
| R58 | Reserved | |
| R59 | Reserved | |
| R60 | Reserved | |
| R61 | Misrouted Return | The financial institution preparing the return entry (the RDFI of the original entry) has placed the incorrect Routing Number in the Receiving DFI Identification field (positions 04-12, including Check Digit, of the Entry Detail Record). |
| R62 | Incorrect Trace Number | The Trace Number found in positions 07-21 in the Addenda Record of the return entry is different from the trace number of the original entry. |
| R63 | Incorrect Dollar Amount | The dollar amount in the Entry Detail Record of the return entry is different from the dollar amount of the original entry. |
| R64 | Incorrect Individual Identification | The Individual Identification Number reflected in the Entry Detail Record of the return entry is different from the Individual Identification Number/Identification Number used in the original entry. |
| R65 | Incorrect Transaction Code | The Transaction Code in the Entry Detail Record of the return entry is not the return equivalent of the Transaction Code in the original entry. (See list of Transaction Codes in Appendix Two (ACH Record Format Specifications). All entries must be returned as received: e.g., credit as credit, debit as debit, demand as demand, savings as savings.) |
| R66 | Incorrect Company Identification | The Company Identification number used in the Company/Batch Header Record of the return entry is different from the Company Identification number used in the original entry. |
| R67 | Duplicate Return | The ODFI has received more than one return for the same entry. |
| R68 | Untimely Return | The return entry has not been sent within the timeframe established by these rules. |
| R69 | Multiple Errors | Two or more of the following fields—Original Entry Trace Number, Amount, Individual Identification Number/Identification Number, Company Identification, and/or Transaction Code—are incorrect. |
| R70 | Permissible Return Entry Not Accepted | The ODFI has received a CCD or CTX return entry identified by the RDFI as being returned with the permission of the ODFI, but the ODFI has not agreed to accept the entry. This code may be used only to dishonor a return containing an R31 return reason code. |
| R71 | Misrouted dishonored return | |
| R72 | Untimely dishonored return | |
| R73 | Timely original return | |
| R74 | Corrected return | |
| R75 | Original Return Not a Duplicate | The original return entry was not a duplicate of an entry previously returned by the ODFI. This code may be used by the RDFI to contest an entry dishonored by the ODFI using return code R67 (duplicate return). |
| R76 | No Errors Found | The original return entry did not contain the errors indicated by the ODFI in the dishonored return entry bearing return code R69 (field errors). |
| R77 | Non-Acceptance of R62 Dishonored Return | |
| R78 | Reserved | |
| R79 | Reserved | |
| R80 | Cross-Border Payment Coding Error | The cross-border entry is being returned due to one or more of the following conditions: • invalid Foreign Exchange Indicator; • invalid ISO Originating Currency Code; • invalid ISO Destination Currency Code; • invalid ISO Destination Country Code; • invalid Transaction Type Code. |
| R81 | Non-Participant in Cross-Border Program | The cross-border entry is being returned because the Originating Gateway Operator does not have an agreement with the ODFI to process cross-border entries. |
| R82 | Invalid Foreign Receiving DFI Identification | The reference used to identify the Foreign Receiving DFI of an outbound cross-border entry is invalid. |
| R83 | Foreign Receiving DFI Unable To Settle | The cross-border entry is being returned due to settlement problems in the foreign payment system. |
| R84 | Entry not processed by gateway | |
| R85 | Incorrectly coded outbound international payment |
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