Sign in Start now
Back to Payments
Payments
16 min

What are ACH return codes

Frustrated by bounced ACH payments? Understand ACH return codes (R01-R85) and learn what to do when you receive one (explanation for every code).

Published at
Frustrated woman in an apron sitting at a desk with a laptop and papers, holding her head in one hand.

When a business owner makes a payment, or when someone pays them, the desire is to check it off the list and move on to the next thing. No one likes it when payment procedures fall through. But when they do, it’s important to know why it happened and what can one do about it. Enter: ACH return codes.

What are ACH return codes?

ACH return codes might as well be called “ACH return reason codes,” because that’s exactly what they are: they tell you the reason why your ACH payments were returned or rejected.

Nacha, which governs the ACH network, gives every reason its own code. Financial institutions use these codes when handling returned payments, whether they’re the issuing or receiving bank in a given transaction.

Why ACH return codes matter for your business

Payments that get returned can add a lot of stress to the people responsible for business payments. Trying to stay on top of it, figure out what happened and how to fix it, can feel daunting.

ACH return codes make the process simpler. For example, if a business owner or accountant gets an R03 ACH return code, she can check the table below and quickly find out that…

  • It means there’s no bank account.
  • This usually happens when there’s a typo while adding the  account information.
  • It can be easily fixed by checking the account information carefully and trying again.

Stress levels go down, and the ability to move forward and continue operating efficiently increases.

Common ACH return codes (R01-R10) with explanations

Let’s review the most common ACH return codes, what they mean and what to do when you come across them. Save this list for when you need it.

ACH Return Code Description What This Means What to Do Timeframe
R01 Insufficient funds The available balance isn’t enough to cover the transaction. Retry the transaction once the funds are available. 2 days
R02 Account closed The account you’re trying to do business with no longer exists. Ask your customer for updated account information. 2 days
R03 Unable to locate account/no account The account doesn’t exist, can’t be matched with the written name, or most commonly, there was a typo in writing the information. If there’s a typo, try again. If the information is correct, contact your customer for updated information. 2 days
R04 Invalid account number The account structure or information isn’t correct. Correct the information and retry the transaction. If it doesn’t work, contact your customer. 2 days
R05 Unauthorized debit to consumer account via corporate SEC code The transaction was processed as a business transaction instead of a consumer one. Verify your transaction categorization or check with your recipient. 60 days
R06 ODFI (originating depository financial institution) requested return The payer’s bank asked for the money back – either because the payer asked for that, or because there’s a fraud suspicion. Contact the bank for help. 60 days
R07 Authorization revoked by customer A customer first confirmed a transaction, then revoked it. Contact your customer to understand the reason. 60 days
R08 Payment stopped The customer asked to stop debit the ACH payment. Contact your customer. 2 days
R09 Uncollected funds The customer doesn’t have enough money to make this payment. Contact your customer. 2 days
R10 Originator not known and/or unauthorized to debit receiver’s account There’s a dispute over the transaction, a mistake has been made, or the transaction is fraudulent. Stop recurring transactions and contact your customer. 60 days

 

Less common, but still important, ACH return codes (R11-R85)

The following ACH return codes might be less common than the first 10, but it’s a list that’s still useful to have around in case you come across them.

ACH Return Code Description What This Means What to Do Timeframe
R11 Check truncation entry return The receiving bank couldn’t accept an electronic check because it was deposited incorrectly, there were insufficient funds or a potential fraud. Contact the receiving bank. 60 days
R12 Branch sold to another DFI (depository financial institution) The receiving bank branch was sold to another financial institution. Contact your customer for updated account information. 2 days
R13 Invalid ACH routing number The routing number provided is incorrect. Verify account information with your customer. Next file delivery time after processing
R14 Representative payee deceased or unable to continue in that capacity The person managing the recipient’s finances has died or cannot perform their duties. Contact the customer or recipient for more information before deciding how to move forward. 2 days
R15 Beneficiary or account holder is deceased The person who was supposed to make the payment has passed away. Banks can’t charge someone who has passed away. If the account holder was part of a big organization, consider contacting it to decide how to move forward. 2 days
R16 Account frozen Money can’t be transferred from the account due to maintenance, legal issues or fraud. Contact your customer to receive an alternative payment method. 2 days
R17 File record edit criteria Missing information or incorrect account formatting. Retry the transaction. 2 days
R18 Improper effective date The date listed is invalid or inconsistent with requirements. Correct the date and retry the transaction. Next file delivery time after processing
R19 Amount field error Entries misformatted or missing information, or transaction amount being larger than allowed. Correct the amount and retry the transaction. Next file time following processing
R20 Non-transaction account The receiving account can’t accept electronic transactions (for example, because it’s a savings account). Ask your customer for an account that you can charge. 2 days
R21 Invalid company identification The company identification number that was entered is incorrect. Retry the transaction or contact your customer for updated information. 2 days
R22 Invalid individual ID number The entered ID information is incorrect. Retry the transaction or contact your customer for correct information. 2 days
R23 Credit entry refused by receiver The receiving bank refused to accept the payment because the payment was unexpected, too large, too small, or the receiving account isn’t allowed to accept payments. Contact the account’s owner. Upon receipt of refusal
R24 Duplicate entry There was an attempt to make the payment more than once – likely accidentally or due to a tech issue. If the transaction is indeed duplicate, there’s no need to do anything. If it’s not, contact your customer and their bank for help in transferring the money. 2 days
R25 Addenda error An error in the added information regarding the payment. Correct the information and retry the transaction. Next file delivery time following processing
R26 Mandatory field error A mandatory field is incorrect or unfilled. Correct it and retry the transaction. Next file delivery time following processing
R27 Trace number error The trace number is incorrect or unfilled. Correct it and retry the transaction. Next file delivery time following processing
R28 Routing number check digit error An error with the last digit of the routing number. Correct it and retry the transaction. Next file delivery time following processing
R29 Corporate customer advises not authorized The receiver doesn’t authorize the originator to deduct money from its account. Stop recurring payments and contact your customer. 2 days
R30 Receiving DFI not participant in check truncation program The receiving bank can’t accept the payment without the physical check. Contact your customer for an alternative payment method. Next file delivery time following processing

 

R31 Permissible return entry (CCD and CTX only) The receiving bank asks to return a CCD or CTX payment. Contact your customer for permission to credit their account. Undefined
R32 RDFI non-settlement The receiving bank wasn’t able to settle the entry. Contact the receiving bank for more information. Next file delivery time following processing
R33 Return of XCK (converted check) entry The original check was lost, destroyed, or its image was otherwise unable to be processed. Ask your customer for an alternative payment method. 60 days
R34 Limited Participation DFI The state or federal supervisor restricted the receiving bank’s participation in the ACH network, so this entry can’t be accepted. Contact your customer for an alternative payment method. Next file delivery time following processing
R35 Improper debit entry The debit entry was submitted incorrectly. Contact the bank to resolve this, or your customer for an alternative payment method. Next file delivery time following processing
R36 Improper credit entry The credit entry was submitted incorrectly. Contact the bank to resolve this, or your customer for an alternative payment method. Next file delivery time following processing
R37 Source document presented for payment The electronic check gets returned because the physical check was already used for payment. Process the payment manually. 60 days
R38 Stop payment on source document A request to stop payment has been issued on an original document, like a paper check. Wait for the banks to solve this or contact your customer for alternative payment methods. 60 days
R39 Improper source document A source document, like a paper check, can’t be used for payment – for example, it’s not readable when scanned. Wait for the banks to solve this or contact your customer for alternative payment methods. 2 days
R40 Return for ENR entry An ACH return code that’s issued by a federal government agency. Only happens in transactions with federal agencies. Wait for instructions from the federal agency. Undefined
R41 Invalid transaction code The transaction code isn’t valid or appropriate for the account type. This only applies to the payment of federal benefits. Wait for instructions from the federal agency. Undefined
R42 Routing number / check digit error An error in the routing number in federal benefit payments. Wait for instructions from the federal agency. Undefined
R43 Invalid DFI account number There’s an error in the recipient’s account number during a transaction of federal benefit payments. Wait for instructions from the federal agency. Undefined
R44 Invalid individual ID number The ID number in a federal benefit payment transaction doesn’t exist. Contact the government agency you work with. Undefined
R45 Invalid individual or company name The name doesn’t match the receiving bank’s records or is otherwise invalid. Only relevant to government bank accounts. Contact the government agency you work with. Undefined
R46 Invalid representative payee indicator This code was entered incorrectly or not at all. Only relevant to government bank accounts. Contact the government agency you work with. Undefined
R47 Duplicate enrollment The federal government received a duplicate ENR entry from the same receiving bank. Contact the government agency you work with. Undefined
R50 State law affecting RCK acceptance The receiving bank is located in a state that doesn’t allow digital payments. Verify there wasn’t an error in the routing number part that indicates the state. If all’s correct, contact your customer to receive alternative payment methods. Undefined

 

R51 Item related to RCK entry is ineligible or RCK entry is improper There’s an issue with an electronic check. Contact the receiving bank for more information. Undefined
R52 Stop payment on item related to RCK entry The account holder asked that the check won’t be processed because of lack of funds, issue with the service or product, fraud suspicion, etc. Contact your customer for more information. 60 days
R53 Item and RCK entry presented for payment Electronic representation of a paper check that cannot be used for payment due to insufficient funds. Contact the receiving bank for more information. 60 days
R61 Misrouted return The receiving bank routed the payment incorrectly. Contact the receiving bank. 60 days
R62 Return of erroneous or reversing debit The transaction’s receiver was incorrectly credited. Contact the receiving bank for more information. 5 days
R63 Incorrect dollar amount The dollar amount specified in the transaction is not correct. Correct the amount and retry the transaction. 1 day
R64 Incorrect individual identification The individual ID number in the return transaction does not match the ID number in the original entry. Correct the information and retry the transaction. 1 day
R65 Incorrect transaction code The transaction code is wrong for the type of transaction. Correct the information and retry the transaction. 1 day
R66 Incorrect company identification The company ID in the transaction does not match the one in the batch header record.  Correct the information and retry the transaction. 1 day
R67 Duplicate return The bank issuing the transaction received more than one refund for the same transaction. Contact the receiving bank, which issued the refunds. Undefined
R68 Untimely return The money wasn’t sent within Nacha’s established timeframe. Contact the receiving bank. 5 days
R69 Field error One of the fields was filled incorrectly by the initiating bank. Contact the bank that initiated the payment. 5 days
R70 Permissible return not accepted / not requested by OFDI A mix in records between the initiating and receiving banks – in regards to R31 ACH return code. Contact both banks. 5 days

 

R71 Misrouted dishonored return The initiating bank wrote the routing code incorrectly. Contact the initiating bank. 5 days
R72 Untimely dishonored return The originating bank didn’t send a dishonored return within Nacha’s timeline requirements. Contact the originating bank. 5 days
R73 Timely original return The receiving bank is currently verifying that the transaction return was processed within Nacha’s timeline requirements. Contact the receiving bank. 5 days
R74 Corrected return The receiving bank is currently correcting ACH return code R69. Wait for the receiving bank to finish this task. If the problem continues, reach out to the bank. Undefined
R75 Original return not a duplicate The assumption that using R67 (duplicate return) was needed was incorrect. It wasn’t, in fact, a duplicate return. Wait for the receiving bank to fix the issue, or contact it for more information. 5 days
R76 No errors found The receiving bank is contesting a dishonored return entry from the originating bank. Wait for the receiving bank to fix the issue, or contact it for more information. 2 days
R77 Non-acceptance of R62 dishonored return The receiving bank is contesting ACH return code R62. Contact the receiving bank. 2 days
R80 IAT (international ACH transaction) coding error Something in the IAT coding is incorrect. Contact the receiving bank. 2 days
R81 Non-participant in the IAT program The gateway doesn’t have an agreement with the originating bank or the customer to transfer international payments. Contact your customer for alternative payment methods. 2 days
R82 Invalid foreign receiving DFI identification The identifier of a foreign receiving bank is invalid. Correct the information and retry the transaction. 2 days
R83 Foreign receiving DFI unable to settle The foreign receiving bank couldn’t settle the transaction. Contact the receiving bank. 2 days
R84 Not processed by gateway The transaction can’t be processed by the receiving bank. Contact the receiving bank. Undefined
R85 Incorrectly coded outbound international payment While the international transaction has been issued, the associated SEC code doesn’t provide enough information to comply with regulations. Contact the originating bank. 2 days

 

What to do when you receive an ACH return code

Many businesses and individuals will experience payment challenges at some point. The codes can guide us to understand why this happened and how to make things right.

For businesses

Start by setting alerts to ensure you’re notified when payments fall through, and can take action as soon as possible. When you see and alert, check out the code to identify the reason. Then, take the recommended action. For example:

  • Get in touch with the payer, receiver or financial institution to dig deeper into it or ask them to make a change.
  • Make a change yourself. If you had a typo in the account information you provided, for example, try again.

Either way, keep track of all of this and analyze trends if this keeps happening. It’s possible a change in your process (like giving the payment task to a more detail-oriented employee or automating payment management with software) is necessary.

For individuals

Just like in business, it’s important for each of us to be on top of our personal finances. When you send out a payment, or expect one to show up in your account, set yourself a reminder to verify everything went through well.

If it didn’t, and you do receive a return code, check the table above to understand why it happened and what to do about it. Take action as soon as you can, and it hopefully won’t impact you beyond this temporary discomfort.

How to avoid ACH return codes

Sometimes, things happen and businesses get ACH return codes. But to set your business up for success, try to avoid common mistakes that trigger this.

  • Review account information before submitting the payment. Business professionals are inundated with tasks, so it’s easy to overlook this, but this little step can save you a lot of hassle.
  • Set transaction limits so you don’t accidentally transfer more per transaction or per day than what’s allowed.
  • Get written permission, especially for recurring payments, to verify you can prove the legitimacy of the transaction.

Illustration with three cartoon figures showing tips to avoid ACH return codes: review account information, set transaction limits, and get written permission.

Role of ACH return codes in the payment process

The role of the code is simple: It tells you why the payment fell through, and what you can do to fix the situation. In most cases, there’s no need to wait for an extensive investigation – just look at the code table and you’ll know your next step.

How do ACH return codes work in practice?

Here’s how ACH return codes work:

  • When the ACH payment is made, money gets transferred from the initiating financial institution to the automated clearing house.
  • Within one to three business days, the payment gets transferred to the receiving account. One of the advantages of ACH paymentsis that there’s time to verify everything is OK with the transaction (which helps make ACH safer than wire transfers).
  • If the payment can’t be transferred, it gets returned to the initiating account.
  • The financial institution provides an ACH return code – the letter R with a number (say, R02 or R39).
  • The code tells you the reason the payment fell through. 

How much is the ACH return fee?

An ACH return fee usually costs $2-5. The entity getting charged is the one trying to make the payment.

However, the receiving business needs to be on the lookout, too. It must keep ACH return rates under 15% for every 60 days to stay compliant and avoid consequences from Nacha, which governs ACH payments. The “fee” here could be losing your ability to accept ACH payments.

Reduce ACH return codes with easily trackable payment management

Efficient business finance management is critical for long term business continuity, but managing all the aspects that go into that is complicated.

Melio was founded to help with exactly that  complexity – to simplify these processes for businesses and help them thrive. Our  ACH solutions are cost-effective, secure and put an end to the guesswork. Try it here, and let’s amplify your payment operations.

*This blog post is intended for informational purposes only and is not intended as financial advice.
**Melio does not provide legal, tax or accounting advice, and you should consult with a professional advisor before making any financial decisions.

Read more