Return Codes

Some of the most common questions we get with the ACH returns process are:

We will be the first to admit that the ACH returns process is complex—at best. In an attempt to make it easier to understand, we’ve answered these questions and provided some of the more common ACH return codes.

What are ACH Returns?

An ACH return is a credit or debit entry that is typically initiated by a Receiving Depository Financial Institution (RDFI) that returns a previously originated credit or debit entry to the Originating Depository Financial Institution (ODFI) within the time frames established by Nacha rules.

The ODFI is the financial institution ACHQ uses to process ACH transactions on behalf of our customers.

Why Would I Receive an ACH Return?

ACH returns are a normal part of ACH processing and allow receivers and RDFIs to notify originators and ODFIs when a transaction does not go as intended. These are indicated by a three character alphanumeric return code.

Common ACH Return Codes

There are nearly 70 unique return codes, which help the originator of the transaction determine why an item has been returned. Each return code is specific to certain entry types and has specific time frames for return (more on that later).

The most common ACH return codes in the ACHQ network are:

Reason for ReturnReturn CodeDescriptionEntry TypeTime Frame
Insufficient FundsR01Available balance is not sufficient to cover the dollar value of the debit entry.ALL2 banking days
Account ClosedR02Previously active account has been closed.ALL2 banking days
No Account / Unable to Locate AccountR03Account number structure is valid, but doesn’t match individual identified in entry or is not an open account.ALL2 banking days
Invalid Account NumberR04Account number structure is not valid.ALL2 banking days
Unauthorized Debit to Consumer Account Using Corporate SEC CodeR05A debit entry was transmitted to a consumer account that was not authorized by the Receiver. Written Statement is required.CCD, CTX (consumer only)60 calendar days
Authorization Revoked by CustomerR07Consumer who previously authorized entries has revoked authorization with the Originator. Written Statement is required.PPD, TEL and WEB60 calendar days
Payment StoppedR08The Receiver has requested the stop payment of a specific ACH debit entry.ALL2 banking days
Uncollected FundsR09Sufficient balance exists, but value of uncollected items brings available balance below amount of debit entry.ALL2 banking days
Customer Advises Originator is Not Known to Receiver and/or Originator is Not Authorized by Receiver to Debit Receiver’s AccountR10Receiver has no relationship with the Originator or has not authorized the Originator to debit the account.Written Statement is required.ALL DEBIT ENTRIES (except CCD, CTX and RCK)60 calendar days
Customer Advises Entry Not in Accordance with the Terms of the AuthorizationR11The debit entry was inaccurate or improperly initiated. Other reasons include source document was ineligible, notice was not provided to the receive or amount was inaccurately obtained. Written statement is required.ALL DEBIT ENTRIES (except CCD, CTX and RCK60 calendar days
Account FrozenR16Funds unavailable due to action by the RDFI or legal action.ALL2 banking days
Non-Transaction AccountR20RDFI policies/regulations restrict activity to account.ALL2 banking days
Corporate Customer Advises Not AuthorizedR29Receiver has notified RDFI that corporate debit entry transmitted to a corporate account is not authorized.CCD, CTX2 banking days

Internal Return Codes

If ACHQ detects an attempted payment on a known bad account, the ACHQ detect system will automatically block the payment from processing and assign an internal return code. Values and scenarios are as follows:

Return CodeReason
D01Duplicate Transaction
S01Invalid routing number
S02Known bad account number
S10Invalid account number
S11Previous R02, R03, R04, R16 or R20
S12Previously Returned R05, R07, R08, R10, R11, or R29
S13Invalid ODFI Credentials

If you believe a transaction was rejected in error, please contact your support representative to request an unblock

Explaining the Entry Types & Time Frames for an ACH Return

Another way to classify ACH transactions is by something called a Standard Entry Class (SEC) Code. This is a three-letter code enabling a financial institution (FI) to identify the purpose of a transaction. The majority of ACHQ clients are set up as either WEB (a credit or debit entry initiated online or via mobile device to a consumer’s account) or CCD (a credit or debit entry used to facilitate business-to-business payments).

Some ACH return codes apply to all SEC codes, while others are specific to certain types.

The majority of return codes have a two banking day turnaround time. However, unauthorized debits to consumer accounts typically have a 60 calendar day return time frame, meaning a consumer can dispute a transaction as unauthorized during this time period.

Banking regulations are typically very consumer-friendly, which is why this time frame is longer for an unauthorized debit to a business account using a CCD SEC Code (two banking days).

What if my customer claims a transaction was unauthorized and I receive a return for an item, but I believe the transaction was in fact authorized?

According to the Nacha rules, as long as the consumer signs a Written Statement of Unauthorized Debit for certain return types (see chart above), the RDFI must return the item and the ODFI must accept the return.

If you believe the transaction was authorized, refer to your user agreement / customer contract to see what recourse you have. At that point, collections must be settled outside of the ACH Network.

How do I know if we receive an ACH Return?

Using ACHQ’s API allows a business to systematically receive a notification with links to additional information when certain activities—such as ACH returns—occur.

Is there anything else I need to be aware of in regard to ACH returns?

Yes. According to Nacha, ACH debit returns must stay below specific thresholds:

  • Administrative Returns must stay below three percent. This percentage is calculated based on ACH debit returns for the preceding 60 days on the following return reason codes: R02, R03 and R04.
  • Unauthorized Returns must stay below 0.5 percent. This percentage is calculated based on ACH debit returns for the preceding 60 days on the following return reason codes: R05, R07, R10, R29 and R51.
  • Overall Returns must stay below 15 percent. This percentage is calculated based on ACH debit returns for the preceding 60 days and includes all return reason codes.
  • NSF Returns have no specific threshold by themselves; however, these returns contribute to the Overall Return rate (see above) and make up the largest number of returns, by volume. NSF Returns include R01 and R09.

Dishonoring ACH Returns

ACHQ is able to request the ODFI send back (or dishonor) a return if it meets any of the following qualifications:

  • Was Untimely (not within the proper time frames for return)
  • Contained Incorrect Information
  • Was Misrouted
  • Was a Duplicate
  • Resulted in an Unintended Credit to the Receiver Related to the Reversal Process.

A dishonored return must be transmitted within five banking days of the settlement date of the return. Please be aware that the RDFI is able to contest a dishonored return, in which case recovery of the funds would need to happen outside of the ACH Network.


Return codes can happen, regardless of how many safeguards are in place. At ACHQ, we help our clients understand the ACH returns process so they’re able to utilize our payments platform to its full potential.