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An Automated Clearing House (ACH) return code is a three-digit numeric code used to notify the sender of a transaction about the outcome of their payment.
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Everything You Need To Know About ACH Return Codes! An Automated Clearing House (ACH) return code is a three-digit numeric code used to notify the sender of a transaction about the outcome of their payment. ACH return codes are divided into ‘R’ codes and ‘C’ codes. R stands for Return, while C stands for Correction.
R codes are used when a payment is rejected and returned to the originator, while C codes are used when corrections need to be made to the transaction. R codes are assigned by the receiving financial institution in order to indicate why the transaction was not accepted or processed correctly. Examples of common ACH return codes include R01 (Insufficient funds), R03 (No account/unable to locate account), and R06 (Returned per ODFI’s request).
C codes are assigned by the originator of a transaction in order to indicate when they need to make corrections or changes to the information associated with their payment. Examples of common ACH return codes include C01 (Incorrect name or account number), C02 (Improperly formatted transaction), and C03 (Incorrect amount).
Knowing what all the ACH return codes mean is important, as it helps you identify potential payment errors and quickly make corrections in order to ensure that your transactions are processed correctly. It’s also a good idea to review the ACH return codes periodically to make sure you’re familiar with them.
By being proactive and understanding the most common ACH return codes, you can help reduce payment processing errors and keep your accounts running smoothly. If you have any questions about ACH return codes, please don’t hesitate to contact your financial institution. They can provide detailed information about the codes and help you ensure that your transactions are processed successfully.
