R02

What is ACH Return Code R02?

ACH return codes are used to identify the reason an ACH payment has been returned by the recipient's bank. They make it easier for originating and receiving financial institutions to spot and communicate payment failures.

ACH Return Code R02, known as "Account Closed," is a standard code used in Automated Clearing House (ACH) transactions to indicate that a payment or transfer was unsuccessful because the designated bank account has been closed. If you experience return code R02, then the account that you are trying to transact with via ACH has been closed and can no longer be used to process payments.

How To Address ACH Return Code R02

Nacha prescribes separate rules for handling each return code since each one represents a unique scenario. ODFIs (Originating Depository Financial Institutions) and RDFIs (Receiving Depository Financial Institutions) are responsible for handling ACH return codes according to these rules.

For example, if your business is attempting to initiate an ACH debit for $100, but the customer you are debiting has closed the account you are debiting, the bank would return the transaction with code R02. The customer’s bank must return the transaction with code R02 within 2 banking days.

To address R02, the easiest first step is to contact your customer directly and ask them to update their account information so that you can process the transaction. If that does not work, you may need to reach out directly to their financial institution for more information and assistance.

What Is An ACH Return Code?

ACH return codes identify the reason an ACH payment was returned by the recipient's bank. They make it easier for originating and receiving financial institutions to spot and communicate payment failures. Each code begins with 'R' followed by a two digit number. ACH return codes are standardized and maintained by NACHA, the governing body for the ACH network.