R85

What Is ACH Return Code R85?

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 R85, also known as “Incorrectly Coded Outbound International Payment," is a standard code used in Automated Clearing House (ACH) transactions. This code indicates that the RDFI can confirm that a transaction is an outbound international payment, but the associated SEC code doesn’t provide the necessary information required by the gateway for OFAC compliance.

An IAT (International ACH Transaction) is a specific type of ACH (Automated Clearing House) transaction used for cross-border payments involving accounts held at financial institutions outside the United States. The IAT format allows for the electronic transfer of funds internationally, providing a standardized and efficient means for processing cross-border payments.

The Office of Foreign Assets Control (OFAC) is a financial intelligence and enforcement agency under the jurisdiction of the US Treasury Department. Its job is to enforce economic and trade sanctions in alignment with US foreign policy and national security goals.

How To Address ACH Return Code R85

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.

If you encounter R85, you will need to reach out to the ODFI to let them know about the SEC code being incorrect. You should then be able to update the code and reattempt the transaction.

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.