Sometimes, changes to the Nacha Operating Rules come in two parts. Such is the case with the Rule on Differentiating Unauthorized Return Reasons, where the second part will be implemented soon.

First, let’s back up to when part one of the Rule took effect. Since April 1, 2020, RDFIs have been able to use return reason code R11 for a debit that had an authorization but contained an error, such as the wrong day or incorrect amount. That set them apart from R10 coded returns, which continue to be used when a consumer says a debit was unauthorized. The goal was to have RDFIs use the repurposed R11 code when the Originator and Receiver could both benefit from correcting an error, rather than ending the origination authorization.

On April 1, 2021, the second half of this Rule takes effect, as R11 returns become covered by the existing Unauthorized Entry Fee. 

“The two ACH Operators will implement this part of the Rule, and as with the current fee it will be billed or credited, as appropriate, on the Operators’ monthly statement of charges,” said Debbie Barr, Nacha Senior Director, ACH Network Rules Process & Communications.

“With part two of this Rule becoming effective in less than two months, now is the time for ODFIs to look at their volume of R11 returns to assess what the impact of the fees will be,” said Barr. “ODFIs should also discuss R11 returns with their Originators and determine ways to reduce these returns.” 

Download Nacha's PDF infographic on How to Calculate Unauthorized Return Rates.

Learn more about the Differentiating Unauthorized Return Reasons Rule.