R23

On This Page

High-Priority Return Code

This ACH return code indicates that the account holder or receiving bank (RDFI) has deliberately refused to accept a credit entry transaction. Unlike technical errors, R23 represents an intentional rejection by the receiver for business reasons such as incorrect amounts, unauthorized transactions, or account restrictions. The RDFI must transmit this return immediately upon receipt of the refusal.

‍

Error message: "The receiver has returned the Entry, i.e., because the minimum amount hasn't been remitted, exact amount not received, account subject to litigation, overpayment situation, or receiver doesn't recognize the originator."

What Causes ACH Return Code R23?

The R23 ACH return code means "Credit Entry Refused by Receiver" and indicates that the account holder or their bank has actively declined to accept a credit transaction you attempted to send. This is fundamentally different from technical errors or insufficient funds—it represents a deliberate business decision by the receiver to reject the incoming payment.

This return code serves as a communication mechanism between the receiver and the sender when credit entries don't meet specific requirements or expectations. The receiver may refuse credits to avoid overpayments, reject unauthorized transactions, or decline amounts that don't match their records. Understanding why a credit was refused helps maintain proper business relationships and resolve payment disputes.

Can You Retry R23 Payments?

You can potentially retry R23 payments after contacting the receiver to understand why they refused the credit and addressing their specific concerns. However, you should not automatically resubmit without resolving the underlying issue that caused the initial refusal.

Common Causes

Minimum required payment amount was not met by the credit entry

Credit amount doesn't match the exact amount expected by receiver

Account is currently subject to litigation or legal restrictions

Accepting the credit would result in an overpayment situation

Receiver doesn't recognize the originator or transaction purpose

Key Information

Return timeframe: Immediate upon receipt of refusal by RDFI

Cannot retry without addressing receiver's specific concerns

Represents intentional rejection, not technical error

Requires direct communication with receiver to resolve

More common with business-to-business transactions

How to Respond to an R23 Code

‍

An R23 return requires direct communication with the receiver to understand their specific reason for refusing the credit and resolve any underlying issues.

When Your Customer's Payment Fails

Contact the Receiver Immediately
Reach out to understand exactly why they refused the credit entry and what their expectations are.
Verify Transaction Details
Confirm the correct amount, purpose, and authorization requirements with the receiver.
Address Specific Concerns
Resolve any issues related to amount discrepancies, authorization, or business requirements.
Obtain Proper Authorization
Ensure you have explicit permission and correct details before resubmitting any credit.

Email Template

Subject: Credit Payment Refused - Clarification Needed

Hi [Receiver Name],

‍

We attempted to send you a credit payment that was refused by your bank. To ensure we process your payment correctly, we need to understand the specific reason for the refusal.

‍

Could you please verify:

The correct amount you're expecting
Any specific authorization requirements
Whether there are restrictions on your account

We want to resolve this quickly and ensure you receive the payment you're entitled to. Please let us know how we can correct this situation.

‍

Thanks,

‍

[Your Company Name]

When Your Payment to Vendors Fails

An R23 return on vendor payments means the vendor has refused your credit payment. This requires immediate communication to understand their requirements and resolve the issue.