R38

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High-Priority Return Code

This ACH return code is specific to ARC (Accounts Receivable Conversion) entries and indicates that the customer has placed a stop payment order on the original paper check that was converted into an electronic ACH transaction. This return code serves as a safeguard when stop payment systems for checks and ACH aren't fully integrated, allowing customers to halt payment on the source document even after electronic conversion has begun.

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Error message: "The RDFI determines that a stop payment order has been placed on the source document to which the ARC entry relates."

What Causes ACH Return Code R38?

The R38 ACH return code means "Stop Payment on Source Document" and indicates that a customer has placed a stop payment order on the original paper check that was subsequently converted into an ARC (Accounts Receivable Conversion) entry. This occurs when businesses convert received checks into electronic ACH transactions, but the customer has separately instructed their bank to stop payment on that specific check.

R38 returns happen when there are timing issues or system disconnects between traditional check stop payment processes and ACH conversion systems. The customer may have valid reasons for stopping payment (such as disputing goods or services), and this return code ensures their stop payment instruction is honored even when the check has been converted to electronic format.

Can You Retry R38 Payments?

You cannot retry R38 payments because the customer has explicitly instructed their bank to stop payment on the original check. You must contact the customer directly to understand why they stopped payment and work to resolve the underlying issue before seeking alternative payment arrangements.

Common Causes

Customer placed stop payment order on original check after it was mailed or delivered

Dispute over goods or services that prompted customer to stop payment

System delay between check conversion and stop payment processing

Disconnected stop payment systems between check and ACH processing

Customer realized check was issued in error and stopped payment

Key Information

Return timeframe: Up to 60 calendar days following settlement date

Specific to ARC (Accounts Receivable Conversion) entries only

Cannot be resolved at merchant level - requires banking institution coordination

Customer can request immediate credit from RDFI

Requires written customer statement under penalty of perjury

How to Respond to an R38 Code

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An R38 return indicates the customer intentionally stopped payment on the original check, requiring direct communication to understand and resolve the underlying payment dispute or issue.

When Your Customer's Payment Fails

Contact Customer Immediately
Reach out to understand why they placed a stop payment order on their check and work to resolve any underlying issues.
Do Not Retry the Same Payment
Since the customer explicitly stopped payment, attempting to reprocess would violate their payment instruction.
Investigate the Root Cause
Determine if the stop payment was due to disputes over goods/services, billing errors, or other legitimate concerns.
Seek Alternative Resolution
Once the underlying issue is resolved, request a new payment method or new check from the customer.

Email Template

Subject: Payment Processing Issue - New Payment Method Needed

Hi [Customer Name],

We received notification that you placed a stop payment order on your recent check payment. We want to make sure we understand and resolve any concerns you may have.

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Could you please contact us to discuss why the stop payment was necessary? We're committed to addressing any issues with your order, billing, or service and want to ensure your complete satisfaction.

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Once we resolve any concerns, we can discuss the best way to complete your payment. We appreciate your business and want to make this right.

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Please call us at your earliest convenience.

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[Your Company Name]

When Your Payment to Vendors Fails

An R38 return on vendor payments means the vendor placed a stop payment order on their check after you converted it to electronic format. This requires immediate communication to understand why they stopped payment and resolve any underlying issues.

Contact the vendor immediately to understand why they placed a stop payment order on their check
Investigate whether there are disputes over goods, services, or payment amounts that need resolution
Work with the vendor to resolve any underlying issues before seeking alternative payment methods
Request a new form of payment once the stop payment concerns have been addressed