What is an ACH return? How do I prevent them?
An ACH return is when a bank rejects an automated clearinghouse (ACH) transaction. This can happen for a variety of reasons, such as when the account information provided is incorrect or when there isn’t enough money in the account to cover the transaction.
If you’re experiencing a high number of ACH returns, it may be the result of inaccurate or incomplete account information being provided to the payer. You can help prevent ACH returns by making sure that you have your customer’s account information exactly right, including their name, address and other details.
If you’re a merchant who has just launched an ecommerce site, it may be difficult to determine if incorrect account information is being provided. If the payments are being processed through your merchant account, you’ll want to reach out to your payment processor to let them know about these issues. They can help determine if the incorrect information is due to user error or an issue with how you’re collecting account information.
A payment processor may be able to provide additional insight into why an ACH return is occurring. If it appears that the issue is with how you’re collecting account information, they may be able to help by suggesting a different method of capturing this data. For example, if you’re currently using a form on your website to collect this information, they may suggest using a third-party service like Authorize.net to take the information instead.
A payment processor can also help you determine if your merchant account is experiencing an unusually high number of ACH returns over time. These overages may be identified as instances where returned transactions outnumber successful transactions, resulting in a chargeback ratio that is higher than normal for your business. Merchants who are meeting or exceeding the industry standard for chargeback ratios may not need to worry about this information. However, if your business is seeing a higher than average number of returns, you’ll want to take steps to ensure that you can get these returned transactions under control.
It’s also possible that the merchant account itself could be at fault. If it has been determined that the account is not accurately processing ACH transactions, the account may need to be upgraded to a more specialized type of account that can handle these types of payments. This can help prevent future ACH returns from occurring.
If you’re still experiencing issues with ACH returns after taking these steps, it’s important to reach out to your payment processor for additional assistance. They may be able to provide you with a plan of action to help get your returned transactions under control.
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