NACHA Rule Change

March 2015: Removal of Notification of Change (C04 Change Code) and Rule Changes Related to Dishonored Returns

Effective March 20, 2015

Removal of Notification of Change - C04 Change Code (Incorrect Individual Name/Receiving Company Name)

Previously, Receiving Depository Financial Institutions (RDFIs) would send a Notification of Change – C04 to request a correction to the Receiver’s name on future ACH transactions. This sometimes created challenges for Originators, ODFIs and RDFIs. An example was when the Biller (Originator) could not make the requested name change due to contractual or other reasons while the Original Depository Financial Institution faced NACHA violations for not updating the name. To eliminate this risk the C04 code will be removed as a valid change code.

Impact to ODFIs / Originators

If you are an ACH Originator and the Receiver’s name on the ACH transaction and Receiver’s name at the RDFI do not match, rely on contracts and records to properly identify the name of the Receiver being credited or debited, without relying on a Notification of Change (NOC) from the RDFI

Impact to RDFIs

When the RDFI discovers a name mismatch, choose one of the following courses of action:

  • Post the Entry based solely on account number.
  • Return the Entry as R03.
  • Assist the Receiver by communicating directly with the ODFI/Originator.

Effective March 20, 2015

Dishonored Returns and Contested Dishonored Returns Related to an Unintended Credit to a Receiver

There are two new return codes to assist Originators, ODFIs, and RDFIs to rectify situations in which the reversal process resulted in, or didn’t resolve unintended credit to the Receiver.

Originators and ODFIs can use the new R62 (Return of Erroneous Debit or Reversing Debit) only in the following situations:

  • When a debit Erroneous Entry and a subsequent credit Reversing Entry are both transmitted to the Receiver’s account, but the erroneous debit is returned while the reversing credit is posted and made available to the Receiver.
  • When a credit Erroneous Entry and a subsequent debit Reversing Entry are both transmitted to the Receiver’s account, but the reversing debit is returned while the erroneous credit is posted and made available to the Receiver.

If you are an ACH Originator, you can request that your ODFI dishonor a return in order to correct and resolve an erroneous or unintended credit to a Receiver.

In addition, ensure that R62 is only used when the associated credit entry (the Reversal or the erroneous credit) was not also returned by the RDFI.

RDFI’s can use the new Contested Dishonor R77 (Non-Acceptance of R62 Dishonored Return) if either of the following situations exist.

  • the RDFI returned both the erroneous entry and the reversal entry to the ODFI
  • the RDFI was unable to recover the funds from the Receiver


ABC Company sends two ACH Credit transactions to Receiver A in error and subsequently sends a reversing ACH Debit to Receiver A to correct the error. Both ACH Credit transactions post to Receiver A’s account. If Receiver A returns the reversing ACH Debit to ABC Company and keeps the erroneous ACH Credit, ABC Company can dishonor the return of the reversing ACH Debit with an R62 return reason code. However if Receiver A’s Bank returned both the erroneous ACH Credit and the reversing ACH Debit to ABC Company or if Receiver A no longer has the available funds in their account, then Receiver A’s Bank can Contest the Dishonored Return with an R77 reason code.

Important Legal Disclosures and Information

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