Most businesses processing Automated Clearing House (ACH) payments have probably been in a situation where the payment doesn’t go through. If that happens, an error usually occurs that displays an ACH return code containing the error message. In this article, we’ll be looking further into why an ACH Return Code R34 happens and a solution to it.
Let’s start things off by explaining what ACH payments are. An Automated Clearing House payment, or ACH for short is one of the methods for electronic funds transfer (EFT). To send an ACH payment you’ll need the bank account number and the routing ACH number of the receiver. It’s worth mentioning that this payment method is only available to institutions in the United States.
The National Automated Clearing House Association (NACHA) is the governing body behind the ACH network in the U.S. This basically means that NACHA oversees every ACH transaction and returns ACH codes if an error occurs.
Businesses are fond of this payment method because ACH processing fees are often lower than the processing fees of other methods. However, payments aren’t always successful and sometimes you end up with an ACH return code. There are a total of 85 different ACH return codes, one of which is the R34 ACH return code.
What does ACH Return Code R34 Mean?
The ACH R34 code indicates that a federal or state regulator has somehow limited the RDFI’s (Receiving Depository Financial Institution) participation. This can mean two things: (1) the regulator in question has completely denied the participation of the RDFI; or (2) the regulator has limited RDFI participation to some extent.
The RDFI is the institution on the receiving end of the ACH payment. ODFI (Originating Depository Financial Institution) is the institution that initiates the payment. There are many possible reasons why the regulator is limiting the RDFI. For this information, you’ll have to get in touch with someone from the RDFI.
The formal definition for ACH return code R34 is as follows: Limited Participation DFI: RDFI participation has been limited by a federal or state supervisor.
Solutions to Fix R34 Return Code
It’s not clear why this return code generates so it is best to contact the RDFI directly for more information. What you’re looking for is the RDFI’s ACH operations group. Professionals will tell you what the issue is and the possible solution. It should be mentioned that since a state or federal supervisor is limiting the RDFI, the institution may be seeing suspicious activity or is completing an audit.
In the end, it’s all up to the RDFI to decide on a solution for your case of ACH return code R34. Providing all the necessary information to the RDFI will get you back to accepting ACH payments.