ACH Return Code R20 Meaning: Non-Transaction Account Error Guide

R20 means “Non-Transaction Account.”

This happens when an ACH payment is sent to an account that is not allowed to receive electronic transfers.

Examples of non-transaction accounts include:

• Loan accounts

• Investment accounts

• Some savings accounts with restrictions

• Internal bank-only accounts

These accounts are not designed for everyday deposits or withdrawals through ACH.

Why the R20 Error Happens

There are a few common reasons.

1. Payment Sent to the Wrong Account Type

Someone may accidentally provide a loan account number instead of a checking account.

This is the most common cause.

2. Savings Account With ACH Limits

Some banks restrict ACH deposits to certain savings products.

If the account does not support transactions, the bank rejects it.

3. Data Entry Mistake

If digits are typed incorrectly, the number might match an internal or non-transaction account at the bank.

How To Fix ACH Return Code R20

Follow these steps.

Step 1 — Contact the Payment Receiver

Ask them to confirm:

• Correct account number

• Correct routing number

• Account type (checking usually safest)

Step 2 — Request a Transaction-Enabled Account

If they gave a loan or restricted savings account, request a:

✔ Checking account
✔ Standard savings account that allows ACH

Step 3 — Retry the Payment Only After Verification

Do not resend immediately.
Always confirm the correct details first.

Repeated failed attempts can trigger bank compliance warnings.

How Businesses Can Prevent R20 Errors

To reduce ACH failures:

• Always collect account type (checking or savings)

• Use bank verification tools when possible

• Ask employees to submit a voided check for payroll

• Reconfirm bank details before large payments

These simple checks prevent most R20 returns.

How Serious Is an R20 Return

R20 is not a fraud warning and does not mean the account is closed.

It simply means the account cannot process ACH transactions.

Once corrected, payments usually go through normally.

Conclusion

ACH return code R20 means the payment was sent to a non-transaction account that cannot accept ACH transfers.

In most cases, the solution is just confirming the correct checking or eligible savings account and resending the payment.

If you handle payroll, vendor payments, or direct deposit, understanding R20 helps you resolve transfer failures quickly and keep payments on schedule.