ACH Return Code R23 Meaning: Credit Refused by Receiver Guide

R23 means “Credit Refused by Receiver.”

The receiving bank is telling the ACH network that the account holder does not want to accept the incoming credit.

Unlike insufficient funds or wrong account numbers, this return is based on the receiver’s decision.

When R23 Usually Happens

1. Account Holder Asked the Bank to Block Deposits

The person may have instructed their bank not to accept ACH credits.

This sometimes happens during disputes or account reviews.

2. Payment Sent to the Wrong Person

If money is accidentally sent to someone else, that person can refuse the deposit.

3. Business or Vendor Refuses Payment Method

Some companies reject ACH credits if they require payment by another method such as wire transfer or check.

4. Account Under Review or Special Restrictions

Banks sometimes allow customers to temporarily refuse incoming electronic credits.

How To Fix ACH Return Code R23

Follow this simple process.

Step 1 — Contact the Receiver Immediately

Ask whether they intentionally refused the payment.

Do not resend until you confirm.

Step 2 — Verify Banking Details

Confirm:

• Account number

• Routing number

• Account type

• Permission to receive ACH credits

Step 3 — Use an Alternate Payment Method if Needed

If the receiver does not accept ACH credits, consider:

• Wire transfer

• Paper check

• Approved payment platform

Important Compliance Note

Never repeatedly resend an ACH credit after an R23 return without confirmation.

Doing so can:

• Trigger banking compliance flags

• Increase processing fees

• Delay payroll or vendor payments

Always confirm acceptance first.

Is ACH R23 a Fraud Warning

No.

R23 does not automatically mean fraud.

It simply indicates the receiver declined the payment.

However, businesses should still verify identity and payment instructions before retrying.

Conclusion

ACH return code R23 means the receiver refused to accept the credit.

Most of the time, this happens due to bank instructions, payment disputes, or incorrect recipient details.

Once you confirm the correct account and permission to receive ACH transfers, the issue can usually be resolved quickly.

Understanding R23 helps businesses avoid repeated failed deposits and keep payments running smoothly.