ACH Debit late return

Late returns must be contested or repaid via the sponsor bank to the destination bank

When a destination bank changes the response for an ACH Debit from confirmed to returned, it's called a 'late return'. Late returns initiated by customers are similar to charge backs on cards.

The initial status is confirmed, which means the destination bank sent the funds to the sponsor bank, and the sponsor bank paid out the funds to your creditor bank account. This is regardless of whether or not the customer's bank account contained the funds.

The new status is returned, which means the destination bank wants the funds back from you.

• If the new response is insufficient balance, it cannot be contested and must be refunded to the destination bank. If you're using our sponsor bank, we'll email you asking you to send the funds to the sponsor bank.

• If the new response is for any other reason e.g. the customer (debtor) is contesting the basis of the charge, you can contest it by providing evidence of your contractual relationship with the customer.