ACH Dispute Handling

This section outlines how disputes are handled for ACH Debit (pull) and ACH Credit (push) transactions, as well as ACH Reversals.

ACH Pull is restricted across HIFI and a Developer must enter into an additional agreement to enable ACH pull.

ACH Debit (Pull Payments) Disputes

Overview

Disputes are initiated by the Receiver and processed through the ACH network as returns.

Common Reasons (Return Codes)

• Unauthorized Return codes(R05, R07, R10, R11, R29)

• Insufficient Funds Return code (R01)

• Invalid / Closed Account Return code(R02,R03,R04)

Timeframes

• Standard: 2 business days

• Unauthorized (consumer): up to 60 days

Handling

• Returns are automatically processed by the network

• Funds are debited from our account

• Client balances may go negative → covered by reserves

Controls

• Internal Return rate monitoring thresholds(originator-level):

  • Unauthorized: 0.20%

  • Administrative: 2%

  • Overall: 10%

• Breaches may trigger restrictions or suspension

Risk

• Sits with the client (originator)

• Mitigated via reserves and internal  monitoring

ACH Credit (Push Payments) Disputes 

Overview

Disputes are initiated by the Sender after funds have settled.
Credits cannot be automatically reversed.

Handling

1. Recall request received via our sponsor bank

2. Review:

   • Funds availability

   • Fraud / error context

3. Client notified (if applicable)

4. Decision:

   • Funds available → return processed

   • Funds unavailable → denied

5. Respond to bank

Controls (Critical)

• Debit blocks are in place, a manual review is conducted prior to returns being refunded. 

• Originators cannot pull funds back unilaterally

• All returns require our review + approval

Timing

• No guaranteed SLA (bank + client dependent)

Risk

• Sits with the sender

ACH Reversals (Correction Entries)

Overview

Reversals are new ACH entries sent by the originator to correct an error — they are not the same as returns or recalls.

When Reversals Are Allowed

• Duplicate payment

• Incorrect amount

• Wrong account

Timeframe

• Must be initiated within a 5-day window from the original transaction

Key Behavior

• Reversals are not guaranteed to succeed

• They are subject to:

  • Receiving bank controls

  • Account-level restrictions

Our Controls

• Debit blocks prevent automatic reversal debits

• Reversals cannot be forced into our accounts

• Any reversal requires:

  • Bank coordination

  • Internal review and approval

Important Note

• If a reversal is attempted against a blocked account:

  • It will fail

  • Originator must submit a formal recall request instead

Key Differences

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