ACH Return Code R27

The ACH Return Code R27 indicates a trace number error, which can lead to payment failures if not addressed promptly. The trace number, a unique 15-digit identifier assigned to each transaction, tracks and reconciles payments within the NACHA framework. 

When this number is missing or incorrect, financial institutions may struggle to resolve issues related to the transaction.

What Is an ACH Return Code

ACH return codes serve as a standardized method for identifying reasons behind unsuccessful ACH transactions. It helps the Originating Depository Financial Institution (ODFI) and the Receiving Depository Financial Institution (RDFI) talk clearly during electronic transfers.

In ACH payment processing in the United States, these codes offer insights into why a payment may not have gone through. When an ACH payment fails, a specific return code is generated, which helps businesses understand the underlying issues and aids in correcting them.

There are a total of 85 unique ACH return codes, each beginning with the letter 'R' followed by a two-digit number.

What Is ACH Return Code R27

The ACH Return Code R27 refers to a specific trace number error definition indicating issues with the trace number associated with a transaction. This code highlights that either the original entry trace number is absent in the addenda record or there exists a mismatch between the trace number of the addenda and that of the preceding entry detail record. 

Each ACH transaction is assigned a unique trace number by the ODFI, consisting of eight digits that represent the routing and/or transit number, followed by seven digits indicating a sequence number assigned by the originator.

If a business attempts to process a debit without an accurate trace number, the bank will reject the transaction, resulting in a failure.

How to Fix ACH Return Code R27

Resolving ACH Return Code R27 typically begins with identifying and correcting the underlying issue, which often relates to a trace number error. Enter the original entry trace number in the addenda record of the return or notification of change entry. This step ensures that the transaction can be processed correctly upon resubmission.

Next, check whether the trace number included in the addenda record matches the trace number of the preceding entry detail record. If there is a discrepancy, it is essential to adjust both numbers to ensure they correspond accurately.

While correcting trace number errors can be frustrating, they are usually straightforward to fix, allowing you to continue handling ACH transactions with minimal disruption. Consistently adhering to proper tracing protocols will also help mitigate the risk of encountering the same issues in future transactions, streamlining your overall payment processing experience.