“Here is your PRD printout with the check 21 return code. We are sorry we need to halt this check processing,” the teller says.
“Here’s what print and what code?” you respond, completely confused.
Don’t worry, we have all been there.
You may have tried depositing a check only to have it returned to you by the bank. Moreover, the bank returned some weird copies of the check with random numbers called check 21 return codes printed on them. How rude!
Well, the bank is not being rude. It is just being cautious.
Credit unions and banks have several mechanisms in place to prevent check fraud. They are extremely cautious with their consumer accounts to offer the best possible service. Therefore, to uphold the industry standards, and provide faster processing and more convenience to their clients, the Federal Reserve bank came up with the Check Clearing for the 21st Century Act, aka Check 21 Act, in October 2004.
The Different Types of Check 21 Return Codes
Today, we will be talking specifically about the Check 21 return code. If the bank rejects the check, these codes are printed on the returned item, that is, the PRD printout.
To understand it more simply, we will stick to one example. We will refer to the following legend to make things simpler:
- Issuer: Ian
- Issuing Bank: Ivy Bank
- Receiving Bank: Rory Bank
- Federal Reserve Bank: Fed
- Receiver: Ramona
For the sake of clarity, let’s say that Ian (who has a bank account with Ivy Bank) wrote a check to Ramona (who has an account with Rory Bank).
In case of any confusion, you can refer to this legend to understand the movement of checks.
A: Not Sufficient Funds
- About: This is the most common type of check 21 return code. In this case, Ian’s bank account does not have enough funds to uphold the value of the check. So, he is penalized for writing a check that he cannot pay for. To speed up the overall process, most banks like Rory Bank will assume that the check’s issuer has enough balance to make the necessary payment. So, without waiting for confirmation from Ian’s Bank, it will disburse the amount to Ramona’s account; however, if the check bounces due to the R01 return code, both Ian and Ramona can be penalized by their respective banks. In such a case, the fee incurred by the banks is called NSF fees. Relate this with R01 for the ACH payment solutions return code or an e-check return code. You can avoid costly unnecessary NSF fees by following this guide.
- Solution: Ian needs to ensure that he has enough funds in his account and reissue a check to Ramona. Some banks may allow Ramona to redeposit the check-up to two times before needing a new one. Ideally, Ian should check his monthly statement regularly to ensure that his checks don’t bounce due to the R01 return code.
B: Uncollected Funds Hold
- About: This is similar to the NSF case. However, there is one key difference. While in the NSF scenario, Ian’s bank account does not have an ample amount of balance. In this scenario, his account does have the necessary funds to complete the payment. The reason why the bank returns the check is that these funds are not accessible yet. They sit in the uncleared funds bucket. Relate this with R09 for the ACH technology return code or an e-check return code.
- Solution: Ramona waits for a couple of days and then tries to deposit the check again. Ideally, she should reach out to Ian to confirm the availability of funds before attempting to deposit the check again.
C: Stop Payment
- About: After first issuing the check, Ian has asked Ivy Bank not to send the payment to Ramona’s bank account before the payment initiates. Relate this with R08 for the ACH solutions return code or an e-check return code.
- Solution: Under such circumstances, the check will be returned to Ramona with an R08 code. She should then reach out to Ian to ask for clarification as to why he canceled the payment and, if necessary, ask him to write a substitute check.
D: Closed Account
- About: This check 21 return code signifies that Ian’s Bank account with Ivy Bank is closed. Therefore it cannot process the payment. Relate this with R02 for the ACH payment solutions return code or an e-check return code.
- Solution: If Ramona receives his check back with an RD return code, she should immediately reach out to Ian to ask him for another mode of payment or a check from another active bank account.
E: Unable to Locate Account
- About: This can happen if Ian’s check does not have the right routing number or account number information. This can typically happen if Ivy Bank made a typo on the account number section while issuing the checkbook in the first place. Relate this with R03 for the ACH return code or an e-check return code.
- Solution: In this case, Ramona needs to reach out to Ian to get a new check.
F: Frozen/Blocked Account
- About: In this case, Ian’s bank account is frozen, possibly due to legal action. Relate this with R16 for the ACH technology return code or an e-check return code.
- Solution: Ramona should reach out to Ian to ask for payment through another mode or bank account.
G: Stale Dated
- About: Ramona can encounter such a return code if she tries to deposit the check after it expires. Different checks have different expiry dates. She can find the expiry date for any check under the signature section. Relate this with R51 for the ACH return code or an e-check return code.
- Solution: To get the payment processed, Ramona should reach out to Ian and ask him to draft a new check so that she can deposit it and claim the money.
H: Post Dated
- About: While drafting the check, Ian has to enter a date after which the check is valid. If Ian drafts a check with a validity date in the future, Ramona can only deposit it and get the money after the set date. If she tries to deposit the check before the set date, she will receive the check back with this return code.
- Solution: In such a case, she can either reach out to Ian to draft a new check with a new date or wait for the set date before trying to deposit again.
I: Endorsement Missing
- About: Such a check 21 return code can appear if Ramona forgot to endorse the check before depositing it. Endorsing the check usually means signing or stamping the back of the check. Relate this with R51 for the ACH return code or an e-check return code.
- Solution: To get this check processed, Ramona can easily endorse the check and redeposit it to process the payment.
J: Endorsement Irregular
- About: If Ramona did endorse the check but did not do it correctly, she will end up with a returned check with the RJ return code. On most checks, there are guidelines about where you can endorse the check. If Ramona did not correctly endorse the check in the designated space or her signature was not clear, the bank will return her check with this code. Relate this with R51 for the ACH solutions return code or an e-check return code.
- Solution: In most cases, Ramona should be able to endorse the check again and redeposit it. However, she should ideally check with the bank teller once again before trying to deposit the check. If the teller says that she cannot redeposit that check, she needs to reach out to Ian for a new check.
K: Signature(s) Missing
- About: If Ian forgets to sign the check, Ramona will receive the check back with this check 21 return code. Relate this with R10 for the ACH return code or an e-check return code.
- Solution: In this situation, Ramona needs to reach out to Ian to get his signature on the check again. (In some cases of joint accounts, multiple signatures may be required on the check. So Ramona needs to ensure that she has all the necessary signatures on the check before she tries to redeposit it).
L: Signature(s) Irregular
- About: Ramona may encounter such a code if Ian does not sign the check legibly. In such cases, the bank ensures safety to prevent fraud and returns the check instead of clearing it. Relate this with R10 for the ACH return code or an e-check return code.
- Solution: If the information from the original check is illegible, it cannot be redeposited. To get the money, Ramona needs to ask Ian for a new check.
M: Non-Cash Item
- About: Some individuals try to deposit “gift” checks or “false” checks in the bank. Therefore, banks are cautious in vetting a check. If Ian is a fraudster, he may try slipping a false check to Ramona. Relate this with R10 for the ACH return code or an e-check return code.
Some of the best ways Ramona can identify such false checks would include:
- Checking for a “This Is Not a Real Check” sign on the check (often printed on checks used for board games like Monopoly)
- Identifying that the check does not have a real bank name on it
- Looking for a proper routing number or a clear magnetic ink character recognition MICR line on the check
- Solution: Ramona needs to be extra cautious while accepting checks from people. Especially from the ones, she does not know. Fraudsters commonly use such checks.
N: Altered/Fictitious Item
- About: This is again a relatively common type of return code that you will see on checks. While accepting a check from Ian, Ramona needs to make sure that there are no corrections or ineligible writing on the check. For example, if Ian has struck out the words or the numbers of the amount or tried to rewrite it with a darker ink, the bank may refuse to accept such a check. Relate this with R10 for the ACH payment solutions return code or an e-check return code.
- Solution: Ideally, while accepting the check, Ramona needs to verify the legibility of the check. If she feels that the writing is ineligible or broken/corrected, she should immediately ask for another check. If she submits such a check, and the bank returns it, she will have no option but to get a new check from Ian.
O: Unable to Process
- About: The bank may refuse to process the check if it is not correctly presented. Mutilated or crumbled checks that compromise the legibility of information on these checks face this return code. Relate this with R10 for the ACH return code or an e-check return code.
- Solution: Ramona cannot redeposit this check since critical information from the check is missing in this case. She needs to get a fresh check from Ian.
P: Item Exceeded Dollar Limit
- About: This return code notifies Ramona if Ian has conducted multiple heavy transactions from his account on the same day when Ramona is trying to deposit the check. Although Ian’s account may have enough money, the bank may not clear Ramona’s check because Ian hit the daily transaction amount limit on his account. Relate this with R11 for the ACH solutions return code or an e-check return code.
- Solution: Checks with this return code are invalid for a redeposit. Therefore, Ramona has to reach out to Ian to get a fresh check. Also, it would be an excellent idea for Ramona to ask Ian if he is about to hit the daily limit before trying to deposit the check next time.
Q: Not Authorized
- About: If Ian is using a false check or has contradicted himself on the check by writing “no drafts” or “no debits,” Ramona will receive the check back with this return code. Relate this with R10, R23, or R29 for the ACH return code or an e-check return code.
- Solution: Ramona cannot redeposit a check with this return code again and must ask Ian for another one.
R: Branch/Account Sold
- About: Such a return code may appear if Ian’s particular bank branch is closed or sold to another financial institution. Relate this with R12 for the ACH return code or an e-check return code.
- Solution: In this case, Ramona needs to reach out to Ian who in turn needs to contact Ivy Bank and get a new routing number (and a new bank account number in case it is changed) before writing a new check again. If Ian is set to send a payment to Ramona via ACH debit or paper check regularly, he should then update these details on the upcoming transactions too.
S: Refer to Maker
- About: With this return code, the bank essentially asks Ramona to reach out to Ian to find out why the check was returned. Ian should ideally have an answer for that, but if he doesn’t, then the responsibility rests on him to reach out to Ivy Bank to figure out what’s wrong. Relate this with R10 for the ACH return code or an e-check return code.
- Solution: Such checks cannot be redeposited even if Ian or Ivy Bank agrees that the fault was at their end. Therefore, Ian has to write Ramona a new check again.
T: Stop Payment Suspect
- About: If Ramona tries to redeposit a check that has failed the set standards multiple times, she encounters this code. Relate this with R08 for the ACH technology return code or an e-check return code.
- Solution: She needs to get a fresh check from Ian to proceed.
U: Unusable Image
- About: If Ramona is trying to deposit the check via a digital image, eliminating the need for paper checks (aka check truncation), she must ensure that the check is clear and all the details are completely visible. If the image is blurry, the bank will return the check to Ramona with this return code. Relate this with R08 for the ACH return code or an e-check return code.
- Solution: Ideally, Ramona should scan the image using a scanner instead of her phone to capture an imperfect image. She cannot submit that check again but can scan the original paper check and submit it to her bank.
W: Cannot Determine Account
- About: This check 21 return code appears on the check if Ian does not write the amount clearly. The bank may also reject the check if the image submitted by Ramona does not clearly show the amount the check is made for. Relate this with R03 for the ACH return code or an e-check return code.
- Solution: If the check appears written illegibly, to begin with, Ramona cannot deposit again. However, if the check was written by Ian clearly, Ramona clicks a clearer picture and redeposit the same check again.
In some cases, the bank stamps the check with a “Do Not Redeposit” label. In such circumstances, Ramona has no choice but to reach out to Ian and ask him to process the payment through another mode or write her a new check.
You can use ACH applications if you want fast check processing at low transaction costs.
Learn more about Regulation CC, aka Availability of Funds and Collection of Checks.
Date originally published: February 3, 2022
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