PCE enforces Nacha’s return‐rate rules by automatically blocking external bank accounts that exceed defined thresholds. This protects your ACH origination health, prevents repeated failures, and ensures compliance with network quality standards.

Prerequisites

ACH origination must be enabled on your PCE merchant account
External Accounts must be created and verified in PCE

Limitations

Blocking only applies to debits against specific external accounts, not entire customer profiles

Compliance / Regulation Mandates

Nacha Operating Rules

Return‐rate thresholds for administrative, unauthorized, and overall returns must be respected.

ODFI Obligations

Our partner bank (ODFI) must monitor and enforce blocking rules on return rates.

Risk Management

Blocking prevents repeated failures that can lead to fines or suspension of origination privileges.

Monitoring and Automated Debit Blocks

PCE continuously calculates the return rate for each external account over a 60‐day rolling window. When predefined Nacha thresholds are exceeded, the system automatically blocks further debit attempts against that account to protect network quality and your origination privileges.

Differentiated Handling of Return Types

Administrative Returns (R02, R03, R04)
- Indicate definitively incorrect account information (e.g., closed, invalid).
- Block after a single return, preventing guaranteed failures.
Unauthorized Returns (R05, R07, R10, R11, R29)
- May reflect fraud or customer confusion.
- Allow up to three consecutive returns before blocking, giving merchants time to remediate with customers.

Mitigating ACH Returns

Before blocking occurs, consider:

Use Instant EWS or Prenote verification to validate account details.
Secure and retain proper customer authorizations for debit amounts.
Monitor returns closely; upon an administrative or unauthorized return, temporarily block the account for investigation and either resolve or close within five business days.

Nacha Return Rate Thresholds and System Actions

Return Type	Applicable Return Codes	Nacha Threshold	System Action on External Account
Unauthorized Returns	R05, R07, R10, R11, R29	0.5% of debits in preceding 60 days	Blocked after 3 consecutive returns of this type
Administrative Returns	R02, R03, R04	3.0% of debits in preceding 60 days	Blocked after a single return of this type
Overall Returns	All Return Codes	15.0% of debits in preceding 60 days	Monitored at the program level; persistent violation risks origination

When an external account is blocked, no new ACH debits can be originated against it. This automated control is critical to preventing repeated failures, maintaining compliance with Nacha rules, and preserving your ACH origination privileges.