CyberGrants Disbursement Solutions (CGDS) receives feedback from our banking partners when the intended party does not promptly accept electronic ACH payments. Feedback falls into two categories: ACH Returns or Notification of Change (NOC). This article outlines what these scenarios mean and the CGDS process.
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ACH Returns
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ACH Notification of Change (NOC)
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What does this mean?
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The bank has rejected the deposit for various reasons. This may include the account number being invalid, the account not accepting deposits, or the account being closed.
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The account number on file has been replaced and is no longer valid.
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What happens to the deposit?
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The payment remains in the CGDS bank account until it’s reissued.
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The payment is deposited into the new bank account. Please note that it may take longer than expected to receive the payment.
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What does CGDS do when this happens?
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CGDS automatically:
- Deactivates the original payee.
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Voids the initial payment and immediately reissues a new paper check.
- Sends an email to the payee about the bank’s rejection and the newly issued payment.
Note: Payees will be requested to provide updated account information for future ACH payments.
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CGDS automatically:
- Deactivates the original payee.
- Sends an email to the payee informing them of the delay caused by outdated account information.
Note: Payees will be requested to provide updated account information for future ACH payments.
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What happens to future ACH payments?
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The organization can receive ACH payments as soon as they provide valid bank account information. While no good information is on file, paper checks will continue to be issued.
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How long does processing ACH returns and NOC take?
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In most cases, it will take five to ten business days to process a payment. However, the length of time to receive a deposit varies between banks.
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How can I prevent the delays and unexpected expenses of ACH returns and NOCs?
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Activate FrontDoor in your CGDS programs and encourage or require organizations to sign up. FrontDoor offers real-time ACH routing and account information scanning to confirm that the account can accept deposits and that the bank account belongs to the organization.
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