R05 | Unauthorized debit
This code indicates the receiver has disputed the debit as unauthorized under applicable ACH authorization rules.
What This Code Means
R05 is returned when the receiver (through the RDFI) indicates the debit was not authorized. In ACH, debits generally require proper authorization from the receiver, and the RDFI may return entries when the receiver claims authorization was not provided or not valid. This return code reflects a dispute-based authorization outcome rather than a processing error like insufficient funds. It does not automatically indicate fraud was confirmed; it indicates the receiver reported the debit as unauthorized. The return places emphasis on authorization status, recordkeeping, and appropriate use of debit authority by the originator.
Where Users Usually See This Code
- Subscription or recurring debit returns
- Merchant ACH return reports indicating authorization disputes
- Payment processor notifications flagged as “unauthorized”
Why This Code Appears
- Receiver reports they did not authorize the debit entry
- Authorization terms do not match the debit amount, timing, or context
- Authorization was never obtained or is not recognized by the receiver
- Receiver requests return under unauthorized debit provisions
What Typically Happens Next
- The debit is returned with R05
- The originator receives the return through the ODFI and updates status to returned/disputed
- Additional debits to the same receiver may be subject to heightened scrutiny or further returns
What This Code Is Not
- It is not “authorization revoked” (see R07)
- It is not “customer advises unauthorized” (see R10), which is a different dispute category
- It is not a stop payment instruction (see R08)
Troubleshooting Checklist
- □ Review internal authorization records and the debit’s alignment with those terms
- □ Document the return for compliance and reconciliation
- □ Evaluate whether additional entries to the same receiver are appropriate under your policies
- □ If this is managed through a processor, follow the official dispute-handling workflow
Notes And Edge Cases
Unauthorized return categories can vary depending on the context of the debit and the receiver’s claim. Some disputes relate to the existence of authorization, while others relate to revoked authorization or mismatched terms. The same underlying customer concern may be mapped differently by different RDFIs, leading to R05 versus R10. Timing and transaction descriptors can affect receiver recognition of a debit, which can influence dispute behavior even when authorization exists.