Reduce ACH Returns with PreNotes
If your organization is struggling to manage your return rates and reduce your ACH returns or if you just want to do an advance validation of an account prior to sending an ACH Debit, a PreNote may be just the tool for you.
Coming in the spring of 2021, all organizations using ACH WEB Debit transactions will be required to validate a receiver’s account prior to originating the WEB Debit. PreNotes are one of the tools that can meet that account verification requirement. But, PreNotes are not just for organizations sending WEB Debits; they can be used by anyone to validate an account prior to sending a debit transaction.
PreNotes are zero dollar amount ACH transactions used to validate the existence of an account. When a PreNote is sent, it will post to the receiving bank using the same timing as a normal ACH transaction. Like a normal ACH transaction, the PreNote will return within 2 to 4 days, if the account is closed or invalid. PreNotes are a great way to validate an account exists and is open prior to sending a debit, so if you suspect your client may have closed their account, or it’s a new customer and you want to validate the account prior to the payment date, send a PreNote.
Getting advanced warning that a receiver’s account has been closed will give your team the ability to react before the payment becomes past due. Contacting a receiver and working out payment arrangements in advance of an ACH Return can help reduce your ACH Return Rates. PreNotes also work very well to validate new customer’s bank accounts, or any changes to the account of an existing customer. Just send a PreNote to ensure the account is open and the account information is valid. PreNotes are a great way to ensure an account is open and valid in advance of the debit date, giving you and your team peace of mind.
PreNotes are available to all ACHWorks clients, and the cost of PreNotes is significantly less than a regular transaction. You can’t loose!