An RDFI may contest or correct a dishonored Return Entry provided it is done within how many Banking Days of the Settlement Date?

An RDFI may contest or correct a dishonored Return Entry provided it is done within how many Banking Days of the Settlement Date?

• A. One Banking Day
• B. Two Banking Days
• C. Three Banking Days
• D. Five Banking Days

Answer: (B)

In the context of ACH (Automated Clearing House) transactions, a Receiving Depository Financial Institution (RDFI) has specific timeframes within which it is allowed to contest or correct a dishonored Return Entry. This timeframe is important to maintain orderly processing and ensure that all parties involved in the transaction can address any errors or issues in a timely manner. For a dishonored Return Entry, the RDFI must act within two Banking Days of the original Settlement Date. This provision allows the RDFI to resolve any discrepancies or issues that may arise from the return of a payment, ensuring that they can properly handle the transaction and communicate any necessary corrections back to the Originating Depository Financial Institution (ODFI) without undue delay. While options that outline different timeframes may appear plausible, only the two Banking Days allow for the correct management of returns in compliance with ACH rules, which are aimed at protecting both consumers and banks during the financial transaction process. This ensures a balance between efficiency and accuracy in the handling of returns within the ACH network.

In the context of ACH (Automated Clearing House) transactions, a Receiving Depository Financial Institution (RDFI) has specific timeframes within which it is allowed to contest or correct a dishonored Return Entry. This timeframe is important to maintain orderly processing and ensure that all parties involved in the transaction can address any errors or issues in a timely manner.

For a dishonored Return Entry, the RDFI must act within two Banking Days of the original Settlement Date. This provision allows the RDFI to resolve any discrepancies or issues that may arise from the return of a payment, ensuring that they can properly handle the transaction and communicate any necessary corrections back to the Originating Depository Financial Institution (ODFI) without undue delay.

While options that outline different timeframes may appear plausible, only the two Banking Days allow for the correct management of returns in compliance with ACH rules, which are aimed at protecting both consumers and banks during the financial transaction process. This ensures a balance between efficiency and accuracy in the handling of returns within the ACH network.