A Notification of Change in the ACH network is an electronic message the receiving bank sends back to the originator after posting a payment that contained outdated or incorrect details. The money arrived. The bank routed it to the right account despite the flaw, and the notice tells you exactly which field to fix before you send another entry. Under Nacha rules you generally have six banking days, or the time until your next entry to that account, to apply the correction.
NOC Versus ACH Return
These get confused constantly, and the difference matters. An NOC means the funds posted. The receiving bank absorbed the error, delivered the payment, and is telling you how to correct your records for next time. An ACH return means the transaction failed and the funds went back to you. Returns happen for reasons like a closed account, a deceased account holder, insufficient funds, or an unauthorized entry.
The receiving bank’s willingness to fix your data on the fly is not unlimited. When entries keep arriving with the same wrong information after an NOC has been issued, the bank can start returning them. Treating an NOC as low-priority housekeeping is a mistake. Each one is a warning that the next payment might not land.
ACH Change Codes and What Each One Means
Every NOC carries a standardized change code identifying the field that needs correction, plus a corrected data field with the exact replacement information the receiving bank expects you to use. You don’t have to call anyone or guess. The fix is embedded in the notice.
- C01 — Incorrect account number.
- C02 — Incorrect routing number. The transit routing number has changed or was entered wrong.
- C03 — Incorrect routing number and account number. Both need updating, often because a routing change also altered the account number structure.
- C04 — Incorrect name. The account holder’s name has changed or was submitted incorrectly.
- C05 — Incorrect account type. A payment coded for checking posted to savings, or the reverse.
- C06 — Incorrect account number and account type.
- C07 — Incorrect routing number, account number, and account type. All three fields need correction.
- C09 — Incorrect individual ID number.
- C10 — Incorrect company name.
- C11 — Incorrect company ID.
- C12 — Incorrect company name and company ID.
- C13 — Addenda format error. The supplemental data attached to the entry has a formatting problem.
How Long You Have to Update Your Records
Under Nacha Operating Rules (Subsection 2.12.1), an originator must apply the corrected information within six banking days of receiving the NOC, or before the next entry to that account, whichever is later.1Nacha. Minor Rules Topics The “whichever is later” language matters in practice. If your next payroll run to that employee happens on day three, you still have until day six on paper, though fixing it before the next run is the safer play.
One boundary to note: for single or one-time entries, the originator has discretion on whether to act on the NOC at all. If you sent a one-off vendor payment, you’re not obligated to update anything because there won’t be a subsequent entry to that recipient. This discretion applies regardless of payment format.1Nacha. Minor Rules Topics
Applying the Correction
The fix itself is straightforward. Pull up the recipient profile in your payroll or accounts payable system that matches the NOC. Replace the flagged fields with the corrected data from the notification. If the change code is C03, that’s two fields (routing and account number). If it’s C05, it’s a single account-type flag.
Save the change and confirm your system logged it. Most payroll and accounting platforms create an audit trail automatically, but verify it exists. That log matters if your bank or Nacha ever asks whether you acted on the NOC within the required window. Once the corrected data flows into your next batch file, that recipient should stop generating NOCs.
If the same recipient keeps triggering NOCs after correction, something is wrong on your end. Confirm you updated the right profile rather than a duplicate. Check whether a batch import or software update reverted the change. Repeat NOCs for the same account after a correction almost always point to a data management issue, not a banking one.
What Happens If You Ignore an NOC
The immediate consequence usually isn’t a Nacha fine. It’s that your payments start bouncing. A receiving bank that has already told you the correct information has little reason to keep re-routing your errors, and the transactions will come back as returns. That means employees paid late, vendors not paid at all, and pressure from your own originating bank, which may charge fees for excessive returns or NOCs and, in serious cases, revoke your ability to originate ACH entries.
On the enforcement side, Nacha uses a tiered violation system administered by its ACH Rules Enforcement Panel. For the most serious category — Class 3, involving willful or egregious conduct — sanctions can reach up to $500,000 per occurrence, along with a directive to the originating bank to suspend the offending party.2Nacha. Nacha Operating Rules – Reversals and Enforcement The actual penalty in any given case depends on the violation level, how egregious the conduct was, and how the originating bank responded.3Nacha. How Nacha Enforces its Rules
If You Are the Account Holder, Not the Sender
NOCs work in your favor when you’re receiving payments. The bank is making sure the money reaches you even when the sender’s records are stale, and the notice travels between the two financial institutions and the originator — not to you. You typically won’t see it.
Where things can go wrong is when a sender updates your details based on an NOC and the new information is off. If a paycheck or recurring deposit starts hitting the wrong account after such an update, call your bank right away. The bank originated the NOC and can verify what corrected data it sent. Contact the sender’s payroll or accounts payable team as well to confirm the change they applied matches what the bank intended.