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When a Social Security Enrollment Fails
The ACH network isn’t just for collecting payments or paying vendors—it’s also used for enrollment purposes. One special type of ACH entry, called an ENR (Automated Enrollment Entry), is used to electronically set up or update a recipient’s account for government benefit deposits like Social Security.
When something goes wrong with an ENR submission, you might see ACH Return Code R40.
Let’s go over what R40 – Return of ENR Entry means, why it happens, and what you should do to fix the problem.
What Does ACH Return Code R40 Mean?
ACH Return Code R40 stands for:
“Return of ENR Entry.”
Here’s NACHA’s official definition:
R40 – Return of ENR Entry: The Automated Enrollment Entry (ENR) could not be processed by the Receiving Depository Financial Institution (RDFI) for one of several possible reasons.
In simpler terms: the enrollment request you tried to submit electronically didn’t go through because the recipient’s bank couldn’t process it.
What Is an ENR Entry?
An ENR is an ACH transaction used to:
Enroll someone to receive direct deposit of government benefits (like Social Security)
Update banking information for existing benefit recipients
Allow agencies like the Social Security Administration to efficiently manage direct deposit records without needing paper forms
These entries make life easier for both recipients and agencies—but the information has to be absolutely correct for the enrollment to succeed.
Why Would an R40 Return Happen?
There are a few reasons an ENR entry might be returned with an R40:
Incorrect or incomplete information (wrong Social Security Number, name, or bank account)
The account doesn’t match the individual’s information
The account is closed or can’t accept direct deposits
The bank’s systems aren’t able to handle ENR entries
A mismatch between the type of account requested and the actual account type (e.g., trying to enroll a loan account for benefit deposits)
Authorization issues, such as missing or invalid consent to enroll
Because ENRs involve sensitive government benefits, banks are extra cautious when validating the information.
How to Handle ACH Return Code R40
Here’s how to respond if you get an R40 return:
1. Review the Enrollment Details
Double-check the ENR file you submitted. Pay close attention to:
The recipient’s name
Social Security Number (SSN)
Routing and account numbers
Account type (checking or savings)
Errors in any of these fields can cause a return.
2. Contact the Customer or Recipient
If you’re working with an individual on their enrollment, ask them to verify their banking information and Social Security Number to make sure you have the correct data.
3. Work With the Receiving Bank
In some cases, the RDFI can provide guidance on why the ENR was rejected and whether it can be corrected.
4. Deposit the Paper Check (If You Still Have It)
If the original paper check is still in your possession and valid, you can often deposit it manually through traditional banking channels.
4. Submit a Corrected Enrollment
After verifying the right information, submit a new ENR entry if appropriate—or help the customer complete the enrollment using another method, like a paper form if required.
How to Avoid R40 Errors in the Future
You can minimize the chance of R40 returns by:
Verifying information carefully before submitting ENR entries
Making sure the account is open and accepts direct deposits
Confirming the recipient’s name matches exactly what’s on file with the Social Security Administration and their bank
Using account verification services if available through your ACH provider
Training your team on proper ENR data collection and input
Accuracy matters more than speed when setting up government direct deposits.
Get ACH Processing With Durango
ACH Return Code R40—“Return of ENR Entry”—means your attempt to electronically enroll a recipient for government benefit deposits didn’t succeed because of a mismatch or problem with the account or individual’s information. It’s a reminder that careful setup is key when handling sensitive payment enrollments.
At Durango Merchant Services, we help businesses and organizations manage all kinds of ACH activity, from standard billing to specialized tasks like ENR entries. Whether you’re enrolling Social Security recipients or processing payments for government programs, we’re here to make the process smoother and more secure.
