Why international business payments get rejected or returned

The short answer

The common reasons are details that don't match: a payee name that differs from the account holder, an IBAN or account number that's wrong or belongs to a closed account, or information a bank or regulator needs and didn't get. Others are stopped by sanctions or compliance screening. A return costs fees, time and sometimes an exchange rate loss, so checking before you send is cheaper than fixing a return.

Rejected, returned or recalled

The European Payments Council's SEPA rulebook separates three cases:

• Reject: the payment is refused before it settles between the banks.
• Return: the payee's bank sends the money back after settlement, for example because the account is closed or the account number is wrong. For SEPA credit transfers it must do this within three banking business days of settlement.
• Recall: your bank asks for the money back. For a duplicate or a technical error, it must ask within 10 banking business days; for fraud, within 13 months. The payee's bank has 15 banking business days to answer. A request for any other reason can be made within 13 months, and the money comes back only if the payee consents.

The common causes

The name doesn't match the account. In the euro area, banks have had to offer Verification of Payee on standard and instant euro transfers since 9 October 2025, free to the payer, according to the ECB. Banks in other EU countries follow on 9 July 2027. The payer sees whether the name is a match, a close match or no match before sending. In the UK, Confirmation of Payee has run since 2020; Pay.UK says over 300 organizations use it and it performs more than 2 million checks a day. Where there's no payee check, a mismatch shows up later: Swift lists incomplete or incorrect payment data among the reasons receiving banks hold payments. See named vs pooled virtual IBANs.

An invalid IBAN, account or routing number. An IBAN starts with a country code and two check digits, and Swift's IBAN registry lists formats for 89 country codes. In the US, routing numbers have nine digits, and the Federal Reserve's routing directory lists FedACH and Fedwire participants separately. ACH return codes include R03 (no account on file) and R04 (invalid account number).

A closed account. The SEPA rulebook gives "wrong account number or account closed" as reasons a payment can't be credited. The ACH code is R02.

Sanctions and compliance screening. OFAC distinguishes blocking from rejecting. Blocked property is frozen and can't be transferred or withdrawn. A rejected payment goes back, and US persons must report it within 10 business days. From 17 March 2028, Nacha adds a return code, R90, for ACH entries returned because of the receiving bank's sanctions obligations. Short of either, Swift lists manual checks among the causes of delay at the receiving bank.

Missing purpose codes or payment information. Swift says banks may need to verify or report details such as the purpose of a payment before crediting it. Wise says inward payments to India need a purpose code set by the Reserve Bank of India. For Canada, J.P. Morgan says it will reject wire payments with incomplete remitter or beneficiary information. It also warns that payments that don't meet updated address standards may be rejected or delayed.

A currency the account can't take. If you send a currency the payee's account doesn't hold, the receiving bank may convert it at its own rate. Bank of America, for example, converts incoming foreign currency wires to dollars at a rate "determined solely by us." Ask the payee which currencies their account accepts.

Cut-offs and holidays. These delay payments rather than return them. See how to track a SWIFT payment.

How long returns take and what they cost

On SEPA, a return reaches you within days, because the payee's bank has three banking business days. On ACH, Nacha gives payments to business accounts a two-day return window, while consumer debits carry an extended 60-day right of return. On SWIFT, Swift's tracker shows rejections, so ask your bank for the status using the UETR.

What you can lose:

• Fees on the way out. Your sending fee, plus any intermediary deductions, which Wise estimates at 15 to 50 USD per payment.
• Return and repair fees. HSBC Bank plc's February 2025 price list charges business customers £4 when a SEPA transfer they sent is returned, £20 to repair a payment with missing or wrong details, and £25 for a payment inquiry. Bank of America's November 2024 schedule bills recalls and returns made on a customer's behalf at its outgoing wire fee, $45 for an international USD wire.
• The exchange rate. A converted payment is converted again on the way back, at the bank's rate on that day.

Checklist before you send

1. Get payment details in writing from a known contact. Confirm any change of bank details by phone, on a number you already have.
2. Use the exact legal name of the account holder, and read the payee check result where there is one.
3. Check the account number. Validate the IBAN, and for US payments use the routing number for the rail you're sending on.
4. Pay in a currency the account holds.
5. Add what the receiving country needs: a purpose code, the invoice number, and a structured address with town and country.
6. Set the charge code. Use OUR if the invoice must be paid in full. See OUR, SHA and BEN.
7. Send a small test to a new payee before a large payment.
8. Keep the confirmation and UETR for every SWIFT payment.

How this works with Align

Align's accounts are named: your company is shown as the account holder, in USD over ACH, wire and SWIFT, EUR over SEPA and SEPA Instant, and GBP over Faster Payments. ACH and wire access isn't switched on automatically: you request it, and Align's US banking partner runs a second review after Align's KYB and can decline or set limits. Payments to third parties such as suppliers go out from your named virtual account, and Align may ask for the invoice behind a payment. Your balance is held in USDC or USDT and converted when you pay. For countries and activities Align can't serve, see prohibited and restricted use.

Sources

• European Payments Council, SEPA Credit Transfer and 2025 SCT rulebook, version 1.1 (effective 5 October 2025)
• European Central Bank, Instant Payments Regulation (accessed October 2026)
• Pay.UK, Confirmation of Payee (accessed October 2026)
• Payment Systems Regulator, Confirmation of Payee (accessed October 2026)
• Swift, IBAN registry and How long does a Swift payment take? (accessed October 2026)
• Swift, Swift GPI (accessed October 2026)
• OFAC, Basic information FAQs (accessed October 2026)
• eCFR, 31 CFR 501.604, reports on rejected transactions (accessed October 2026)
• Nacha, New return reason code for sanctions compliance obligations and RMAG Originator Essentials (accessed October 2026)
• Federal Reserve Financial Services, E-Payments Routing Directory (accessed October 2026)
• Increase, ACH returns (accessed October 2026)
• J.P. Morgan, ISO 20022 migration: client resources (accessed October 2026)
• Wise, Purpose codes for inward remittance to India (April 2025) and What are Swift correspondent fees? (accessed October 2026)
• HSBC Bank plc, Business price list (February 2025)
• Bank of America, Business schedule of fees (effective 15 November 2024)