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Intuit
34 helpful votes

Handle a rejected or failed bank transfer payment

Learn what to do when a customer's bank transfer is rejected.

Bank transfer payments from your customers can sometimes be rejected due to incorrect information or insufficient funds. When this happens, the customer's invoice isn't paid, and your Accounts Receivable records become inaccurate. In this article, we'll show you how to handle rejected bank transfers.

Step 1: Determine if the payment deposit was recorded

 

  1. Select the Plus icon (+) on the Toolbar. Then choose Bank Deposit.
  2. Select the area labeled QuickBooks Payments.
  3. Look for the payment in the list. If it is there then it's undeposited. If not, the deposit was recorded to your bank account in QuickBooks.

Step 2: Create a special service item

A special service item will let you account for the rejected payment.

  1. Select the Gear icon on the Toolbar.
  2. Under Lists, select Products and Services.
  3. Select New, then choose Service.
  4. Enter the needed information:

    If the payment was deposited in QuickBooks

    • Name - Rejected bank transfer
    • Description - Bank transfer payment received but was rejected by the bank
    • Income account - Select the bank account where the payments were deposited to

    If the payment wasn't deposited in QuickBooks

    • Name - Rejected bank transfer
    • Description - Bank transfer payment received but was rejected by the bank
    • Income account - Undeposited funds
  5. Leave everything else blank.
  6. Select Save and close.

Step 3: Create a new invoice

You need to create a new invoice to send to your customer.

  1. Select the customer.
  2. Enter the Rejected bank transfer item you just created in the steps above. (Do not use the original product/service you used on the invoice).
  3. Enter the total amount of the invoice including tax if applicable. (Do not mark as taxable).
  4. Select Save and close.

Step 4: Attach the rejected payment to the new invoice

Track the rejected payment with the new invoice.

  1. Open the original invoice for the customer.
  2. Select the Payment link to open the rejected payment.
  3. Uncheck the original invoice. Then check the new one.
  4. Select Save and close.

Now your account balance is all set and you can resend the original invoice to collect the payment.

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