Insufficient funds
If there are not enough available funds in your account at the time a transfer is processed, the transfer will not be completed. Recurring transfers with insufficient funds will fail and will not automatically retry unless rescheduled.ACH returns
ACH transfers may be returned by the receiving bank due to incorrect account details, closed accounts, or other banking errors. If an ACH is returned, the funds will be credited back to your account once received from the external bank. When an ACH transfer is returned, you will receive an email notification with details about the return, including the return reason and the amount. Return timelines vary depending on the receiving institution.ACH corrections from the receiving bank
Sometimes an ACH transfer completes, but the receiving bank reports corrected routing or account details for future payments. When Karat receives one of these corrections, we automatically disable the saved recipient the transfer used so it isn’t reused with outdated details. Any recurring transfer scheduled against that recipient is canceled at the same time. The sender receives an email that names the affected recipient and prompts you to add the recipient again with the current details. Other saved recipients and any recurring transfers scheduled against them are not affected, even if they point to the same receiving bank.International wire beneficiary verification
When you add a new international wire beneficiary, Karat runs a compliance verification check. If the beneficiary’s verification is still pending when you initiate a transfer, the transfer is held and appears under Processing (no action needed) in your activity table.- If the beneficiary is verified, the held transfer is automatically submitted.
- If the beneficiary is disabled (did not pass verification), the held transfer is canceled and the funds remain in your account.
- If you delete a beneficiary with pending transfers, those transfers are also canceled.