If an individual payment within an electronic payment file is rejected by the receiving bank, you'll need to reverse the payment then process the reversal through the Prepare Electronic Payments window.

Here's what to do:

1. Go to Banking > Transaction Journal > Disbursements tab.
2. Open the rejected payment.

3. Go to the Edit menu and choose Reverse Payment.

   Can't see "Reverse Payment"?

   Open the preferences (Setup > Preferences > Security tab) and select the preference Transactions CAN'T be Changed; They Must be Reversed.

4. Check the transaction details then click Record. The reversal is now available in the Prepare Electronic Payments window as a negative amount.
5. Process the reversed payment through the Prepare Electronic Payments window as described in Electronic payments. This will balance your electronic clearing account. You won't need to create or process a bank file for this transaction.
6. Enter the replacement payment using the same method used for the original payment. If paying electronically, make sure you first address why the original payment was rejected.

When reconciling your bank account

As the reversal transaction is posted as a deposit to your cheque account, it will correspond with the rejected payment on the bank statement. The replacement payment, being a withdrawal, will also correspond with the bank statement, so simply mark off these transactions as Cleared as they appear on your bank statement.