diff --git a/src/hooks/useApproveOnlyRoleBlockedModal.ts b/src/hooks/useApproveOnlyRoleBlockedModal.ts
index 37f1e61cb985..5f14c88a0951 100644
--- a/src/hooks/useApproveOnlyRoleBlockedModal.ts
+++ b/src/hooks/useApproveOnlyRoleBlockedModal.ts
@@ -2,7 +2,7 @@
  * Subscribes to BLOCKED_ROLE_CHANGE in Onyx and shows the blocked-reasons modal on the global modal stack
  * when the backend refuses an approve-only role change.
  */
-import {clearBlockedRoleChange, clearUpdateMemberRoleError} from '@userActions/Policy/Member';
+import {clearBlockedRoleChange} from '@userActions/Policy/Member';
 
 import CONST from '@src/CONST';
 import type {TranslationPaths} from '@src/languages/types';
@@ -47,17 +47,7 @@ function useApproveOnlyRoleBlockedModal() {
         lastShownRef.current = blockedRoleChange;
         isModalOpenRef.current = true;
 
-        const {policyID, email, blockedReasons = []} = blockedRoleChange;
-
-        // `OnyxUpdates.apply` runs `request.failureData` on the microtask after `response.onyxData`, which sets a
-        // generic inline error on the member row. Clear that row error once `failureData` has settled so the modal
-        // is the only feedback shown for a blocked role change.
-        if (policyID && email) {
-            Promise.resolve().then(() => {
-                clearUpdateMemberRoleError(policyID, email);
-            });
-        }
-
+        const {blockedReasons = []} = blockedRoleChange;
         const reasonLines = blockedReasons.filter((reason) => reason in REASON_TRANSLATION_KEYS).map((reason) => `• ${translate(REASON_TRANSLATION_KEYS[reason])}`);
         const hasReasonLines = reasonLines.length > 0;
 
diff --git a/src/libs/actions/Policy/Member.ts b/src/libs/actions/Policy/Member.ts
index 384ee06abfc8..3a6dd2832a59 100644
--- a/src/libs/actions/Policy/Member.ts
+++ b/src/libs/actions/Policy/Member.ts
@@ -648,6 +648,8 @@ function buildUpdateWorkspaceMembersRoleOnyxData(policy: OnyxEntry<Policy>, sele
         },
     ];
 
+    // Roles that cannot create expenses show a dedicated modal on refusal, so skip inline row errors.
+    const canCreateExpenses = canRoleCreateExpenses(newRole);
     const failureData: Array<OnyxUpdate<typeof ONYXKEYS.COLLECTION.POLICY | typeof ONYXKEYS.COLLECTION.REPORT>> = [
         {
             onyxMethod: Onyx.METHOD.MERGE,
@@ -658,8 +660,8 @@ function buildUpdateWorkspaceMembersRoleOnyxData(policy: OnyxEntry<Policy>, sele
                         // eslint-disable-next-line no-param-reassign
                         member[current.email] = {
                             ...(previousEmployeeList[current.email] ?? {}),
-                            pendingAction: CONST.RED_BRICK_ROAD_PENDING_ACTION.UPDATE,
-                            errors: ErrorUtils.getMicroSecondOnyxErrorWithTranslationKey('workspace.editor.genericFailureMessage'),
+                            pendingAction: canCreateExpenses ? CONST.RED_BRICK_ROAD_PENDING_ACTION.UPDATE : null,
+                            ...(canCreateExpenses && {errors: ErrorUtils.getMicroSecondOnyxErrorWithTranslationKey('workspace.editor.genericFailureMessage')}),
                         };
                         return member;
                     }, {}),
diff --git a/tests/actions/PolicyMemberTest.ts b/tests/actions/PolicyMemberTest.ts
index 332f9f26b14e..85dbcb778ddc 100644
--- a/tests/actions/PolicyMemberTest.ts
+++ b/tests/actions/PolicyMemberTest.ts
@@ -213,6 +213,64 @@ describe('actions/PolicyMember', () => {
                 });
             });
         });
+
+        it('does not set errors in failureData when changing role to approve-only', () => {
+            const member1 = 'member1@test.com';
+            const member2 = 'member2@test.com';
+            const fakePolicy: PolicyType = {
+                ...createRandomPolicy(0, CONST.POLICY.TYPE.CORPORATE),
+                employeeList: {
+                    [member1]: {
+                        email: member1,
+                        role: CONST.POLICY.ROLE.USER,
+                    },
+                    [member2]: {
+                        email: member2,
+                        role: CONST.POLICY.ROLE.USER,
+                    },
+                },
+            };
+
+            const approveOnlyData = Member.buildUpdateWorkspaceMembersRoleOnyxData(fakePolicy, [member1, member2], [1, 2], CONST.POLICY.ROLE.APPROVE_ONLY);
+            expect(approveOnlyData.failureData).toEqual(
+                expect.arrayContaining([
+                    expect.objectContaining({
+                        key: `${ONYXKEYS.COLLECTION.POLICY}${fakePolicy.id}`,
+                        value: expect.objectContaining({
+                            employeeList: {
+                                [member1]: {
+                                    email: member1,
+                                    role: CONST.POLICY.ROLE.USER,
+                                    pendingAction: null,
+                                },
+                                [member2]: {
+                                    email: member2,
+                                    role: CONST.POLICY.ROLE.USER,
+                                    pendingAction: null,
+                                },
+                            },
+                        }),
+                    }),
+                ]),
+            );
+
+            const adminData = Member.buildUpdateWorkspaceMembersRoleOnyxData(fakePolicy, [member1], [1], CONST.POLICY.ROLE.ADMIN);
+            expect(adminData.failureData).toEqual(
+                expect.arrayContaining([
+                    expect.objectContaining({
+                        key: `${ONYXKEYS.COLLECTION.POLICY}${fakePolicy.id}`,
+                        value: expect.objectContaining({
+                            employeeList: expect.objectContaining({
+                                [member1]: expect.objectContaining({
+                                    pendingAction: CONST.RED_BRICK_ROAD_PENDING_ACTION.UPDATE,
+                                    errors: TestHelper.anyObject,
+                                }),
+                            }),
+                        }),
+                    }),
+                ]),
+            );
+        });
     });
     describe('requestWorkspaceOwnerChange', () => {
         it('Change the workspace`s owner', async () => {