Bank account verification helps in creating new accounts and setting up recurring payouts. It also helps the customers to link their personal details for better financial management and setup of the account according to their needs. Nowadays, instant bank account verification has become necessary to keep up with the ever-evolving business world. With the world around us becoming faster, instant bank account verification (emphasizing the word “instant”) has helped the business complete payouts without failures. Here are few reasons discussed below:
Validating Bank account
Instant Account Verification (IAV) has surpassed the ability of microdeposits in terms of being an outdated and expensive process. It has helped in validating multiple bank accounts at once and instantly. Anything that decreases the amount of time taken is best suited for a business and thus, it helps out the business to complete payouts within the stipulated time frame. Moreover, it also helps in authenticating the account holder and the money which secures the payouts. It further assists in verifying the customer or the account holder whether the entity is legitimate or not. This allows the bank to verify where the money is being transferred and by who to whom. This method helps in figuring out if the account has been used for personal benefits or business purposes.
Easy money Transfer
With instant bank account verification, transferring funds has become easier. The account holder details are easily verified and available which helps in accessing the payouts during transactions. Money transfer has become smooth and seamless. With verified accounts, it is more likely that accounts can be accessed with more payment gateway merchants from different websites.
Reducing Fraud
Fraud has been a real issue for the banking sector from the beginning. Bank account verifications’ actual target has always been to prevent and reduce fraudulent transactions. By verifying the bank accounts, the chances of potential frauds get reduced. It helps in authenticating the account holder and the money transferred through it.
Enhanced speed and accuracy
The word “instant” in IAV already suggests the speed and the data collected through the verification proves the accuracy. It uses Open Authentication (OAuth) connections which helps in verifying the payment account without providing any additional details to the third party. This API connection also benefits in speed (5 seconds roughly to verify the details from the account) and reliability (OAuth connections allow cooperation from multiple parties which provides far more reliability than other methods of verification). Bottom line is that it helps in reducing the onboard time with more efficient speed and accuracy.
Improved security
The OAuth connection used in bank account verification provides an extra layer of security. When the payout asks for the credentials and other details of the account, this API connection provides data to pass without sharing any confidential data and prevents any leakage of personal information. Additional security also offers the highest bank-level privacy and regulatory standards.
Furthermore, bank account verification also helps with:
- Consumer payments
- Deliver on NACHA compliance
- Avoiding NSF and Overdraft charges
With the verification of bank accounts, the financial institution can keep track of real-time updates which allows it to get alerts on NSF and overdrafts. Thus, these two can be kept in check to avoid extra fees. NACHA Rules are meant to safeguard your customers’ sensitive financial and non-financial data and ensure that all ACH transactions are handled smoothly and securely. The bank account verification, thus, helps to deliver NACHA rules with more seamless service. This also eliminates many of the errors that usually occur during the payment when the account is being verified. The information used during the payment is directly retrieved from the bank servers.
