Contents
- What is Bank Account Verification and How to Implement It?
- What is Bank Account Verification?
- Bank Account Verification with Prometeo
- Why is Bank Account Verification important?
- How to validate bank accounts
- Use cases for Bank Account Verification
- Benefits of integrating Prometeo’s Bank Account Verification
- Prometeo’s success stories in Bank Account Verification
What is Bank Account Verification and How to Implement It?
Validating a bank account before any interaction allows businesses to run more secure processes, avoid financial losses, and prevent fraud. By confirming that the account details are real and belong to the rightful owner, companies can operate with greater confidence.
In this article, we’ll cover:
- What bank account verification is
- Why businesses should integrate this solution
- Use cases for bank account verification
- How to integrate bank account verification with Prometeo
What is Bank Account Verification?
It’s the process of confirming that the details of a bank account are accurate, to verify the account’s status, the owner’s information, and even the available funds.
Validating an account is especially important in digital processes, as it provides more certainty about the account you’re interacting with, helping to prevent fraud or incorrect deposits.
There are different ways to validate a bank account, the most common being:
- Microdeposits: Small payments are made to verify that the destination account is correct and the right one to transfer the due amount.
- Bank statements or documentation: When a person provides official documents to prove that their bank account exists, is active, and belongs to them.
- APIs and Open Banking: Open Banking providers connect businesses with the banking system, allowing them to access account information in real-time.
The benefits of bank account validation for businesses:
- Ensuring secure processes: Verifying that the payment destination accounts are correct or ensuring that the registered person or company is legitimate gives businesses peace of mind. They can move forward knowing their funds won’t be deposited into the wrong accounts and that registered users are not using false identities.
- Saving time and money: Confirming the legitimacy of the destination accounts reduces the risk of needing to reverse errors. Similarly, verifying the authenticity of registered customers streamlines internal processes and provides a frictionless user experience.
Bank Account Verification with Prometeo
At Prometeo, a fintech specializing in developing API-based technology solutions, we’ve created a service that allows businesses to verify that a bank account is correct and real before any interaction.
By connecting with both banking and non-banking institutions, Prometeo’s API provides businesses with verified information about individuals or companies they need to interact with in payment or onboarding processes.
Our API helps clients achieve safer and more efficient processes by providing access to:
- Bank account numbers
- Account operational status
- Account holder information
- The account’s currency
Why is Bank Account Verification important?
With our API, you can confirm that a customer’s, user’s, or supplier’s account details are correct and real, as the information comes directly from the banks.
Being able to validate bank accounts helps businesses reduce the percentage of incorrect transfers to zero and prevent potential fraudulent registrations, improving and streamlining their processes.
How to validate bank accounts
Validating accounts during a payment process with Prometeo:
The validation process may vary depending on the company’s specific workflow, but it typically looks like this:
1. The company has a list of bank accounts that need validation.
2. The API performs the validation.
3. The API returns a response indicating which accounts have been successfully validated.
Validating accounts during a registration or onboarding process:
During the registration process, the user or company enters their information.
Prometeo’s API validates the submitted information.
If the details are correct, the registration is completed.
If the information doesn’t match, due to fraud or a manual error, the registration cannot proceed
Use cases for Bank Account Verification
Payment processes:
For example, when a company makes mass transfers, some may be rejected because the account or account holder information doesn’t match what’s on file. This results in wasted time and money. Bank account verification ensures that the destination account is correct and active, identifying errors or inconsistencies before any transaction is made.
Onboarding or KYC processes:
Some companies design customer or supplier registration processes where they request bank account information to facilitate future payments. Manual errors or fraud attempts can occur, rendering the registered information useless when the company needs it. With account verification, as soon as the user registers and enters their bank details, it’s possible to confirm that the information is correct, making the process safer for both the registered user and the company.
Benefits of integrating Prometeo’s Bank Account Verification
Prometeo enables businesses to connect with over 900 financial institutions across Latin America and the United States, enhancing the security of their processes:
- Avoid failed transfers due to incorrect account details
- Reduce the risk of fraud from fake accounts during registration processes
- Validate both domestic and international accounts, increasing the security of cross-border payments
Prometeo’s success stories in Bank Account Verification
With our solution, various companies and banks have made their internal processes more secure or optimized their clients’ workflows. For example, Handy managed to eliminate over 90% of incorrect payments just days after integration.
Similarly, companies like iPiD have used this solution to expand their services and reach new territories.
At Prometeo, we currently connect to over 900 financial institutions across Latin America and the United States, helping businesses make their processes more efficient and secure. If you want to learn more about Bank Account Verification and how it can benefit your company, contact us to schedule a demo.
