The feeling of having your own business can’t match anything. It is one of the boldest steps somebody could ever take. But to take your business to new heights, you need a decent payment gateway.
All businesses are required to collect and send money to conduct business smoothly. To do so, they need customers’ bank account information, but the transaction can often lead to fraudulent activities or sometimes forget to insert correct details. This is where bank account verification comes as a rescue.
This can happen to any business, and that’s why here in this blog, we will learn all about the importance of bank account verification.
What is Meant by Bank Account Verification?
As the name speaks volumes on its behalf, it is the process that verifies the details of customers and other things. We are human, and we are supposed to make mistakes. Suppose your customers have entered the wrong account number, then bank account verification comes as a rescue. It will save all troubles. The ACH transaction procedure requires bank account verification to confirm that monies are arriving from or moving to legitimate savings accounts. This ensures that the accounts being associated are a legitimate bank, often known as fund source validation.
Since more organizations accept digital ACH payments as a substitute for credit cards and physical checks, having a trustworthy bank account verification technique promotes a positive user experience.
Importance of Bank Account Verification
Let’s understand in brief the importance of bank account verification for many businesses. Further, to gain knowledge on the same, please visit https://www.cashfree.com/bank-account-verification this site.
1. Prevent Fraudulent Activities
No business wants fraudulent activities, and for achieving the same, it is essential to have a bank account verification. To understand it better, let’s say you have a digital store where you sell shoes, and one of the customers added incorrect details on purpose, like the address on the bank account number not matching the shipping address. This is a common type of fraudulent activity that businesses come across more often.
Many organizations are implementing two-factor authentication, where customers have to provide a pin or OTP number and all. Bank account verification put a full stop to money laundering and fraudulent activities.
2. Prevent Costly Chargebacks
You might be aware that chargebacks are a massive pain for business owners. And most chargebacks are due to the use of credit cards. Credit card fraudulent activities are prevalent. As most purchases moved into the “card-not-present” group when companies started allowing people to be using credit cards for online purchases, it became significantly easier to perpetrate fraud. However, companies suffer the most as they have to pay back the original card owner resulting in costly chargebacks.
However, this will not be an issue if you have a bank account verification procedure since it helps identify the legitimate account.
3. No More Fines
Do you know that if the business goes through fraudulent and money laundering activities, they need to pay a fine? One such example is Standard Chartered; they were fined by US and UK authorities for around $1.1 billion. But you can save all this if you implement bank account verification in your business. Businesses that employ streamlined, effective verification software and methods comply with AML and KYC standards, allowing them to prevent unwanted fines.
Some numerous other laws and regulations apply to companies based on their location and the people they serve.
That’s all! Here is all the vital information about bank account verification and how it can take a business to new heights.