Account Verification Systems confirm that a bank account is open and in good standing prior to the account being loaded into the billing engine. This means that data entry errors, potentially closed accounts, or even fraud can be caught before the sale’s confirmation. Verification automation also completes the 2021 NACHA requirement for Bank Account Validation.
Take for instance a homeowner that knows how the game the energy companies, a free month of electricity could be provided before the energy company realizes that the associated account was not valid. A small transaction fee could have prevented the electric company from a 5-figure loss.
Businesses often employ third parties in order to generate new clients, with the third party entities being paid when new clients are onboarded. Friction, financial loss, and potential loss of the new customer can occur if a new customer’s payment declines due to poor checking account data. By employing an Account Verification System businesses can eliminate much of the “after the sale” work needed once a payment fails.
Employing an Account Verification System can be the difference between losing or saving a sale. Bear in mind that the majority of payment rejections are accidental. Forcing a customer to redo the sale process because of a verification errors will inevitably lead to a loss of sales. Businesses MUST employ an Account Verification System to ensure that customers aren’t lost due to such errors.
Businesses that rely on future billing are especially vulnerable to bad check data, but using an Account Verification Service can dramatically reduce bad check acceptance and the workflow problems they create.
While authorization is a important aspect of the credit card sphere, the ACH realm lacks such an authorization component. When it comes to credit cards, a merchant knows they are getting paid at the point of sale because they can verify that the customer has the requisite funds on their cards at the time of payment. This reserves those funds for capture and settlement.
Learn more about Checking Account Validation for the 2021 NACHA WEB originated transaction requirement.