Account opening validation is a process that checks whether a consumer’s bank account is open and valid. It’s required when businesses use ACH (automated clearing house) to debit consumers’ accounts for payments such as recurring ACH merchant payments, bill pay and even loans like mortgages or auto-loans. click here for IP Quality Score

Unlike physical banking, where customers bring their identity documents to brick-and-mortar institutions, online account opening is conducted remotely on consumers’ devices. To reduce fraud risks, regulatory compliance and customer friction, digital account opening requires that businesses verify their customers’ identities. But the traditional methods of obtaining verification information, such as microdeposits and manual validation, can require days to complete and introduce delays for consumers, leading them to abandon the application process before they fund their new accounts.

Seamless Onboarding: The Art of Account Opening Validation for a Secure User Journey

Today, there are new technologies that can help regulated enterprises deliver secure, compliant and frictionless experiences to their customers during digital account opening. These solutions offer fast, automated and accurate ID verification that can validate the legitimacy of a financial account within seconds. These tools can reduce the risk of fraud and ensure that the account is able to receive and process a future ACH payment.

The most successful account opening validation solutions utilize a combination of passive and active identification methods to detect emerging fraud techniques that can bypass established security standards. They provide a range of detection capabilities including bot mitigation, advanced device fingerprinting and behavioral biometrics. They also integrate seamlessly with Detection and Response services to minimize false negatives that can occur as a result of new, evolving and evasive fraud techniques.