RISK INTELLIGENCE – ACCOUNT VERIFICATION
Protecting ACH Payments
Discover how our solutions can help you reduce payments risk and ensure compliance with evolving Nacha rules. We’re proud to be a Nacha preferred partner.
Nacha compliance is non-negotiable
The National Automated Clearing House Association (Nacha) is the administrator of the Automated Clearing House (ACH) Network, the US payment system covering ACH direct deposits and ACH direct payments.
Nacha issues regulatory requirements related to ACH transactions, including, for example, requirements to conduct KYC due diligence on all customers; obtain clear authorisation from the true account holder to debit or credit their account; verify that the bank account exists and has a positive status; and verify the true identity of the party with whom you are transacting.
March 2022 also saw the introduction of a new WEB Debit Account Validation rule, requiring merchants to adopt commercially reasonable methods of fraud detection, including account validation.
ACH volumes are growing at record rates. In 2023, 31.5 billion payments valued at $80.1 trillion were securely handled.
As ACH Network usage continues to grow, Nacha has indicated that it will be introducing a new risk management framework for ACH payments, focusing on reducing fraud and improving transaction quality. Businesses will be required to meet these enhanced standards, and for many this will necessitate changes to their risk management systems.
Nacha compliance is non-negotiable – and failure to comply can carry substantial financial penalties.
Use Case
What is Nacha compliance?
The burden of Nacha compliance rests with merchants, who must comply with evolving Nacha rules and seek to avoid commonly reported violations, such as those relating to unauthorised entries, entries initiated to invalid account numbers and already closed accounts.
In order to remain Nacha compliant, prevent fraud and lower costs, it is essential to proactively authenticate bank accounts and owners throughout the customer lifecycle, which includes:
Onboarding: merchants must verify the account owner and the status of a bank account before accepting the account as a payment method.
Change management: merchants must validate the account status and account owner prior to an ACH pull for a consumer or business payment.
Pushing of disbursements or pulling of payments: it is essential to ensure that customer funds are being sent to an account that is open, valid and owned by the customer with whom you are dealing.
Our solutions
Explore how our solutions can help
Compliance with Nacha rules is not always straightforward, especially considering that many traditional verification methods, such as password-based authentication, can cause friction and contribute to a poor customer experience. Nevertheless, compliance is essential. Our fraud prevention solutions have been designed to help you comply with Nacha rules – easily and efficiently.
Our account and payment verification offering lets you verify that an ACH account exists, its type, that it is open and in good standing, and that the person or business with whom you are transacting is the true owner of the account.
Our account verification capabilities can be used together with our other, interoperable solutions, including Identity Verification, to help you meet the full range of customer due diligence (CDD) and AML requirements that are needed for ACH transactions.
Our Account Insights solution provides additional information related to transactions, such as transaction history and aggregated historical information on account activity. This extra level of detail can be instrumental in spotting potential fraud.
Leverage our suite of complementary solutions to:
Reduce fraudulent transactions
Minimise ACH returns
Identify potential account takeovers
- Reduce unauthorised transactions
Moreover, our solutions contribute to a better customer experience by streamlining onboarding processes and enabling quick decisioning, keeping the pace of business brisk.
Features & Benefits
We enable streamlined Nacha compliance
LSEG Risk Intelligence is a Nacha Preferred Partner for Compliance and Risk and Fraud with a focus on risk and fraud prevention.
Access the largest coverage of bank account data in the US via two methods of bank account verification: a consortium bank database solution and an open banking solution.
Our integrated solutions can be accessed via a single API for added simplicity, speed and efficiency. Additional delivery methods include Portal, Portal Batch and SFTP batch.
Our frictionless, real-time process ensures a positive customer experience, while delivering the peace of mind that account information has not changed during the payment transaction.
Scalable technology means that you can quickly deploy KYC and KYB capabilities and multi factor authentication services as and when needed for a complete and holistic approach to fraud management.
Recognised by Nacha as a Preferred Partner
We’re proud to be a preferred partner of Nacha, the ACH governing body, in the categories of compliance and risk and fraud prevention. Preferred partners are those with robust, innovative solutions that help advance the ACH network and support network participants.
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