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Orum, a provider of technology for payment processing and account verification, announced Tuesday the launch of Verify, an account-verification solution for FedNow, the Federal Reserve’s instant-payment service, which launched in July.
With Verify, businesses initiating a payment through FedNow can validate, within 15 seconds prior to sending funds, whether a recipient’s account is open and valid. Verify says it can validate 100% of consumer and business bank accounts in the United States. The solution, however, does not verify funds in the sender’s account, the company says.
Orum says it developed Verify as a way to provide real-time account validation and eliminate the need for customers to be involved in the account-verification process. Historically businesses have used a range of techniques to validate a recipient’s account, including sending microdeposits, batching historical data that fails to reflect intra-day changes, and manual entry of end-user login credentials, Orum says. Those processes often took days to complete, the company adds, which slows the movement of money between accounts.
“Failed payments cost the global economy over $100 billion each year. Lost time verifying accounts equals lost revenue and ultimately lost customers. This is especially true for business bank accounts, which are notoriously difficult to verify,” Orum chief executive and founder Stephany Kirkpatrick says in a statement. “Businesses need confidence they are debiting or crediting a real account to ensure the payment lands safely in the bank account, but most solutions today are slow or don’t include coverage for all [business-to-business] use cases.”
In addition to FedNow, Orum provides application programming interfaces to validate accounts for transactions initiated over The Clearing House Payments Co. LLC’s RTP network, as well for same-day ACH transactions and for wire transfers.
