As Open Banking Expands, Socure Offers a Tool to Verify Account Status And Ownership

Socure Inc., a provider of digital-identity verification and fraud detection, has become the latest company to join the expanding universe of open-banking technology providers. On Tuesday, Socure announced the launch of Socure Account Intelligence, an application that verifies domestic bank-account status and ownership of the account into which funds are to be deposited in real time prior to ACH payment transactions or funds disbursement.

To verify an account, users of the app need the name of the consumer or business receiving the funds, as well as the account and routing numbers of the bank account into which the funds will be deposited. Verifying account ownership prior to the transaction is meant to ensure that funds are credited to the correct account and prevents funds from being fraudulently debited from a victim’s account, experts say. Transactions for which the app can be used include bank-account funding, disbursement of government benefits, bill payments, insurance payouts, and merchant and peer-to-peer payments.

Requiring only the accountholder’s name and account and routing information to verify an account is a key point of differentiation for the app compared to credentialing solutions, which require consumer disclosure of sensitive account login credentials, the company says.

In addition, the app is compliant with Nacha’s WEB debit rule, which requires originators of WEB debit transactions to validate an account is open and accepts ACH entries prior to payment execution.

“With identity fraud running rampant across commercial industries and the public sector, organizations can no longer make assumptions about whether the person or entity on the other end of a payment is who they say they are,” Socure chief executive and founder Johnny Ayers says in a prepared statement.

Because Socure’s identity-verification and fraud-prevention technology performs account verification during the account-onboarding process, moving into the payment-risk space is a natural extension of Socure’s business, according to Ayers.

“Now our customers can achieve full confidence in the onboarding process, from identity verification through account funding, all in a single … platform,” he says.