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Open Banking, Partnership Announcements

SWBC Selects Finicity Pay™ for Account Validation as Nacha Issues New Regulations

One thing we’ve learned this past year – if we didn’t already know – is how we pay, get paid, or otherwise move money, is changing. One almost wonders what the fate of paper money will be in the future. Until that is sorted out, we’ll continue exploring ways to improve the money movement process. That’s where open banking comes in. Through open banking we’re able to introduce new tools that secure and simplify the money experience. One area enhanced by open banking is Automated Clearing House (ACH) payments. 

To that end, we’re very excited that industry innovator SWBC has chosen Finicity Pay™ for instant account verification of online Automated Clearing House (ACH) payments. This partnership simplifies the payment process while also satisfying Nacha’s new web debit rule, planned to take effect March 2021.

NACHA’s New Rules

Currently, ACH Originators of web debit entries are required to use a “commercially reasonable fraudulent transaction detection system” to screen web debits for fraud, according to Nacha’s website. This existing screening requirement will now be strengthened to make it clear that “account validation” is a solution designed to enhance fraud protection.

Specifically, originators of debits are responsible for validating accounts to ensure the account is legitimate and open prior to the first use of an account number or after changes to the account number by a customer. While the rule doesn’t require the account owner to match or be validated, Finicity Pay also enables companies to determine the account owner on file with the bank for heightened validation and further fraud prevention.

While there are many ways to validate accounts, Finicity’s open banking platform makes it easy to receive validation in real-time thanks to APIs and direct connections with financial institutions. Web debit originators don’t need to wait on manual verification, microdeposits, pre-notifications or any other service for dependable, accurate account verification.

How Finicity Pay Fits In

Finicity Pay will verify the essential account details, owners, and balances that are needed to charge, get paid, or set up an account with confidence.  As a complete suite, Finicity Pay enables payments and validates funding sources. It can also seamlessly verify loan account details, including student loans, to detect eligibility for refinancing, loan consolidation, or to support employer student loan repayment and other benefit programs. This means that Finicity Pay both satisfies Nacha’s web debit rule but also speeds up the payment validation process and enhances fraud protection. Finicity and SWBC are Nacha Preferred Partners, recognized for offering products and services that align with Nacha’s core strategies to advance the ACH Network.

SWBC provides financial institutions, businesses and individuals a wide range of services, including insurance, mortgages, wealth management, employee benefits, among others, and is a valued addition to our list of providers.To read more about this announcement, please read the press release here. And to learn more about Finicity Pay, check out our website.