Check Verification Services

CHECK VERIFICATION SERVICES TECHNIQUE OVERVIEW


Check Verification is a process that screens checks and check writers to assess the risk associated with taking it. These services typically will check to make sure the account is open, determine if the account has had bounced checks before and it will check a "negative database" of "bad check writers".


Typical information Check Verification can provide:

  • Account Closed

  • Stop Payment

  • The account is currently in an NSF balance

  • Non DDA Account

  • Invalid Account Number

  • Invalid Routing Number

  • The account doesn’t exist

  • Stolen/Forged/Fraud

HOW DOES IT WORK?


This service is performed using a real-time internet process to access the account information and compare the new transaction against the list. If the customer has a history of bad checks, the transaction will be declined. If they are not in the database for bounced checks, they are approved


HOW DO YOU USE THE RESULTS?


Accounts that come back as invalid, fraudulent, closed, or are currently in a Non-Sufficient Funds balance will not be able to make payment for the transaction and the order should be stopped. Customers that show up on the negative database of bad check writers represent a much higher risk for bad deb

DID YOU KNOW?

Check Verification is a great tool for merchants accepting ACH and Direct Debit payments to help reduce bad debt risk.


Check Verification typically works by first making sure the account and routing numbers provided are valid, that it comes from a real account and that the account is an open Demand Deposit Account (DDA). The next step is to determine if the account is already overdrawn and to check the account number or account holder against a database of bad check writers.


Considerations When Implementing Check Verification:


When accepting checks and debit cards a verification service should be all that you need. Check guarantee services, in addition to using a verification service can actually cost you more money to process. Unless you yield a high sales volume each month to cover the extra cost for using a guarantee service, just stick with verification.


Check Verification with Conversion means that not only is the check Verified but it is also "converted" into electronic funds, this means that you do not have to deposit the check into your checking account; the funds will be deposited into your checking account for you automatically

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KEY NOTES


Alternative Solutions - Check Gaurantees


Building this In-House - N/A


Estimated Cost - Verification transactions usually cost around $0.15 - $0.35/per item. There may be a sign up/application fee. There IS often times a Monthly Minimum fee and always a Statement Fee, especially when dealing with retail check processing accounts.