Everything ACH

Do you know who I am?

I’m not talking about the D-List celebrity or self-important person who yells this at the bouncer who won’t let them into a club or at the person behind the counter who is trying to serve the customer who was in line first.  I’m talking about the person on the other end of the internet session or telephone line who wants to buy something from you.

Yup, I’m talking about WEB and TEL.  If you are processing WEB or TEL transactions, that question is one that needs to be addressed.  Now I know that you know that the ACH Operating rules require that you authenticate the identity of the Receiver for each transaction – before the authorization takes place.  But they don’t tell you how to authenticate that person.  Do you know how?  Are you doing it?  Please say ‘yes’.

From a practical standpoint or real-life perspective, I don’t.  I mean, I know the basics, but I don’t live this process – it’s a very back-end kind of thing to me.  So, I turned to our very own Leslie Hendrix, Vice President of Sales and Marketing and asked about it.

I didn’t really interview her, cause I’m not very good at that kinda stuff, but I asked her questions and she talked.  I even took notes.  OK, I interviewed her….

ACHGuy:  Ms. Hendrix, when you think of authentication for WEB and TEL transactions, what comes to mind?

Ms. Hendrix:  My, so formal.  I’m sure you know that the ACH Operating Rules require merchants that use ACH for WEB and TEL transactions to authenticate the identity of the Receiver using commercially reasonable measures. 

ACHGuy:  OK. Leslie.  Without sounding like you’re delivering a sales pitch for ACH Direct services, how is a merchant supposed to do that?

Note:  Merchant = Originator, but you already knew that. – ACHGuy

Leslie Hendrix:  There are many different services available in the marketplace to help merchants comply with the NACHA requirements. When I think authentication, I think Account Verification and Identity Authentication.

ACHGuy:  Can you give me an example or tell me a little about they work?

Leslie Hendrix:  Identity Verification services can be used to validate that someone is who they say they are.  Most identity verification services use a combination of publically available data in conjunction with private information.  Most services can optionally generate out-of-wallet questions for further identification, if necessary.

ACHGuy:  What about Account Verification?

Leslie Hendrix:  As far as Account Verification is concerned, there are many companies out there that offer a variety of services ranging from a simple Routing & Transit Number verification to Negative and Positive databases and even Funds Verification services. 

Note:  I included definitions of each of those below – ACHGuy

ACHGuy:  If a new Originator approached you, what would you recommend?

Leslie Hendrix:  I recommend that like most merchants, they should use a combination of identity and account verification services.  In the end, it’s all about protecting the merchant.  I also tell them that the most powerful verification services combine everything I’ve mentioned into one service to provide actionable, definitive responses on 100% of the checking accounts in the US. 

ACHGuy:  This is your ‘Buy my product’ moment.  Tell us what service, specifically, that you recommend and then sell it to me.  But keep it short, say 50 words or less?

Leslie Hendrix:  Thanks!  Specifically, I recommend a combination of IDVerify and ATMVerify.  This ensures that the merchant is in compliance with the NACHA rules and provides the merchant with reasonable assurance that the person is who they say they are and that the account information the consumer has provided to the merchant has a high probability of successful payment.  Interested merchants can find additional information about the services at www.atmverify.com and www.idverify.com.

Thank you to Leslie Hendrix, VP Sales and Marketing at ACH Direct for helping me out today.  And just for the record, if anyone is interested in ACH Direct’s verification services, they can contact our Payment Specialists at sales@achdirect.com or 866 378 0001.

I don’t generally care to ‘sell’ anything via my blog.  After all, it’s about education, not sales, but I needed some help and have zero budget.  With that in mind I hope you’ll forgive the shameless plug and more importantly, I hope you learned something today.  I know I did.

 ACHGuy

As mentioned above, here are the definitions promised.

Routing and transit verification – a service that will verify the validity of the routing and transit number

Negative database – a service that will determine whether there are any known unpaid items on an account

Account history database – also known as a positive database, these databases contain information about the history of items that have been presented on the account and whether or not the items paid successfully

Account current status verification – a service that will verify the current status of an account

Funds verification – a service that will verify that adequate funds are available in the account at the time of inquiry