Late payments, fraud, and failed transfers cost UK businesses millions every year, but the scale of the problem is much bigger than most realise. According to the latest UK Finance Fraud Report, criminals stole £1.17 billion in 2023 through authorised and unauthorised fraud. One wrong digit in account details, or worse, a fraudster tricking you into sending money to the wrong account, can leave lasting damage to your bottom line. That’s why bank account verification has become a critical safeguard, ensuring every payment goes to the right place, protecting against fraud, and helping businesses move money faster without costly errors.
So let’s start with what bank account verification is, how it protects your business, and then delve into how it can actually speed up payments instead of slowing them down.
What is bank account verification?
Bank account verification is the process of confirming that a bank account actually belongs to the person or business claiming it. In practice, it checks that the account details (like sort code and account number in the UK) are valid and match the intended recipient before money moves.
There are different methods available:
- Micro-deposits: Sending a tiny amount (like 1p) and asking the recipient to confirm it.
- Bank statement checks: Reviewing uploaded statements (slow and vulnerable to spoofing).
- Open banking checks: Instant, secure verification via a direct bank connection.
- Confirmation of Payee (CoP): A UK-wide name-checking service now covering over 99% of Faster Payments and CHAPS transactions.
In short, bank account verification gives businesses peace of mind that they’re paying — and being paid by the right party.
How it protects your business
For UK businesses, the risks of not verifying accounts are high – misdirected funds, fraud losses, and strained customer relationships. By verifying bank accounts upfront, businesses can:
- Prevent fraud: Fraudsters often rely on businesses failing to double-check account details. With verification, suspicious mismatches are flagged instantly.
- Reduce failed payments: No more chasing bounced transfers or correcting typos in account numbers.
- Stay compliant: Verification aligns with KYC/AML regulations, helping you meet your obligations and pass audits more smoothly.
Since its launch, Confirmation of Payee alone has handled over 2 billion checks in the UK, showing how widely businesses are adopting verification to reduce fraud risks.
How it speeds up payments
Account verification reduces risk and also makes payments faster. Instead of waiting for failed transfers to return (which can take days), details are checked in real-time. With open banking technology and CoP, verification happens almost instantly, so money can move straight away through Faster Payments or CHAPS.
That means:
- Cash flow is smoother, with fewer delays.
- Customers get a better experience, as their payments go through on the first try.
- Less admin for finance teams, who spend less time correcting errors or chasing missing money.
Verification methods compared
| Method | Speed | Effort / Cost | Reliability |
|---|---|---|---|
Micro-deposits | 1–2 days | Low, but manual | Medium |
Bank statements | Days to weeks | Manual and slow | Low–medium |
Open banking checks | Instant | Moderate (integration needed) | High |
Confirmation of Payee | Real-time | Low | High |
How to implement bank account verification
The right method depends on your business model, but many UK firms are now choosing real-time verification through open banking or CoP. Implementation usually involves:
- Choosing a provider or payment partner that offers instant verification.
- Integrating verification into key points, like customer onboarding, supplier setup, or invoice payments.
- Training staff to use verification tools as part of normal payment workflows.
Some payment platforms, such as Atoa, already build in open banking verification, meaning every transaction is checked for accuracy and security before money moves.
Conclusion
Bank account verification isn’t just a nice-to-have; it’s a safeguard that protects against fraud, reduces failed payments, and speeds up cash flow. With fraud losses still in the hundreds of millions each year, UK businesses that don’t verify are exposing themselves to unnecessary risk. The good news is that modern tools make verification seamless and instant. By adopting these checks today, you can protect your business, improve your customer experience, and ensure every pound lands where it should, quickly and securely.
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