Why bank account verification is becoming essential for credit risk management

At a Glance

• Bank account verification confirms the identity of a bank account’s owner, rather than simply validating the bank account number and sort code.
• It helps businesses stay compliant with financial regulations like KYC (Know Your Customer) and AML (Anti-Money Laundering).
• Bank account verification helps in the fight against fraud, including evolving attacks like business impersonation, synthetic identity and application fraud.

Modern-day fraud tactics are outpacing the capabilities of traditional fraud checks, leaving businesses and customers demanding an extra layer of trust.

Bank account verification has emerged as the process of choice: offering speedy and secure customer onboarding for businesses, and error-free financial transactions for customers.

So, what is bank account verification, how does it work, and how should businesses go about adding it to their credit risk management processes? Let’s dive in.
 

Traditional fraud checks are vulnerable to modern threats

In an era of unpredictable AI-coordinated fraud schemes, legacy checks are starting to be seen as slow, inflexible and unreliable.

Without real-time verification tools, businesses risk falling victim to slow fraud detection and response times – with clunky manual reviews and processes unable to cope with increasingly unpredictable threats.

Traditional checks are also known to introduce errors. For example, it's been reported that an estimated 95% of alerts generated by traditional Anti-Money Laundering (AML) systems turn out to be false positives, where legitimate transactions are flagged as fraudulent.

What’s more, legacy checks are vulnerable to fraudsters’ ever-evolving tactics. They’re usually rule-based and rely on static data, which can be more easily manipulated nowadays with fraudsters using tools to create synthetic identities or impersonate legitimate businesses.

Bank account verification adds an extra layer of trust to credit checks

It’s one thing being able to prove a bank account’s details are correct. But that’s not as powerful as verifying the identity of the entity controlling it.

Confirming bank account ownership adds that key layer of trust to the credit risk process for businesses and organisations. And because it usually happens during customer onboarding – before credit is extended or payments are made – no money is put at risk.

Businesses will also stay compliant with regulation. Bank account verification supports the likes of KYC (Know Your Customer) and AML (Anti-Money Laundering), both legal obligations in industries like Financial Services.

Bank account verification is increasingly in use for online payment and direct debit set-up, business verification, and at the start of the customer onboarding process.

Verifying bank details early improves fraud detection later

From that point on, any changes, like requests for changes to payment information, can be flagged, referenced and quickly re-examined. It essentially gives you a baseline to ask: ‘This account’s different... why is that?’

Early verification also creates business benefits, helping you to:

• Build confidence in customer legitimacy, leading to safer onboarding decisions.
• Reduce DSO (Days Sales Outstanding), by preventing failed or delayed payments.
• Speed up payment cycles, improving cash flow and reliability.
• Create smoother internal processes with fewer payment disputes or credit repair.

Bank account verification could prevent high-profile payment fraud

Impersonation fraud is one of today’s most serious threats. In CEO fraud, for example, criminals pose as senior leaders to coerce staff into transferring funds.

From emails requesting urgent payment, to a growing spate of deepfake fraud attacks, financial institutions have seen a 2,137% rise in such threats since 2022.

In May 2025, Mark Read, former CEO of the world’s biggest advertising group WPP, was the target of a deepfake scam involving an AI voice clone. Fraudsters created a WhatsApp account with a publicly available image of Read and used it to set up a Microsoft Teams meeting, impersonating Read off camera using the chat window.

Early bank account verification has the potential to make incidents like this far less probable, introducing added security layers that the AI impersonation could not easily bypass.

5 steps to incorporate bank account verification into your business

1. Choose a trusted data provider: Whether you’re an enterprise, small business or public body, Dun & Bradstreet’s reputation for world leading business entity and account resolution is hard to beat.

2. Use APIs or decisioning platforms: Integrating third-party checks is a great way to create a streamlined and data-driven credit process.

3. Apply verification to high-risk accounts first: Where possible integrate during customer onboarding and remember that ongoing monitoring for change is crucial.

4. Track the outcomes: Keep an eye on metrics like DSO reduction, fraud detection rates and onboarding efficiency, to build and refine best practice.

5. Make verification part of your fraud prevention strategy: Think of it more as a cultural change in your fraud and credit risk strategy, rather than simply a compliance tick-box exercise.
 

Keen to find out more? Read up on Confirmation of Payee (CoP) and its EU equivalent, Verification of Payee (VOP) for more detail on bank account verification.