Why verify a bank account before you pay
Once money leaves your account by EFT, getting it back from the wrong account is slow and often impossible. The most common way businesses lose money this way is simple: someone sends an invoice, or a "we have changed banks" email, with an account number that does not belong to the supplier.
The email may come from a hacked mailbox or an address one letter away from the real one, and the invoice may look exactly like the last ten you paid. Nothing on the document itself tells you the account is wrong. Asking the bank does.
What a bank account verification tells you
South African banks can answer a set of yes-or-no questions about an account, a service usually called an account verification service or AVS check. You give the bank, the account number and the holder's ID number (or passport number for a foreign holder) or company registration number, and the bank answers:
- Does the account exist at this bank?
- Is it open, or has it been closed?
- Does it belong to the ID, passport or company registration number you gave?
- Is it the type of account you expected, such as a cheque or savings account?
- Can it receive payments, and can it accept debit orders?
The bank does not show the balance, transactions, the holder's address or anything else about them. You learn only whether the details you already hold are right.
Ways to verify an account
- Call the payee on a number you already have. Use the number on file or from an earlier contract, never the one in the email that asked for the change. This is the cheapest check and the one every business should do for a change of banking details.
- Ask your own bank. Many banks offer account verification to business banking clients, often inside online banking or a bulk-payment service. Ask your bank what it offers and what it costs.
- Use a verification provider. Providers send the AVS request for you and return the bank's answer, without a business banking contract. CheckID's bank account verification costs R149 per check and emails a dated PDF with the bank's yes or no for each question, usually within minutes. You need the bank and account number, and the holder's name with their ID number (or passport number, if they are not South African), or the company name with its registration number. No branch code is needed.
- Ask for a bank confirmation letter. A stamped letter from the bank is common in supplier onboarding, but letters can be edited or forged. Treat a letter as a document to verify, not as proof on its own.
CheckID checks accounts at Absa, Access Bank, African Bank, Bank Zero, Bidvest Bank, Capitec, Discovery Bank, FNB, GoTyme Bank, Grindrod Bank, Investec, Nedbank, Sasfin Bank, Standard Bank. Capitec Business and Mercantile Bank business accounts use a different, slower check and are not supported yet.
When to verify
- A new supplier, before the first payment, and again whenever its banking details change.
- A new employee or contractor, before the first salary or invoice run, to confirm the account is in their own name.
- A debit order, before you load a mandate, to confirm the account is open and accepts debits.
- A refund, so the money goes back to the customer's own account and not one they were tricked into giving you.
- A deposit or a private sale, such as rent, a car or equipment, before a large transfer to someone you have not paid before.
How to read the result
Read every answer, not just the first one. An account that exists and is open but does not belong to the ID or registration number you gave is the classic sign of a fraudulent invoice. Do not pay it until you have spoken to the payee on a number you trust.
A "no" is not always fraud. The account may be in a trading name, held by a holding company, or the ID number you were given may have a typo. Ask the payee to explain, and check again with the corrected details. With CheckID a "no" answer is still a completed check and is not refunded; you are refunded in full only if the bank cannot be reached.
Build it into your payment process
- Never change a supplier's banking details on the strength of an email alone.
- Have a second person approve every new or changed beneficiary.
- Verify the account with the bank before the first payment, and keep the dated result with the supplier file.
- Be suspicious of urgency, of a new bank in a different province or country, and of an account in a personal name for a company invoice.
POPIA and bank details
Bank details and ID numbers are personal information under the Protection of Personal Information Act. You need a lawful reason to verify an account, such as paying a supplier or setting up a debit order, and you should use the result only for that. Many businesses mention the check in their supplier or customer onboarding form. Keep the result only as long as you need it.
A verified account confirms the payment details, not the business behind them. To confirm the company exists, read how to check a company registration, and to confirm the person asking for payment is a director, read how to check if someone is a director.
To confirm the supplier is a registered company first, use the CIPC Company Check (R299, once-off).
Ready to check one? Verify a bank account before the money leaves.