Trends & Research

Trends & Research

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Published on Friday, April 15, 2022

Aliaswire Provides Solution to Support Compliance with WEB Debit Account Validation Rule

(And Offers NEACH Members a Discount)

“The dramatic growth in ACH payments is a result of the reliability of ACH and the transformation to digital payments,” explained Scott Goldthwaite, President of Aliaswire, a fintech focused on payments innovation, during a NEACH vendor showcase. "But as ACH continues to grow, so does fraud and attempted fraud. That’s why Nacha created the WEB Debit Account Validation Rule.


Specifically, the rule states: 


ACH Originators of WEB debit entries are required to use a "commercially reasonable fraudulent transaction detection system" to screen WEB debits for fraud. This existing screening requirement is being supplemented to make it explicit that "account validation" is part of a "commercially reasonable fraudulent transaction detection system." The supplemental requirement applies to the first use of an account number or changes to the account number.


While this rule went into effect on March 19, 2021, Nacha gave financial institutions a grace period to prepare, holding enforcement activity until March 19, 2022. With the enforcement date now in effect, financial institutions must ensure they are fully capable of complying.


But for many FIs, questions remain, including what constitutes a “commercially reasonable fraudulent transaction detection system,” and how can they be sure it’s fulfilling the new account validation requirement?


To help provide answers and tangible solutions, NEACH has partnered with Aliaswire, a Boston-based fintech, to help its members address the WEB Debit rule with its DirectBiller bill payment platform. DirectBiller's real-time bank account validation provides banks and their clients with a simple, low-cost solution for detecting fraudulent ACH payment transactions.


In real-time, DirectBiller first searches a proprietary database of known accounts. If the account has a prior successful payment history, DirectBiller considers it validated. If no account is found, DirectBiller then connects to Nacha's Phixius service for account validation.   


Nacha’s Phixius data platform provides a wide range of real-time APIs, including Bank Account Validation.


“By having real-time Bank Account Validation in place, all financial institutions using our services will meet the ‘commercially reasonable' requirement. Being a Nacha service provides a higher level of security and trust that our clients require," adds Goldthwaite.


Real-time Bank Account Validation is a standard feature within DirectBiller and a stand-alone service. “We’ve designed a solution specifically for NEACH members who don’t have billers on the DirectBiller platform,” said Goldthwaite. “You can just connect to the API to provide fast and accurate account validation.”


With that in mind, Aliaswire is pleased to offer NEACH members a discounted price for these services with no minimums. Although the company cannot discuss the specifics of the discount in a public forum, they are happy to answer any questions you have about their product or pricing by phone at 617-393-5326. Or, if you would like to discuss the WEB Debit Account Validation Rule in more detail, feel free to call our NEACH payments hotline at 781-321-1011.


We know that many FIs have been grappling with how to address this new compliance requirement, and by partnering with Aliaswire, we hope to provide a targeted, discounted offering that gives you one more tool to support your efforts.


Joe Casali, AAP, NCP


AUTHOR: Joe Casali, AAP, NCP
Executive Vice President

As the EVP of Payments Innovation for NEACH, Joe focuses on exploring innovative solutions and technologies that will help position members for success, both now and in the future. Connect with Joe to read more of his blogs, articles, and posts.


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