What is a penny drop?
Penny Drop or Bank account verification as is commonly referred to is a way to verify the authenticity of a user's Bank Account. It's done by sending a penny or INR 1 (one rupee) in the Indian context - which returns the validated bank details along with the beneficiary's name.
Businesses that need to send funds and are wanting to verify the user's bank account. So, they can avoid sending funds to a third party.
Eezib who works to make your business easier can help to verify the bank account of the beneficiary with the "Penny Drop" service by just collecting their account and routing information.
How does the penny-drop feature work?
Essentially, the bank account will be verified by making a 'test transaction' of Repay 1 that's why it's called (a penny drop) in the subscriber's registered bank account.
Eezib will complete an instant authentication to check if the bank details provided by the User/Client are valid and if the account holder's name is similar to the one mentioned in the form. The 'success' or 'failure' of the penny transaction will be notified by us based on the validation of the savings account number according to the application records.
If the penny drop transaction fails for an account due to a different name or another mismatch, the customer will be failed notification. In case the bank account details are incorrect, it will also be notified.
Why do businesses need to verify Bank Accounts?
Penny Drop verification is done for numerous reasons but mostly to verify that the user's bank account is authentic and that it belongs to the user signing up for the service before transacting on it, and in India, for many financial services that involve bank account deposits (e.g., Mutual Funds, Insurance, Gaming etc) it is a regulatory requirement to verify users' bank accounts as part of KYC due diligence.
In simple terms: Here's how a penny drop works!
1. Your customer shares their Bank Account Number and IFSC with You (The Service Provider);
3. We will drop a penny (INR 1) into your customer's Bank Account;
Additionally, once the verification succeeds, you can complete the identity (KYC) details provided in the application form against the beneficiary's name.
How can you use the penny drop service?
To take the Eezib penny drop service you can E-Mail us at Support@eezib.com or call us at: + 91 - 9782009070
