Reverse Penny Drop API

The “Reverse Penny Drop API” is a verification method for validating bank account information. It allows users to deposit 1 rupee through a UPI-based transaction, which is then used to verify the accuracy of the bank account details provided. The API generates a unique reference ID and transaction note for each verification request. Upon successful verification, you’ll get the user name at the bank, bank account number, IFSC, UPI ID, etc, and the amount is auto-credited back to the user.

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Explanation of Reverse Penny Drop Process

The Reverse Penny Drop Verification redefines the process of bank account authentication by placing the onus of action on the account holder. Rather than depositing amounts into the user’s account, this method compels the account holder to send a nominal sum, precisely one rupee, to the entity performing the verification.

It pivots the traditional method on its head, providing a potent security enhancement. By making the account holder actively participate in the verification process, Reverse Penny Drop confirms not just the account’s existence, but its accessibility by the rightful owner. The outbound nature of the transaction significantly adds to the layers of security, curtailing the chances of falsified account validations and establishing a robust defense against fraud concerning account authentication procedures.

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Key Benefits of Using Reverse Penny Drop API

Enhanced Security

Reverse Penny Drop Verification adds an extra layer of security to the onboarding process, ensuring that the bank account belongs to the user and reducing the risk of fraudulent activities.

Reduced Chargebacks

By confirming the authenticity of the bank account, businesses can significantly reduce the likelihood of chargebacks due to unauthorized transactions or incorrect bank details.

Minimize Failed Transfers

With verified bank account details, businesses can minimize the number of failed transfers and payouts to incorrect beneficiaries, increasing overall transaction accuracy.

Unrivaled Coverage

The API covers all major banks, allowing users to verify their bank account details across a wide range of financial institutions.

Flexibility for Users

Users can verify their bank account details by launching any installed UPI app, providing them with a convenient and user-friendly verification process.

Accurate Reason for Verification Failure

The API provides accurate reasons for verification failures, helping businesses understand why a verification may have been unsuccessful.

Easy Integration

Businesses can easily integrate the Reverse Penny Drop API into their applications or websites, streamlining the bank account verification process for their users.

Real-Time Verification

The API allows for real-time verification of bank account details, ensuring that businesses have up-to-date and accurate information for their transactions.

Seamless User Experience

By allowing users to self-verify their bank account details, businesses can provide a seamless and efficient onboarding experience for their customers.

Cost-Effective Solution

The Reverse Penny Drop API offers a cost-effective solution for verifying bank account details, reducing the need for manual verification processes.

Compliance with Regulatory Requirements

Using the API helps businesses comply with regulatory requirements related to verifying user bank account details, ensuring adherence to industry standards.

Enhance Customer Trust

By implementing secure and accurate bank account verification processes, businesses can enhance customer trust and loyalty, leading to increased customer satisfaction and retention.

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Comparison to Traditional Penny Drop Method

The traditional Penny Drop Method has long been a go-to for its ability to enhance security by ensuring the rightful ownership of bank accounts. By depositing a minimal amount and verifying the transaction, businesses have been able to thwart fraudulent activity and prevent unauthorized transactions effectively. While effective, this method now shares the stage with the Reverse Penny Drop verification, which offers additional benefits.

A key difference lies in the direction of funds flow: while the traditional method involves an inbound transaction to the user’s account, the reverse method is predicated on an outbound one rupee payment from the user. Reverse Penny Drop holds the potential to reduce transaction fees, as well as minimize processing times, providing a real-time processing environment. This dynamism enriches the customer experience, forging stronger trust through heightened security and streamlined transactions.

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Features of Reverse Penny Drop API for Businesses

  1. Enhanced Security: The Reverse Penny Drop API adds an extra layer of security to the onboarding process for businesses. By verifying bank account details through a small transaction, businesses can ensure that the bank account belongs to the user, reducing the risk of fraudulent activities. This feature is especially valuable for industries such as fintech, e-commerce, and payment processing, where the authenticity of bank account details is crucial to prevent unauthorised transactions.
  1. Reduced Chargebacks: With the Reverse Penny Drop API, businesses can significantly reduce the likelihood of chargebacks due to incorrect bank details or unauthorised transactions. By confirming the validity of the bank account, businesses can minimise the risk of failed transfers and reversals, leading to a more seamless payment process. This feature is particularly beneficial for industries that deal with high volumes of transactions, such as online marketplaces and digital wallet platforms.

Overall, the Reverse Penny Drop API brings maximum value to businesses operating in industries that rely heavily on secure and accurate bank account verification processes. By enhancing security measures and reducing the risk of chargebacks, businesses can streamline their operations, build trust with customers, and maintain financial integrity in their transactions.

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Financial Services & Fintechs

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NBFCs & Lending Businesses

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Got questions?
Take a look at our FAQs below and get answers.

What is Reverse Penny Drop API?

Reverse Penny Drop API is a verification method for validating bank account information. It allows users to deposit 1 rupee through a UPI-based transaction to verify their bank account details.

Yes, after successful verification, the 1 rupee amount used in the reverse penny drop is automatically credited back to the beneficiary’s account.

Businesses can sign up with Deepvue and access the API documentation to learn how to integrate Reverse Penny Drop Verification into their applications or websites.

Yes, users need to refer to the Authorization page for authentication requirements before using the Reverse Penny Drop API.

Yes, We provides customer support to assist businesses throughout the integration and usage of the API. Our dedicated technical team is available to answer queries, provide guidance, and troubleshoot any issues that may arise.

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