Orum unveils instant bank verification product built on FedNow

US-based Orum has launched the first product to be built on top of the Federal Reserve’s new instant payment rail, FedNow.

Called ‘Verify’, Orum’s patented technology enables businesses to establish the validity of US bank accounts within 15 seconds, before initiating payments.

Verify has 100% coverage of all US-based consumer and business bank accounts.

Failed payments cost the global economy in excess of $100 billion each year, according to Stephany Kirkpatrick, founder and chief executive officer of Orum.

“Lost time verifying accounts equals lost revenue and, ultimately, lost customers. This is especially true for business bank accounts, which are notoriously difficult to verify,” Kirkpatrick said.

The launch of FedNow meant that Orum was able to build technology that uses the new payment rail to provide real-time account information to businesses, with the “rich” data sent automatically back to the business via a webhook.

“Businesses need confidence they are debiting or crediting a real account to ensure the payment lands safely in the bank account, but most solutions today are slow or don’t include coverage for all B2B use cases.”

She added: “Verify – built on top of FedNow – has changed this equation, making it now possible to verify any type of bank account instantly.”

Orum’s API solution delivers access to major rails, including RTP, Same Day ACH, ACH, and Wires in addition to FedNow, and now instant bank account verification.

To date, Orum has raised more than $82 million from investors including Accel, Bain Capital Ventures and American Express Ventures.

FedNow went live in July this year, with 35 banks and credit unions signed up at the time.

“The Federal Reserve built the FedNow Service to help make everyday payments over the coming years faster and more convenient,” said Federal Reserve chair Jerome Powell.